IBM reports nearly $15 billion in Q3 revenue, driven by strong demand for software.
IBM reported third-quarter earnings on Wednesday night (25) that surpassed Wall Street expectations, driven by strong demand for software products.
The company’s revenue rose about 5% during the period to $14.8 billion, compared to an estimate of $14.73 billion, according to data from LSEG.
Adjusted quarterly earnings per share came in at $2.20, also beating analyst projections.
Like the rest of the IT services sector, IBM is operating in a challenging macroeconomic environment that has led to tighter corporate client investment.
While some of its peers reported increasing weakness in consulting businesses, IBM's Chief Financial Officer James Kavanaugh told Reuters that the company gained market share in this segment.
Kavanaugh also revealed that IBM generated "hundreds of millions of dollars" in revenue from generative artificial intelligence projects in Q3, with clients including accounting firm Ernst & Young and Truist Bank.
"Big Blue" — which began offering AI applications to businesses years before the market boom triggered by OpenAI’s ChatGPT — said it is now seeing strong interest from "thousands of clients" in its software and consulting services.
“The company has done a fantastic job adapting to market needs, both in the AI and cloud computing segments,” said Thomas Monteiro, analyst at Investing.com.
Software revenue — now including Apptio, a recently acquired IT budgeting software developer — grew nearly 8%, excluding the impact of a strong dollar.
IBM, which generates more than half of its revenue outside the United States, said that a stronger U.S. dollar during the three months ending September 30 hurt its quarterly revenue by around $250 million, more than previously expected.
Source: CNN
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