Boston, MA 04/19/2013 (wallstreetpr) – IT giant International Business Machines Corp. (NYSE:IBM) (Current: $192.41, Down by: 7.09%) missed profit estimates predicted by analysts, as the company recorded declines in its services and hardware sales.
Analysts predicted earnings of $3.05 a share and revenue of $24.62 billion for IBM. However, the company recorded first-quarter net profit of $3.0 billion, down 1% from last year, while total revenues for the period was $23.4 billion, down by 5% from the first quarter of 2012.
IBM’s global technology services segment revenues declined 4% to reach $9.6 billion, whereas the global business services segment revenues fell 3% to $4.5 billion.
IBM reported $3.1 billion in revenues from its systems and technology division, down 17% from last year. In addition, revenues from IBM’s software segment remained flat at $5.6 billion.
In the first quarter, the Americas’ revenues decreased 4% to $10.0 billion; Europe/Middle East/Africa fell 4% at $7.3 billion; Asia-Pacific sales slid 7% to $5.7 billion. The company’s OEM revenues were $426 million, down16%.
The lower-than-expected earnings, however, didn’t allow IBM to change its full year forecast; and the company still remains positive for full-year 2013 expectation of GAAP diluted earnings per share of at least $15.53. Operating diluted earnings per share expectations remain $16.70.
As part of an effort to cut cost and restructure, IBM is reportedly in talks to sell its low-end server division to Lenovo Group. According to sources, the server business may fetch $2.5-$4.5 billion to IBM, depending on assets and liabilities.
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