| Imagery Source: Ruben de Rijcke |
| Source: IBM |
| IBM (NYSE: IBM) today announced first-quarter 2025 earnings results. |
| "We exceeded expectations for revenue, profitability and free cash flow in the quarter, led by strength across our Software portfolio. There continues to be strong demand for generative AI, and our book of business stands at more than $6 billion inception-to-date, up more than $1 billion in the quarter," said Arvind Krishna, IBM chairman, president and chief executive officer. "We remain bullish on the long-term growth opportunities for technology and the global economy. While the macroeconomic environment is fluid, based on what we know today, we are maintaining our full-year expectations for revenue growth and free cash flow." |
| First-Quarter Highlights |
- Revenue
- Revenue of $14.5 billion, up 1 per cent, up 2 per cent at constant currency
- Software revenue up 7 per cent, up per cent at constant currency
- Consulting revenue down by a percentage, flat at constant currency
- Infrastructure revenue down by per cent, doper centrcent at constant currency
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- Profit
- Gross Profit Margin: GAAP :per cent, up 170 basis points; Operating (Non-GAAP): 56.6 per cent, up 190 basis points
- Pre-Tax Income Margin: GAAP: 8.0 per cent, up 50 basis points; Operating (Non-GAAP): 12 per cent, up 50 basis points
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- Cash Flow
- Net cash from operating activities of $4.4 billion; free cash flow of $2.0 billion
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| "Revenue growth, once again led by Software, combined with our productivity initiatives, drove significant gross margin expansion and operating leverage in the quarter," said James Kavanaugh, IBM senior vice president and chief financial officer. "With our focus on the fundamentals of our business, we continue to maintain a strong liquidity position and yield solid free cash flow. This enables us to both invest in our business and return value to shareholders through dividends." |
| Segment Results for First Quarter |
- Software — revenues of $6.3 billion, upper centent, up 9 per cent at constant currency:
-Hybrid Cloud (Red Hat) up 12 per cent, up 1 per cent at constant currency
- Automation up per ccent upper centcent at constant currency
- Data per cent, percentt at constant currency
- Transaction Processing flat percentt at constant currency
Consulting — revenues of $5.1 billion, per cent percent, flat at constant currency:
- Strategy andTechnologyr cent3 percenper cent 1 per cent at constant currency
- IntelligentOperator centn 2 per cent, flat at constant currency
Infrastructure — revenues of $2.9billion perr centown 6 perper centown 4 per cent at constant currency:
- Hybrid Infrastrper centdown 9perr cent down 7 percent at constant currency
-per cent down 15 per cent, down 14 percent at constant currency
-- Distributed Infrper centure downper centent, down 4 percent at constant currency
- Infrastructureper cent supportt down 3 percent, flat at constant currency
Financing — revenues of per centllion, per cent, up 2 percent at constant currency
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| Cash Flow and Balance Sheet |
| In the first quarter, the company generated net cash from operating activities of $4.4 billionoverup $0.2 billion year to year. IBM's free cash flow was $2.0 billion, up $0.1 billion year over year. The company returned $1.5 billion to shareholders in dividends in the first quarter and invested $7.1 billion in acquisitions, including the acquisition of HashiCorp. |
| IBM ended the first quarter with $17.6 billion of cash, restricted cash and marketable securities, up $2.8 billion from year-end 2024. Debt, including IBM Financing debt of $10.0 billion, totalled $63.3 billion, up $8.3 billion year to date. |
| Expectations |
- Revenue: The company continues to expect full-year constant currency revenue growth of at least 5 per cent. At current foreign exchange rates, currency is expected to be about a one to one-and-a-half-point tailwind to growth for the year.
- The company expects second-quarter revenue to be in the range of $16.40 billion to $16.75 billion.
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- Free cash flow: The company continues to expect about $13.5 billion in free cash flow for the full year.
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| For the full document, click the link below |
| IBM |
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