Technology and consulting corporation
IBM has seen a 21% reduction in its first quarter earnings based on the same period in 2013. The corporation also experienced a reduction in sales, dropping 4% on the first quarter 2013.
The reason behind the reduction was weak hardware sales and the corporation’s restructuring costs caused by a shift to cloud-based services. Although IBM hardware sales dipped by 23% during the period, it still posted a profit of $2.38 billion on revenue of $22.48 billion. Although the results were expected, the corporation’s shares went down to $188 in after-hours trading – a slide of 4.3%.
News of the revenue reduction hid the fact that company’s software and services division – which includes "Big Blue" and big data analytics – performed well, generating $5.7 billion.
"In the first quarter, we continued to take actions to transform parts of the business and to shift aggressively to our strategic growth areas including cloud, big data analytics, social, mobile and security," explained the Chairman, President and Chief Executive of IBM, Ginni Rometty. "As we move through 2014, we will begin to see the benefits from these actions. Over the long term, they will position us to drive growth and higher value for our clients."
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