Venerable computing giant International Business Machines Corp. (NYSE:IBM) today posted better-than-expected third quarter earnings results, but its stock still sold off in after-hours trading.
The Armonk, NY-based company reported Q3 earnings per share (EPS) of $3.29, beating out analysts’ view of $3.23. Revenue fell 0.3% from last year to $19.23 billion. Wall Street expected smaller revenue of $19.01 billion.
IBM said its “strategic imperatives,” which are comprised of cloud, analytics, mobility, and security, jumped 16% from last year. Cloud segment revenues were a big growth story, with a massive 44% sales increase year-over-year.
Meanwhile, IBM’s Global Business Services unit was the standout on the negative side in Q3 with a 0.4% revenue decline from the same period in 2015.
From the press release:
“IBM’s third-quarter performance, led by continued double-digit growth in our strategic imperatives, is a testament to our leadership in cognitive solutions and cloud,” said Ginni Rometty, IBM chairman, president and chief executive officer. “Our ability to apply deep expertise and breakthrough technology, led by Watson and the IBM Cloud, to massive amounts of data is enabling us to build new markets and transform industries. Whether it is banks implementing IBM blockchain solutions, hospitals leveraging Watson to fight cancer, or retailers using cognitive apps built on the IBM Cloud to transform the customer experience, clients across all industries are tapping into a new kind of innovation value from IBM.”
Investors were none too pleased with the company’s results, with IBM shares falling $4.03 (-2.60%) to $150.74 in after-hours trading on Monday. Prior to today’s earnings report, IBM had gained 12.46% year-to-date.