Slow services growth and weak euro hit IBM revenue

Profits up nine per cent, but services signings dropped 12 per cent

Technology giant IBM reported revenue up two per cent for the second quarter of 2010, at $23.7bn (£15.6bn) compared with the same quarter last year.

Profits were up nine per cent compared with Q2 2009 at $3.4bn.

But services signings at $12.3bn were down 12 per cent, signifying that enterprises could still be holding back on major IT projects.

IBM also said the weak euro cost it $500m, since just under a third of its income comes from Europe.

Revenue from the EMEA region were down six per cent at $7.4bn, but once currency adjusted were down just one per cent.

For the Americas region, revenue grew slightly at three per cent (two per cent currency adjusted) to $10.2bn, while Asia-Pacific revenue increased nine per cent (three per cent currency adjusted).

IBM chief executive Samuel Palmisano said that IBM's mix of higher-value business and the introduction of new System Z and Power Systems gave it confidence for the second half of the year.

Global Technology Services segment revenue was up one per cent to $9.2bn, with Global Business Services segment revenue up three per cent at $4.5bn (£3.5bn).

IBM’s key middleware product revenue, including WebSphere, Information Management, Tivoli, Lotus and Rational products increased nine per cent to $3.3bn over Q2 2009.

Operating systems revenue grew three per cent to $544m compared to the same quarter in 2009.