IBM results: Revenue jumps 6% in Q4, beats expectations

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Revenue: The company reported a revenue of $16.70 billion in Q4 beating street estimates of $15.96 billion. The revenue from operations increased 6.5% year-on-year. In constant currency terms, the revenue was up 8.6%. The revenue from the Hybrid cloud business increased by 16% to $6.2 billion. Software in Q4 bought in revenue of $7.3 billion, an increase of 8.2%.  Within Software, Hybrid Platform & Solutions was up 7%. That includes Red Hat(up 19%), Automation (up 13%), Data & AI (up 1%) and Security (down 2%). 

Net income rises: The net income increased by 72% from $2.33 billion in Q3. The Earning Per Share was $3.35 (adjusted), which was higher than a street estimate of $3.30. The gross margins decreased from 58.9% to 56.9%.

IBM Q4 results review

IBM reported a strong Q4 number after the modest growth in the previous quarter. The company has reported 22 straight quarters of negative revenue growth. Hence, the current numbers come as a surprise to investors. The CEO, Arvind Krishna said, "our fourth-quarter results give us confidence in our ability to deliver our objectives of sustained mid-single digit revenue growth and strong free cash flow in 2022." 

Target Price:  The 16 analysts offering 12-month price forecasts for International Business Machines Corp have a median target of 144.26, with a high estimate of 164.29 and a low estimate of 115.00. IBM's shares closed 1.35% down at $134.26 on Wednesday.