- IBM reported Q3 revenue of $17.10 billion, up 4.7%, and adjusted EPS of $2.95, both above analyst estimates.
- Software revenue rose 8.3% to $7.80 billion, led by an 11% rise in hybrid cloud and a 9% increase in transaction processing software.
- About 25% of transaction processing revenue came from deals deferred from Q2, and the remaining 75% is net new business.
- IBM raised its annual software revenue growth forecast to about 7% to 8%, up from 6% to 8%.
- IBM reaffirmed its full-year revenue growth guidance of 4% to 5%.
- Around two-thirds of the Q2 deals that slipped have closed in Q3, and IBM is optimistic about most of the rest, per CFO Jim Kavanaugh.
- Shares rose about 4% in extended trading after the report.
Quotes
“about 25% of the transaction processing revenue came from deals deferred from the second quarter and the remaining 75% is net new business.”