Web Software Boosts IBM Results

IBM announced on 19 April that its profits are up 13 percent for its first quarter of 2010.

In its earnings announcement, IBM said, “First-quarter net income was $2.6 billion (£1.7bn) compared with $2.3 billion in the first quarter of 2009.” Meanwhile, total revenues topped off at $22.9 billion for the first quarter of 2010, an increase of 5 percent over the first quarter of 2009.

IBM officials said software was a key driver of IBM profits for the first quarter. Indeed, revenues from IBM’s Software Group were “$5.0 billion, an increase of 11 percent … compared with the first quarter of 2009. Revenues from IBM’s key middleware products, which include WebSphere, Information Management, Tivoli, Lotus and Rational products, were $2.8 billion, an increase of 13 percent … versus the first quarter of 2009. Operating systems revenues of $499 million increased 1 percent … compared with the prior-year quarter,” IBM said.

WebSphere Increased 13 Percent

More specifically: “Revenues from the WebSphere family of software products, which delivers capabilities that enable clients to integrate and manage business processes across the organisation, increased 13 percent year over year. Revenues from Information Management software, which enables clients to integrate, manage and use information to gain business value, increased 11 percent. Revenues from Tivoli software, which helps clients manage technology and business assets by providing visibility, control and automation across the organisation, increased 23 percent, and revenues from Lotus software, which connects people and processes for more effective communication and increased productivity through collaboration, messaging and social networking software, increased 1 percent. Revenues from Rational software, which supports software development for both IT and embedded system solutions, increased 7 percent.”

“In the first quarter, we drove significantly improved revenue growth rates from the fourth quarter across our businesses and geographies,” Sam Palmisano, IBM chairman, president and CEO, said in a statement. “We had strong results in strategic investment areas including growth markets, business analytics and Smarter Planet solutions. 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, and increase returns to shareholders.”

In terms of the geographic breakdown for IBM’s first-quarter earnings, the Asia-Pacific region saw the most growth, rising to $5.3 billion in an increase of 10 percent. Revenues from the Europe/Middle East/Africa region were $7.6 billion, up 5 percent, and Americas first-quarter revenues were $9.5 billion, an increase of 2 percent.