22 January, 2015
Cloud Business Is Bright Spot In Otherwise Downbeat IBM Earnings
IBM is pursuing an aggressive plan to refocus on cloud services and analytics under CEO Virginia Rometty (right), but revenues are not materializing fast enough to offset the massive declines across the legacy businesses that still make up for the bulk of its revenues. That is reflected all too clearly in the company’s newly fourth quarter earnings, which were released earlier this week.
Big Blue experienced declines in every major division and most notably in the hardware group, which saw revenue plummet a massive 39 percent from last year to $2.4 billion. The revenue figure results may have been depressed by the company’s offloading of its unprofitable commodity server portfolio to Lenovo Group Ltd. in September. Nevertheless, demand for the high-end Power machines that the company held onto following the deal dropped 13 percent, while storage revenue fell 8 percent.