IBM Reports 2018 Third-Quarter Results

October 17, 2018

ARMONK, N.Y., October 17, 2018 — IBM has announced third-quarter results.

“IBM’s progress and momentum this year in the emerging, high-value segments of the IT industry are driven by our innovative technology, deep industry expertise and commitment to trust and security,” said Ginni Rometty, IBM chairman, president and chief executive officer.  “Our leadership in the technology and services that deliver hybrid cloud, AI, blockchain, analytics and security has helped drive our overall performance, and is helping our clients unleash the full business value of these innovations.”

 

THIRD QUARTER 2018

 

Diluted
EPS

Net
Income

Pre-tax
Income

Pre-tax
Income
Margin

Gross
Profit
Margin

GAAP from Continuing Operations

$2.94

 

$2.7B

$3.0B

  16.0%

46.9%

  Year/Year

1%

-1%

-2%

0.0Pts

0.0Pts

Operating (Non-GAAP)

$3.42

 

$3.1B

$3.6B

  19.2%

47.4%

  Year/Year

5%

3%

1%

0.5Pts

0.0Pts

“In the quarter, we again expanded our overall operating pre-tax income margin year to year, and produced our strongest year-to-year  gross margin performance in three years,” said James Kavanaugh, IBM senior vice president and chief financial officer.  “At the same time, with our strong cash generation, we increased our capital investment in the business through the first three quarters and continued to return capital to shareholders.”

Strategic Imperatives Revenue

Strategic imperatives revenue over the last 12 months was $39.5 billion, up 13 percent (up 11 percent adjusting for currency).  Total cloud revenue over the last 12 months was $19.0 billion, up 20 percent (up 18 percent adjusting for currency), with $8.1 billion from hardware, software and services to enable IBM clients to implement hybrid cloud solutions across public, private and multi-cloud environments, and $10.9 billion delivered as a service.  The annual exit run rate for as-a-service revenue increased in the quarter to $11.4 billion, up 21 percent (up 24 percent adjusting for currency).

Cash Flow and Balance Sheet

In the third quarter, the company generated net cash from operating activities of $4.2 billion, or $3.1 billion, excluding Global Financing receivables.  IBM’s free cash flow was $2.2 billion.  IBM returned $2.1 billion to shareholders through $1.4 billion in dividends and $0.6 billion in gross share repurchases.  At the end of September 2018, IBM had $1.4 billion remaining in the current share repurchase authorization.

IBM ended the third quarter with $14.7 billion of cash on hand.  Debt totaled $46.9 billion, including Global Financing debt of $30.4 billion.  The balance sheet remains strong and is well positioned for the long term.

Segment Results for Third Quarter

  • Cognitive Solutions (includes solutions software and transaction processing software) — revenues of $4.1 billion, down 6 percent (down 5 percent adjusting for currency), with growth in Watson health, security solutions, and key strategic areas in analytics.
  • Global Business Services (includes consulting, application management and global process services) — revenues of $4.1 billion, up 1 percent (up 3 percent adjusting for currency), led by consulting.  Gross profit margin increased 270 basis points.
  • Technology Services & Cloud Platforms (includes infrastructure services, technical support services and integration software) —revenues of $8.3 billion, down 2 percent (flat year to year adjusting for currency), with growth in cloud revenue.  Gross profit margin increased 120 basis points.
  • Systems (includes systems hardware and operating systems software) — revenues of $1.7 billion, up 1 percent (up 2 percent adjusting for currency), driven by growth in Power and IBM Z.
  • Global Financing (includes financing and used equipment sales) — revenues of $388 million, down 9 percent (down 7 percent adjusting for currency).

Full-Year 2018 Expectations

The company expects operating (non-GAAP) diluted earnings per share of at least $13.80, and GAAP diluted earnings per share of at least $11.60. Operating (non-GAAP) diluted earnings per share exclude $2.20 per share of charges for amortization of purchased intangible assets, other acquisition-related charges, retirement-related charges and any one-time impacts from the enactment of U.S. Tax Reform.  GAAP expectations exclude any fourth-quarter one-time impacts from the enactment of U.S. Tax Reform.

IBM expects free cash flow of approximately $12 billion, with a realization rate greater than 100 percent.

Year-To-Date 2018 Results

Consolidated diluted earnings per share from continuing operations was $7.36 compared to $7.24, up 2 percent year to year.  Consolidated net income was $6.8 billion, flat year to year.  Revenues for the nine-month period totaled $57.8 billion, an increase of 2 percent year to year (flat year to year adjusting for currency), compared with $56.6 billion for the first nine months of 2017.

Operating (non-GAAP) diluted earnings per share from continuing operations was $8.96 compared with $8.54 per diluted share for the 2017 period, an increase of 5 percent.  Operating (non-GAAP) net income for the nine months ended September 30, 2018 was $8.2 billion compared with $8.0 billion in the year-ago period, an increase of 3 percent.


Source: IBM

Subscribe to HPCwire's Weekly Update!

Be the most informed person in the room! Stay ahead of the tech trends with industy updates delivered to you every week!

Pfizer HPC Engineer Aims to Automate Software Stack Testing

January 17, 2019

Seeking to reign in the tediousness of manual software testing, Pfizer HPC Engineer Shahzeb Siddiqui is developing an open source software tool called buildtest, aimed at automating software stack testing by providing the community with a central repository of tests for common HPC apps and the ability to automate execution of testing. Read more…

By Tiffany Trader

Senegal Prepares to Take Delivery of Atos Supercomputer

January 16, 2019

In just a few months time, Senegal will be operating the second largest HPC system in sub-Saharan Africa. The Minister of Higher Education, Research and Innovation Mary Teuw Niane made the announcement on Monday (Jan. 14 Read more…

By Tiffany Trader

Google Cloud Platform Extends GPU Instance Options

January 16, 2019

If it's Nvidia GPUs you're after to power your AI/HPC/visualization workload, Google Cloud has them, now claiming "broadest GPU availability." Each of the three big public cloud vendors has by turn touted the latest and Read more…

By Tiffany Trader

HPE Extreme Performance Solutions

HPE Systems With Intel Omni-Path: Architected for Value and Accessible High-Performance Computing

Today’s high-performance computing (HPC) and artificial intelligence (AI) users value high performing clusters. And the higher the performance that their system can deliver, the better. Read more…

IBM Accelerated Insights

Resource Management in the Age of Artificial Intelligence

New challenges demand fresh approaches

Fueled by GPUs, big data, and rapid advances in software, the AI revolution is upon us. Read more…

STAC Floats ML Benchmark for Financial Services Workloads

January 16, 2019

STAC (Securities Technology Analysis Center) recently released an ‘exploratory’ benchmark for machine learning which it hopes will evolve into a firm benchmark or suite of benchmarking tools to compare the performanc Read more…

By John Russell

Google Cloud Platform Extends GPU Instance Options

January 16, 2019

If it's Nvidia GPUs you're after to power your AI/HPC/visualization workload, Google Cloud has them, now claiming "broadest GPU availability." Each of the three Read more…

By Tiffany Trader

STAC Floats ML Benchmark for Financial Services Workloads

January 16, 2019

STAC (Securities Technology Analysis Center) recently released an ‘exploratory’ benchmark for machine learning which it hopes will evolve into a firm benchm Read more…

By John Russell

A Big Data Journey While Seeking to Catalog our Universe

January 16, 2019

It turns out, astronomers have lots of photos of the sky but seek knowledge about what the photos mean. Sound familiar? Big data problems are often characterize Read more…

By James Reinders

Intel Bets Big on 2-Track Quantum Strategy

January 15, 2019

Quantum computing has lived so long in the future it’s taken on a futuristic life of its own, with a Gartner-style hype cycle that includes triggers of innovation, inflated expectations and – though a useful quantum system is still years away – anticipatory troughs of disillusionment. Read more…

By Doug Black

IBM Quantum Update: Q System One Launch, New Collaborators, and QC Center Plans

January 10, 2019

IBM made three significant quantum computing announcements at CES this week. One was introduction of IBM Q System One; it’s really the integration of IBM’s Read more…

By John Russell

IBM’s New Global Weather Forecasting System Runs on GPUs

January 9, 2019

Anyone who has checked a forecast to decide whether or not to pack an umbrella knows that weather prediction can be a mercurial endeavor. It is a Herculean task: the constant modeling of incredibly complex systems to a high degree of accuracy at a local level within very short spans of time. Read more…

By Oliver Peckham

The Case Against ‘The Case Against Quantum Computing’

January 9, 2019

It’s not easy to be a physicist. Richard Feynman (basically the Jimi Hendrix of physicists) once said: “The first principle is that you must not fool yourse Read more…

By Ben Criger

The Deep500 – Researchers Tackle an HPC Benchmark for Deep Learning

January 7, 2019

How do you know if an HPC system, particularly a larger-scale system, is well-suited for deep learning workloads? Today, that’s not an easy question to answer Read more…

By John Russell

Quantum Computing Will Never Work

November 27, 2018

Amid the gush of money and enthusiastic predictions being thrown at quantum computing comes a proposed cold shower in the form of an essay by physicist Mikhail Read more…

By John Russell

Cray Unveils Shasta, Lands NERSC-9 Contract

October 30, 2018

Cray revealed today the details of its next-gen supercomputing architecture, Shasta, selected to be the next flagship system at NERSC. We've known of the code-name "Shasta" since the Argonne slice of the CORAL project was announced in 2015 and although the details of that plan have changed considerably, Cray didn't slow down its timeline for Shasta. Read more…

By Tiffany Trader

Summit Supercomputer is Already Making its Mark on Science

September 20, 2018

Summit, now the fastest supercomputer in the world, is quickly making its mark in science – five of the six finalists just announced for the prestigious 2018 Read more…

By John Russell

AMD Sets Up for Epyc Epoch

November 16, 2018

It’s been a good two weeks, AMD’s Gary Silcott and Andy Parma told me on the last day of SC18 in Dallas at the restaurant where we met to discuss their show news and recent successes. Heck, it’s been a good year. Read more…

By Tiffany Trader

The Case Against ‘The Case Against Quantum Computing’

January 9, 2019

It’s not easy to be a physicist. Richard Feynman (basically the Jimi Hendrix of physicists) once said: “The first principle is that you must not fool yourse Read more…

By Ben Criger

US Leads Supercomputing with #1, #2 Systems & Petascale Arm

November 12, 2018

The 31st Supercomputing Conference (SC) - commemorating 30 years since the first Supercomputing in 1988 - kicked off in Dallas yesterday, taking over the Kay Ba Read more…

By Tiffany Trader

Contract Signed for New Finnish Supercomputer

December 13, 2018

After the official contract signing yesterday, configuration details were made public for the new BullSequana system that the Finnish IT Center for Science (CSC Read more…

By Tiffany Trader

Nvidia’s Jensen Huang Delivers Vision for the New HPC

November 14, 2018

For nearly two hours on Monday at SC18, Jensen Huang, CEO of Nvidia, presented his expansive view of the future of HPC (and computing in general) as only he can do. Animated. Backstopped by a stream of data charts, product photos, and even a beautiful image of supernovae... Read more…

By John Russell

Leading Solution Providers

SC 18 Virtual Booth Video Tour

Advania @ SC18 AMD @ SC18
ASRock Rack @ SC18
DDN Storage @ SC18
HPE @ SC18
IBM @ SC18
Lenovo @ SC18 Mellanox Technologies @ SC18
NVIDIA @ SC18
One Stop Systems @ SC18
Oracle @ SC18 Panasas @ SC18
Supermicro @ SC18 SUSE @ SC18 TYAN @ SC18
Verne Global @ SC18

HPE No. 1, IBM Surges, in ‘Bucking Bronco’ High Performance Server Market

September 27, 2018

Riding healthy U.S. and global economies, strong demand for AI-capable hardware and other tailwind trends, the high performance computing server market jumped 28 percent in the second quarter 2018 to $3.7 billion, up from $2.9 billion for the same period last year, according to industry analyst firm Hyperion Research. Read more…

By Doug Black

House Passes $1.275B National Quantum Initiative

September 17, 2018

Last Thursday the U.S. House of Representatives passed the National Quantum Initiative Act (NQIA) intended to accelerate quantum computing research and developm Read more…

By John Russell

HPC Reflections and (Mostly Hopeful) Predictions

December 19, 2018

So much ‘spaghetti’ gets tossed on walls by the technology community (vendors and researchers) to see what sticks that it is often difficult to peer through Read more…

By John Russell

Intel Confirms 48-Core Cascade Lake-AP for 2019

November 4, 2018

As part of the run-up to SC18, taking place in Dallas next week (Nov. 11-16), Intel is doling out info on its next-gen Cascade Lake family of Xeon processors, specifically the “Advanced Processor” version (Cascade Lake-AP), architected for high-performance computing, artificial intelligence and infrastructure-as-a-service workloads. Read more…

By Tiffany Trader

Germany Celebrates Launch of Two Fastest Supercomputers

September 26, 2018

The new high-performance computer SuperMUC-NG at the Leibniz Supercomputing Center (LRZ) in Garching is the fastest computer in Germany and one of the fastest i Read more…

By Tiffany Trader

Houston to Field Massive, ‘Geophysically Configured’ Cloud Supercomputer

October 11, 2018

Based on some news stories out today, one might get the impression that the next system to crack number one on the Top500 would be an industrial oil and gas mon Read more…

By Tiffany Trader

Microsoft to Buy Mellanox?

December 20, 2018

Networking equipment powerhouse Mellanox could be an acquisition target by Microsoft, according to a published report in an Israeli financial publication. Microsoft has reportedly gone so far as to engage Goldman Sachs to handle negotiations with Mellanox. Read more…

By Doug Black

The Deep500 – Researchers Tackle an HPC Benchmark for Deep Learning

January 7, 2019

How do you know if an HPC system, particularly a larger-scale system, is well-suited for deep learning workloads? Today, that’s not an easy question to answer Read more…

By John Russell

  • arrow
  • Click Here for More Headlines
  • arrow
Do NOT follow this link or you will be banned from the site!
Share This