IBM Is Still Big Tech’s Dog

When International Business Machines Corp. (NYSE: IBM) posted its latest earnings, its stock did what it usually does after the announcement. It fell. And it fell on a day when the market in general soared. IBM seems to think people should be impressed by 9% revenue growth in a double-digit growth tech world.

IBM’s revenue reached $15.5 billion, which is extremely small by big tech standards. IBM’s financial reporting is messy and hard to decipher. Often it mentions percentages without dollar amounts, which is a good way to obscure real performance. The quarterly report posted some figures quarter over quarter and others year over year. IBM’s management should be ashamed.

IBM is most proud of its cloud business. The closest an observer can come to the performance of this division is that “infrastructure” division revenue rose by 19% to $4.2 billion. Some hybrid numbers appear to be rolled into other divisions.

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A good way to look at how poorly IBM is doing is to examine one of the cloud computing leaders. In the most recent quarter, Microsoft had revenue of $49.9 billion, up 18%. “Intelligent cloud” revenue rose to $19.1 billion from $15.1 billion, an increase of 26%.

A final note. IBM’s market cap is $117 billion. Microsoft’s is $1.8 trillion.

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