NEW YORK (TheStreet) - Just 6 weeks after clinching a $2.3 billion deal to sell IBM's (IBM - Get Report) low-end server business to Lenovo, CEO Ginni Rometty vowed to maintain the company's significant hardware presence in her annual letter to shareholders.
The Lenovo deal, which was announced in late January, prompted a flurry of media reports that IBM was looking to sell off other chunks of its hardware, such as its chip making operation.
"Let me be clear-we are not exiting hardware," wrote Rometty, in the letter, which will be released to shareholders tomorrow. "IBM will remain a leader in high-performance and high-end systems, storage and cognitive computing, and we will continue to invest in R&D for advanced semiconductor technology."
(HPQ), Microsoft (MSFT) and EMC (EMC), has been tightening its focus on high-margin areas such as software and services for a number of years. IBM's 2013 software revenue was $25.93 billion, a year-over-year increase of 1.9%, or 2.9% adjusted for currency, while Global Business Services revenue was $18.4 billion, a return to revenue growth at constant currency. Big Blue's total 2013 revenue was $99.75 billion, down 4.6% from the prior year, or 2.5% adjusted for the effects of currency. In her letter, Rometty described 2013 as a successful year for IBM, but acknowledged that "our performance did not meet our expectations." The CEO pointed, in particular, to the company's operating pre-tax income, which declined 8% year-over-year, and its overall revenue dip.