IBM’s well-documented shedding of dead business wood has continued into 2015, with the tech giant reporting its 12th consecutive quarter of revenue decline.
In announcing first-quarter 2015 earnings, IBM reported consolidated net income of US$2.3 billion or $2.35 of diluted earnings per share, including operating net losses in discontinued operations related to the Microelectronics business.
As the company turns its focus to cloud-computing offerings, total revenues from continuing operations for the first quarter of 2015 of $19.6 billion were down 12 percent, flat year-to-year adjusting for currency and divested businesses, from the first quarter of 2014.
"In the first quarter we had a strong start to the year,” says Ginni Rometty, chairman, president and CEO, IBM.
“Our strategic imperatives growth rate accelerated, demonstrating the power of our offerings in these new opportunities and contributing to improved revenue performance.
“Our focus on higher value through portfolio transformation and investment in key areas of the business drove continued margin expansion.”
Revenues from IBM’s growth markets decreased 16 percent while the company’s major markets were down 11 percent.
Furthermore, Global Services revenues decreased 12 percent to $12.2 billion, Global Technology Services segment revenues were down 11 percent to $7.9 billion and Global Business Services segment revenues were down 13 percent to $4.3 billion.
Revenues from the Software segment were down 8 percent to $5.2 billion compared with the first quarter of 2014 while revenues from IBM’s key middleware products, which include WebSphere, Information Management, Tivoli, Workforce Solutions and Rational products, were $3.5 billion, down 5 percent versus the first quarter of 2014.
In addition, operating systems revenues of $0.4 billion were down 15 percent compared with the prior-year quarter.
From a hardware perspective, revenues for the Systems Hardware segment totalled $1.7 billion for the quarter, down 23 percent from the first quarter of 2014.