IBM shares rise despite posting 22nd straight quarter of top-line decline

Oliver Gill
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IBM shares rose over three per cent in after-hours trading (Source: Getty)

IBM shares rose in after-hours trading after the tech giant beat analyst expectations.

The figures

Third quarter total revenue was $19.2bn, down one per cent adjusting for currency movements.

Strategic imperatives revenue was up 10 per cent at $8.8bn and cloud revenue up 20 per cent at $4.1bn.

Earnings per share were $3.30 and IBM expects to finish the year with annual earnings of $13.80 per share.

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Why it's interesting

This evening's announcement delivered IBM's 22nd quarter of declining revenue.

But this was widely expected and shares rose by virtue of the fact analysts had pencilled in a bigger declined.

A Thomson Reuters consensus poll had expected third-quarter top line of $18.6bn and earnings per share of $3.28.

Shares jumped over three per cent in grey trading.

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What the company said

"In the third quarter we achieved double-digit growth in our strategic imperatives, extended our enterprise cloud leadership, and expanded our cognitive solutions business," said Ginni Rometty, IBM chairman, president and chief executive officer.

"There was enthusiastic adoption of IBM's new z Systems mainframe, which delivers breakthrough security capabilities to our clients."

"During the first three quarters of the year, our strong free cash flow has enabled us to maintain our R&D investments and to expand IBM's cloud and cognitive capabilities through capital investments," said Martin Schroeter, IBM senior vice president and chief financial officer.

"In addition, we have returned nearly $8bn to shareholders through dividends and share repurchases."

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