NEW YORK, Jan 19 (Reuters) – IBM <IBM.N> raised its 2010
profit target and reported a stronger-than-expected 9 percent
increase in fourth-quarter earnings, as cost cuts and a shift
to more profitable contracts helped it weather a slump in
corporate spending. IBM's share price fell 2 percent after the results, however, making clear that investors wanted even more from a company whose stock had rallied nearly 60 percent in the past year. Moreover, IBM has set a high bar for itself -- the world's leading technology services company has not missed earnings estimates since 2005. "I think there were some pretty big expectations built in, and you really needed to wow it," Stephen Massocca, managing director at Wedbush Morgan, said after the results were issued on Tuesday. Ted Parrish, co-portfolio manager at Henssler Equity Fund, added: "While I think the long-term prospects for the company are good, I think the shares are a bit frothy, not overvalued but I would say the stock isn't going to do as well as it did in 2009." International Business Machines Corp's results come just days after another technology powerhouse, Intel Corp <INTC.O>, also posted results that topped expectations. And while IBM's results failed to excite investors, they do add to evidence that corporate technology spending is recovering. The also indicate that IBM's efforts to cut costs and accelerate its shift to services and software businesses that offer higher margins are paying dividends. The company said it now expects profit of at least $11 a share in 2010 compared with its previous target of $10 to $11 per share. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a graphic on IBM's earnings, please click here ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ "IBM is just a machine. Throughout the downturn, they have provided consistent results and this is no different," said Andy Miedler, an analyst with Edward Jones. IBM's fourth-quarter profit rose 9 percent to $4.8 billion, or $3.59 a share, from $4.4 billion, or $3.27 a share, a year earlier. Analysts on average had expected a profit of $3.47 per share, according to Thomson Reuters I/B/E/S. Total gross profit margin rose to 48.3 percent, up 0.4 points, in the quarter. Quarterly revenue rose 1 percent to $27.2 billion, surpassing estimates. IBM also forecast more revenue growth in the first quarter. "The unique portfolio of businesses we built, heavily weighted toward software and services, generates high profitability," Chief Financial Officer Mark Loughridge said on a conference call. Services contracts totaled $18.8 billion in the fourth quarter, an increase of 9 percent, including 22 contracts worth more than $100 million. Service contract signings are an indicator of long-term sales. "There is far more for the global economy to go and there is a significant amount of acceleration that is going on in the global economy, and IBM will be a beneficiary of that," said Peter Misek, an analyst with Canaccord Adams. Shares of IBM fell 2 percent, after ending regular trading at $134.14, up $2.36, on the New York Stock Exchange. (Additional reporting by Jim Finkle in Boston; Editing by Paul Thomasch and Richard Chang)
NEW YORK (Reuters) – IBM’s quarterly results should show a solid recovery in technology spending, but investors will likely want reassurance of stronger growth in 2010 before pushing its stock price much higher.
Shares of International Business Machines Corp have risen almost 60 percent in the past year as the company sidestepped the worst of the downturn by cutting costs and shifting its business mix to more profitable services and software.
NEW YORK/SAN FRANCISCO, Jan 13 (Reuters) – Global shipments
of personal computers surged in the fourth quarter, helped by
strong U.S. holiday sales of low-cost notebooks.
The results capped a roller coaster year for the PC market,
which started off badly but showed steady improvement and
managed to post growth over 2008.
NEW YORK (Reuters) – U.S. network equipment maker Cisco Systems Inc <CSCO.O> is restructuring its management in Asia to create a new segment for China, in a nod to the region’s increasing importance.
Cisco said China, Hong Kong and Taiwan, formerly part of its Asia Pacific operations, would become a separate “Greater China Theater”, effective February.
NEW YORK/LAS VEGAS (Reuters) – Network equipment maker Cisco Systems Inc plans to begin selling later this year a long-awaited, affordable home version of its TelePresence videoconferencing system for corporations.
Cisco said it would team up with phone and Internet service provider Verizon Communications Inc to install the system in U.S. homes. Field trials begin this spring, it said.
NEW YORK (Reuters) – The head of network equipment maker Avaya Inc <AVXX.UL> said its purchase of some Nortel Networks Corp <NRTLQ.PK> assets will boost market share and help a potential initial public offering or some other type of exit by its private equity owners.
Avaya, bought by Silver Lake and TPG Capital in 2007, on Friday closed its acquisition of Nortel’s corporate networks unit. It paid $900 million for the business and $15 million for employee retention.
NEW YORK (Reuters) – Technology outsourcing and consulting company Accenture Plc <ACN.N> reported a fall in first-quarter earnings and gave a sales outlook for the current quarter that was weaker than analysts’ expectations.
The company also saw no economic impact from rebranding after terminating its sponsorship arrangement with golfer Tiger Woods, who has admitted to infidelity in his marriage.
SAN JOSE, Dec 9 (Reuters) – When Ned Hooper joined Cisco
Systems Inc <CSCO.O> after the company he worked for was bought
by the U.S. network equipment giant, he didn’t think he would
stay beyond an initial two-year commitment.
Not only did Hooper stay for 12 years, he also rose through
the ranks to become Cisco’s chief strategy officer and a top
contender to succeed Chief Executive John Chambers.
SAN JOSE (Reuters) – Cisco Systems Inc’s <CSCO.O> CEO John Chambers reaffirmed the network equipment maker’s long-term target of 12-17 percent annual revenue growth, citing an economic recovery and expansion into new markets.
Cisco has fallen short of such growth rates in the past year as customers cut back on technology spending, but Chambers, at a financial analyst conference, said conditions had improved in recent quarters.
SAN JOSE (Reuters) – Cisco Systems Inc <CSCO.O> Chief Executive John Chambers reiterated the company’s long-term target of 12 percent to 17 percent annual revenue growth, citing an economic recovery and expansion into new markets.
The top network equipment maker has fallen short of such growth rates in the past year as customers cut back on technology spending, but Chambers, at a financial analyst conference, said conditions had improved in recent quarters.