Software and Consulting Led Revenue Growth; Strong Gross Profit Margin Expansion
ARMONK, N.Y., April 19, 2023 /PRNewswire/ — IBM (NYSE: IBM) today announced first-quarter 2023 earnings results.
“Our first quarter results demonstrate that clients continue turning to IBM for our unique combination of an open hybrid cloud platform, enterprise-focused AI, and business expertise to unlock productivity and drive efficiency in their operations,” said Arvind Krishna, IBM chairman and chief executive officer. “This gives us confidence in our current growth expectations for revenue and free cash flow for the year.”
First-Quarter Highlights
- Revenue
– Revenue of $14.3 billion, up 0.4 percent, up 4.4 percent at constant currency
– Software revenue up 3 percent, up 6 percent at constant currency
– Consulting revenue up 3 percent, up 8 percent at constant currency
– Infrastructure revenue down 4 percent, flat at constant currency - Cash Flow
– Net cash from operating activities of $3.8 billion, up $0.5 billion; free cash flow of $1.3 billion, up $0.1 billion
| FIRST QUARTER 2023 INCOME STATEMENT SUMMARY | ||||||||||||||||||
| Results include impact of charges for stranded costs related to portfolio actions* | ||||||||||||||||||
| Pre-tax | Diluted | |||||||||||||||||
| Gross | Pre-tax | Income | Net | Earnings | ||||||||||||||
| Revenue | Profit | Income* | Margin* | Income* | Per Share* | |||||||||||||
| GAAP from Continuing Operations |
$ | 14.3B | $ | 7.5B | $ | 1.1B | 7.4 | % | $ | 0.9B | $ | 1.02 | ||||||
| Year/Year | 0.4 | %** | 2 | % | 70 | % | 3.0 | Pts | 41 | % | 40 | % | ||||||
| Operating (Non-GAAP) |
$ | 7.7B | $ | 1.4B | 10.2 | % | $ | 1.2B | $ | 1.36 | ||||||||
| Year/Year | 2 | % | (4) | % | (0.5) | Pts | (2) | % | (3) | % | ||||||||
| * Results include the impact of charges for stranded costs related to portfolio actions. YTY impact of charges for GAAP and Operating (Non-GAAP) results: Pre-Tax Income ($0.25B); Pre-Tax Income Margin (1.8 Pts); Net Income ($0.20B); EPS ($0.22). |
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| ** 4% at constant currency | ||||||||||||||||||
“In the quarter, we remained focused on the fundamentals of our business, increasing productivity and generating operating leverage,” said James Kavanaugh, IBM senior vice president and chief financial officer. “As a result, we again expanded our gross profit margin, improved our underlying profit performance and increased our cash generation. We are well-positioned to continue investing for growth and returning value to shareholders through dividends.”
