by Staff Writers
New York (AFP) April 19, 2010
US computer giant IBM lifted its earnings outlook for the year on Monday after posting better-than-expected first quarter results on revived technology spending.
The Armonk, New York-based company said net profit grew 13 percent in the first quarter over a year ago to 2.6 billion dollars.
Revenue increased five percent to 22.9 billion dollars, slightly better than the 22.75 billion dollars forecast by Wall Street analysts.
Earnings per share of 1.97 dollars were better than the 1.93 dollars expected by analysts.
"We drove significantly improved revenue growth rates from the fourth quarter across our businesses and geographies," IBM chairman, president and chief executive Samuel Palmisano said in a statement.
"Looking ahead, we are confident in our ability to grow revenue, and given our mix of higher-value business and productivity we will expand margins, grow profit, cash and EPS (earnings per share)," he said.
Palmisano said he expected full-year earnings per share of at least 11.20 dollars, better than the 11.00 dollars forecast previously and the 11.12 dollars expected by analysts.
"I feel good about the guidance and the business," IBM chief financial officer Mark Loughridge told analysts in a conference call.
IBM was the latest technology company to report improved results. Intel, the world's biggest computer chip maker, last week posted a nearly four-fold rise in quarterly net profit.
As the world's top chipmaker, Intel's fortunes are closely linked to those of the computer market and overall technology spending.
IBM said software revenue was up 11 percent in the quarter which ended on March 31 while Systems and Technology revenue rose five percent and services revenue gained four percent.
IBM said revenue from the Americas grew two percent while revenue from Europe, the Middle East and Africa was five percent higher. Asia-Pacific revenue increased 10 percent.
IBM said it ended the first-quarter 14 billion dollars of cash on hand.
"Growth is returning," said analyst Louis Miscioscia of Collins Stewart. "Finally large corporates are starting to spend again."
IBM shares were selling 2.02 percent lower at 129.56 dollars in after-hours electronic trading.
Space Technology News - Applications and Research
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