IBM delivers solid results
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Strong full-year results for the technology giant.
20 January 2005Technology giant IBM has reported strong full-year results for 2004, but the leap in revenues owes at least as much to the weak dollar as reinvigorated corporate IT spending.
IBM is often regarded as a bellwether for the entire IT industry; as such signs of growing revenues are often seized upon as a sign of a healthy industry.
Indeed IBM's revenues for 2004 totalled $96.5 billion, up 8% from $89.1 billion in 2003. Taking the positive effect of currency into consideration, worldwide revenue growth only increased by 4%, however.
IBM reported solid gains in hardware sales, up 7% when currency fluctuations are accounted for; its software and services business reported more modest growth.
On the back of this, IBM's chief financial officer, Mark Loughridge, said in conference call he expected modest improvement in the IT business and predicted worldwide spending to increase by 4% to 6% in 2005
A recent survey of 1,300 CIOs by analyst group Gartner found that most expected IT budgets to increase by just 2.5% in 2005. IBM must be either relying on a different analysis, or planning to win a greater share of IT spending to meet its forecasts.
IBM's full-year results were helped by strong fourth quarter results. Revenues totalled $27.7 billion, an increase of 7% on the same quarter last year and income for the quarter was $3.1 billion, the best results in the company's history and up 12% from $2.7 billion in the same period last year.
