International Business Machines Corp. (IBM) shares were rising sharply in post-market trading on Tuesday after the company posted a fourth-quarter earnings print that beat expectations and increased guidance for 2019.
The stock was rising 7.5% to $131.70 a share, after having fallen 1.09% in regular hours.
Adjusted earnings per share were $4.87, beating Wall Street's expectations of $4.82. Revenue came in at $21.8 billion, beating expectations of $21.73 billion. Net income was $1.95 billion.
Management also guided for adjusted diluted earnings-per-share of "at least" $13.90 for the full year of 2019, beating expectations of $13.80.
"In 2018 we returned to full-year revenue growth, reflecting growing demand for our services and leadership solutions in hybrid cloud, AI, analytics and security," said Ginni Rometty, IBM chairman, president and chief executive officer, in a press release. "Major clients worldwide, such as BNP Paribas, are turning to the IBM Cloud and our unmatched industry expertise to transform their businesses and drive innovation," she added. IBM also now counts Vodafone as a partner in creating optimized cloud solutions.
Revenues for Technology Services and Cloud Platforms came in at $8.9 billion, missing analyst expectations of $9.04 billion, but the company reported growth in hybrid cloud revenue. And revenues for IBM's Cognitive Solutions group beat expectations, as did those for Global Business Services.
This marks the second quarter in a row of declining revenues on a year-over-year basis, with the top line falling 1% this quarter and 2% in the third quarter. This follows several quarters of top line growth. Still, revenue for the full year of 2018 was just barely positive, up 0.06% from $79.13 billion in 2017 to $79.59 billion in 2018.
For the full year, IBM said that revenue from its "strategic imperatives," which includes high-growth areas such as the cloud, analytics, mobile and security, rose 9% to $39.8 billion. And its cloud revenue for the year rose 12% to $19.2 billion, with $11.3 billion of that delivered as a service and $7.8 billion for cloud-related hardware, software and services.
IBM shares are down 26% in the past year.
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