IBM revenue jumps 9% thanks to Software, Consulting and Infrastructure

IBM has reported revenue of $15.5 billion (+9 percent) thanks to growth in Software, Consulting and Infrastructure business units during the second quarter of 2022.
IBM’s revenue from Software (includes Hybrid Platform & Solutions, Transaction Processing) rose 6.4 percent to $6.2 billion thanks to increase of 4 percent in Hybrid Platform & Solutions, 12 percent in Red Hat, 4 percent in Automation, 12 percent in Transaction Processing and 14 percent in Software segment hybrid cloud.

IBM’s Consulting (includes Business Transformation, Technology Consulting and Application Operations) revenues rose 9.8 percent to $4.8 billion.

IBM’s Infrastructure (includes Hybrid Infrastructure, Infrastructure Support) revenues rose 19 percent to $4.2 billion thanks to an increase of 34 percent in Hybrid Infrastructure, 69 percent in IBM z Systems, 11 percent in Distributed Infrastructure, and 24 percent in Infrastructure segment hybrid cloud business.

Cloud revenue rose 18 percent to $5.9 billion.

“We delivered good revenue performance with balanced growth across our geographies, driven by client demand for our hybrid cloud and AI offerings,” said Arvind Krishna, IBM chairman and chief executive officer. “With our first half results, we continue to expect full-year revenue growth at the high end of our mid-single digit model.”

IBM CFO James Kavanaugh said both currency headwinds and impact from exiting Russia operations has put pressure on IBM’s near-term results but reiterated the company’s full-year forecast of hitting the upper end of mid-single-digit revenue growth.

“Our recurring revenue stream and solid cash generation position us well to continue to invest in R&D, acquire new companies, and strengthen our talent in every part of the business,” James Kavanaugh said.

IBM expects a foreign exchange hit to revenue of about 6 percent this year. It had previously forecast a 3 percent-4 percent hit.

IBM said second-quarter revenue was hurt by $900 million due to a stronger U.S. dollar.

IBM sees revenue growth, including in regions like Europe and Asia Pacific, despite geopolitical turmoil and inflationary pressures, James Kavanaugh said, echoing words of peer Accenture, which had last month said it does not foresee a pull back in client spending.

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