IBM shares climb on earnings beat

Investing.com -- IBM shares rose more than 4% in after-hours trading on Wednesday, adding to a 3.96% gain during regular trading hours after the company reported third-quarter results that exceeded Wall Street expectations.

The technology company posted earnings per share of $2.95, beating the analyst estimate of $2.86 by $0.09. Revenue reached $17.1 billion, above the consensus estimate of $16.82 billion.

IBM raised its full-year free cash flow outlook. The company now expects full-year free cash flow to increase by more than $1 billion year-over-year. IBM maintained its full-year constant currency revenue growth outlook in the range of 4% to 5%. At current foreign exchange rates, currency is expected to be neutral to growth for the year.

"Disciplined execution throughout the quarter drove accelerated revenue growth and strong free cash flow. Our clients are now deploying Super Intelligence in ways that transform entire operating models, instead of simply addressing narrow or novel problems. IBM's technology and expertise are helping organizations drive growth and serve customers with greater speed, precision and efficiency than ever before," said Arvind Krishna, IBM chairman, president and chief executive officer.

The Software segment generated revenues of $7.8 billion, up 8%, or 9% at constant currency. Within this segment, Hybrid Cloud revenues rose 11%, Data increased 19%, and Transaction Processing climbed 9%. Automation revenues declined 3%.

Consulting revenues came in at $5.3 billion, flat year-over-year but up 2% at constant currency. Strategy and Technology revenues rose 2%, while Intelligent Operations declined 2%.

Infrastructure revenues totaled $3.7 billion, up 4%, or 5% at constant currency. Distributed Infrastructure jumped 31%, while IBM Z fell 20%. Infrastructure Support decreased 3%.

Financing revenues reached $0.2 billion, down 4%, or 3% at constant currency.

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