July 20 (Reuters) – International Business Machines Corp posted quarterly revenue and earnings above analyst estimates on Monday, thanks to the strength of its high-margin cloud computing business.
IBM has scrapped part of its legacy business to focus on cloud computing, an area that has seen a lot of action in recent years as companies scale up their digital change to control costs and increase efficiency.
Revenue from the cloud business, previously led by new IBM chief Arvind Krishna, increased 30% to $ 6.3 billion in the second quarter.
Krishna took over as CEO of Ginni Rometty in April, while naming former Bank of America Corp technology executive Howard Boville as the new head of IBM’s cloud business.
IBM’s total revenue fell 5.4% to $ 18.12 billion in the quarter, but came in above analyst estimates of $ 17.72 billion, according to IBES data from Refinitiv. Excluding the impact of the sale of foreign exchange and businesses, revenues decreased 1.9%.
The company’s net income fell to $ 1.36 billion, or $ 1.52 per share, in the quarter ended June 30 from $ 2.5 billion, or $ 2.81 per share, a year earlier.
Excluding items, the company earned $ 2.18 per share, above estimates of $ 2.07 per share. (Report from Munsif Vengattil in Bangalore: Maju Samuel Edition)
