On Thursday, International Business Machines (IBM) came out with its results for the third-quarter in which it posted a 14% increase in net income over last year, with the figure this year rising to $3.2 billion.
The results, which were in compliance to what the analysts had predicted, also showed that its per-share earnings stood at $2.40, just tipping the $2.38 per share figure estimated by analysts. But it failed to impress the investors and IBM shares were reported to drop 5% in after- hours trading.
Also, IBM’s sales fell by 5% in the North American region and by 6% in emerging markets. But a 12% drop was observed in the Middle East, Europe and Africa.
The shining light for this quarter was software. Sales in software fell 3%, which is the smallest decline for any business unit in the company. But there was a 2% rise in the sale of middleware products, the exact figure being $2.9 billion. Middleware from IBM like WebSphere and Tivoli amongst others were responsible for more than half of the revenue generated by software during this quarter.
Even as revenues dipped in comparison to last year, the company has a positive outlook for the rest of the year with full-year 2009 earnings expected to be a minimum of $9.85 per share, whereas the previous prediction stood at $9.70 per share. The positive outlook is due to the improvement seen in sales trends in this quarter.
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