IBM reported third-quarter earnings of $2.95 per share, surpassing the expected $2.86, and generated revenue of $17.10 billion, exceeding the $16.82 billion forecast. This represents a 5% year-over-year revenue growth. The net income rose to $2.19 billion from $1.74 billion a year earlier. CEO Arvind Krishna emphasized the transformative impact of 'Super Intelligence' on client operations.
For the full year, IBM anticipates free cash flow to increase by over $1 billion, maintaining its previous guidance. The company projects constant-currency revenue growth of 4% to 5% through 2026. In terms of revenue breakdown, software revenue reached $7.80 billion, up 8%, while consulting revenue remained flat at $5.34 billion, slightly below expectations.
Infrastructure revenue grew 4% to $3.70 billion, exceeding forecasts. However, the adjusted gross margin of 58.5% fell short of the anticipated 59.1%. Additionally, IBM announced plans to acquire Boeing and General Motors' HRL Laboratories. Despite the positive earnings report, IBM's stock has declined 15% year-to-date, contrasting with a 13% gain in the S&P 500 index.
A conference call with executives is scheduled to discuss these results further