Known in the tech industry as the Big Blue, IBM reported a 13pc drop in quarterly earnings and narrower income across business sectors including: Cloud and Watson, its AI business unit. However, things have been a little bit rough for IBM, as their total revenue dropped down for 20th consecutive quarter.
The company’s Q1 revenues for 2017 fell short of expectations, reporting a bigger that expected decline for the first time in five quarters.
IBM claimed revenues of $18.2 billion for the first quarter of 2017. The company said that their first quarter earnings dipped because some large service contracts fell through. The company’s 20th quarterly decline is a reminder to investors that they will need to be patient while the company positions itself to capitalize on the big bets it is making on the future.
IBM is in the middle of an uneasy reform, having an overhaul transition from its traditional business model to newer bets. However, even though the return to growth that Chief Executive Officer: Ginni Rometty has promised investors are taking longer to occur, ther strategy appears to be effectively on point.
The revenue from the company’s strategic imperatives during the quarter was $7.8 billion, ip 12pc on the previous year. On the other hand, revenues from Cloud were $3.5 billion, which is up 33pc year on year. With these statistics, IBM said that mobile earnings have increased 20pc and security earnings increased 9pc.
With the fact that IBM is moving swiftly into areas such as AI and block chain is suggestive of the overall transition of the company in the last decade. With these events, it is clear that Rometty has achieved a feat by turning what was the world’s biggest PC manufacturer into a pure-play software enterprise. Making every transformation slow, yet steady and effective.