IBM New Zealand takes a tumble in 2020

IBM New Zealand takes a tumble in 2020

IBM-owned Red Hat is growing in New Zealand, but its parent is not.

Credit: IBM

IBM's New Zealand revenues were down year-on-year, including revenues from supposed growth segments such as cloud and cognitive services.

IBM NZ reported sales of $210.6 million for the year to 31 December, down from $257.9 million.

Profit before income tax nearly halved, from $27.5 million to $14.1 million.

Wages and salaries paid fell from $52.7 million to $45.2 million while termination payments increased from $1.2 million in 2019 to $3.8 million in 2020.

Revenue from the strategic cloud and cognitive services space fell from $83.5 million to $59.6 million.

IBM acquired Red Hat at the end of 2020 and the two companies still report their New Zealand results separately.

Red Hat's latest local report, to the end of February 2020, showed revenue lifting from $13.4 million to $16.2 million. Profit before tax grew from $1.1 million to $1.6 million.

"We are partnering closely with organisations that have launched transformations following the challenging events of 2020," an IBM spokesperson said in response to a request for comment. 

"Our investments in hybrid cloud, artificial intelligence and security are helping New Zealand businesses unlock insights and scale at speed, so that they can respond more quickly to change and advance their digital strategies."

David Hook, who was appointed country leader towards the end of the 2020 reporting period, told Reseller News last month IBM was aiming to win in the hybrid cloud market through a channel strategy.

Embracing and supporting partners was a key part of the company's new global strategy focusing on the opportunities presented by its US$34 billion acquisition of Red Hat to become a hybrid cloud provider, as well as other core strengths in data and artificial intelligence.

IBM NZ said it had also expanded its investment in skills with the launch of two free skills platforms, and was recognised at the 2020 NZ Hi Tech Awards.

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