IBM sales grow to $26bn

Software boosts vendor's latest financial results

Strong software sales enabled IBM to end its financial year on a high with fourth-quarter results revealing a rise in total revenue of seven per cent to $26.3bn (£13.2bn).

Full year results increased four per cent to $91.4bn (£46bn), also driven by performance in the software group, which posted its best results in five years of $18.2bn (£9.2bn).

All regions showed growth in the fourth quarter, with Asia Pacific and the Americas growing five per cent, although Europe witnessed a more modest three per cent rise.

Ovum analyst Ian Wesley says growth in software revenues of 11 per cent to $5.6bn (£2.8bn) was fuelled by IBM’s branded middleware and software, including WebSphere, Tivoli and Lotus, which rose 21 per cent to represent 56 per cent of its software business.

‘IBM estimates that this was double overall market growth, with growth both organic and through acquisition in roughly equal measure,’ said Wesley.

‘Its success was balanced by a decline in operating systems and other middleware, hit by the general decline in mainframe software prices.’

In other divisions, systems and technology sales were flat at $7.1bn (£3.6bn), global technology services rose four per cent to $8.6bn (£4.3bn) and global business services increased four per cent to $4.2bn (£2.1bn).

IBM chief executive Sam Palmisano says the company has had a terrific quarter, with record cash performance, profit and payouts to shareholders.