IBM beats by $0.05, reports revs in-line; reaffirms FY15 EPS guidance, raises FCF modestly
Reports Q2 (Jun) earnings of $3.84 per share, excluding non-recurring items, $0.05 better than the Capital IQ Consensus of $3.79; revenues fell 13.4% year/year to $20.81 bln vs the $20.94 bln consensus.
Down 1% year-to-year adjusting for currency and the divested System x business (9 points and 4 points, respectively); down 13% as reported;
Strategic imperatives revenue up more than 30% adjusting for currency and the divested System x business; up more than 20% as reported;
Cloud revenue up more than 70% adjusting for currency and divested businesses; up more than 50% as reported;
For cloud delivered as a service, annual run rate of $4.5 bln compared to $2.8 bln in the second quarter of 2014;
Business analytics revenue up more than 20% adjusting for currency; up more than 10% as reported.
Adj. gross margin +20 bps to 50.9%
Co reaffirms guidance for FY15, sees EPS of $15.75-16.50, excluding non-recurring items, vs. $15.84 Capital IQ Consensus.
IBM now expects a modest increase in free cash flow, improved from its prior expectation of flat year-to-year performance.