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IBM Beats Earnings, Boosts Guidance

Stocks in this article: IBM

NEW YORK ( TheStreet) -- IBM (IBM) beat Wall Street's second-quarter estimate and raised its guidance after market close, despite missing analysts' topline forecast.

Excluding the impact of a $1 billion workforce rebalancing charge incurred in the quarter, the tech giant earned $3.91 a share, a year-over-year increase of 8%. IBM, however, brought in revenue of $24.9 billion, down 3% over the same period, or 1% adjusted for currency.

Analysts surveyed by Thomson Reuters were looking for earnings of $3.77 a share and sales of $25.37 billion.

The company's software revenue rose 4%, or 5% adjusted for currency. Within its software business, key branded middleware revenue grew 9%, or 10% adjusting for currency.

IBM's services revenue dipped 4%, or 1% adjusted for currency, but its services backlog was up 3% to $141 billion, or 7% adjusted for the effects of currency.

The Armonk, N.Y.-based firm saw revenue from its Systems and Technology business fall 12%, or 11% adjusted for currency, although sales of its System z mainframe climbed 10%, or 11% adjusting for the impact of currency.

"In the second quarter, we delivered strong performance in our higher-value software and mainframe businesses and again significantly increased our services backlog on growth in new business," said IBM CEO Ginni Rometty, in a statement released after market close.

Rometty added that IBM is confident of achieving its increased 2013 operating EPS expectation of at least $16.90, excluding the $1 billion workforce rebalancing charge. Previously, IBM had forecast operating EPS of at least $16.70.

IBM shares climbed 2.45% to $199.49 after market close.

--Written by James Rogers in New York.

>To submit a news tip, send an email to: tips@thestreet.com.

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