IBM Grows Profit, Boosts Guidance

Updated with pre-market share price and CFO comments.

ARMONK, N.Y. (TheStreet) -- IBM's(IBM) profit grew during its fourth-quarter, the company announced today after market close. The tech bellwether also gave a bullish earnings projection for 2010.

During the fourth quarter, IBM earned $3.59 a share on net income of $4.8 billion, up from $3.27 a share and $4.4 billion in the prior year's quarter. Analysts surveyed by Thomson Reuters had predicted earnings of $3.47 a share.

The hardware and software maker also posted revenue of $27.2 billion, a 1% increase on the same period last year and a number that came in just above analysts' estimates of $26.96 billion.

For fiscal 2010, IBM expects earnings of more than $11 a share, north of the company's previous range between $10 and $11.

"We are confident about 2010 and our ability to achieve the high-end of our long-term roadmap," said IBM CEO Sam Palmisano, in a statement.

Despite IBM's fourth-quarter performance, though, the company's shares dipped $2.14, or 1.60%, to $132 in pre-market trading on Tuesday.

During fiscal 2009, IBM posted sales of $95.8 billion, down from $103.6 billion during 2008. Earnings, however, grew from $8.89 a share in 2008 to $10.01 a share in 2009. Analysts had predicted sales of $95.57 billion.

"We concluded a strong year with a solid performance in the fourth quarter in which we again delivered growth in margins, profit and earnings," said Palmisano. "IBM continued to benefit from our strategic transformation, offerings that our clients value in this economy, and our commitment to developing countries around the world."

IBM, which competes with Hewlett-Packard(HPQ) and Microsoft(MSFT), was one of tech's best performers during the recession thanks to its focus on high-margin areas such as software and services.