IBM reports 12pc profit increase

19 Jan 2005

In what IBM chairman and CEO Samuel Palmisano described as “IBM’s strongest fourth quarter ever” the computer giant reported that earnings exceeded US$3bn for the first time. Profits increased 12pc to US$3.1bn from US$2.8bn a year ago.

During the fourth quarter IBM reported revenues of US$27.7bn, up 7pc on the same quarter a year ago.

Revenues grew in all of IBM’s five industry sectors in the fourth quarter led by the communications sector, as well as growth in sales to SMEs.

Fourth-quarter revenue growth of 7pc was driven by growth across all geographies. In the Americas, fourth-quarter revenues from continuing operations were US$11.1bn, up 5pc from the 2003 period. Revenues from EMEA were US$10.0bn, an increase of 9pc. Asia-Pacific revenues grew 6pc to US$5.8bn. OEM revenues increased 10pc to US$787m compared with the fourth quarter of 2003.

Palmisano commented: “IBM delivered a powerful fourth quarter, reflecting the strength of our integrated business model. It was IBM’s strongest fourth quarter ever, with earnings exceeding US$3bn for the first time. Our balance sheet remains strong with superior cash flow and we took share in key markets.

“We also returned US$8.3bn to our shareholders through dividends and stock buyback during 2004, the most we have done in our history. The strategic actions that IBM took last year have increased our focus on delivering high value to enterprises. IBM is well positioned to continue our mission of bringing together the best insight, expertise and technologies to help our clients transform their businesses,” Palmisano said.

By John Kennedy