IBM Delivers Strongest Growth in 3 Years

IBM shares rose as much as 4 percent in extended trading early this week after the enterprise technology and services provider posted the strongest quarterly growth in three years.

The company reported a Q2 2021 profit of $2.33 per-share, $0.04 higher than estimates, while revenue rose a modest 3.4 percent year-over-year to $18.75 billion, $400 million higher than consensus.

Cloud and Cognitive Software division income rose 6 percent year-over-year while Global Business services added 12 percent. IBM reported $27 billion in total cloud revenue in the last 12 months, marking a 15 percent year-to-year improvement. It posted less spectacular results in the most recent quarter, with $7 billion yielding a 13 percent gain. Red Hat revenue grew a respectable 20 percent in the sixth full quarter since the company was acquired in a $34 billion transaction.

In the quarter IBM spent $1.75 billion on acquisitions, the most in a single quarter since it closed the $34 billion Red Hat deal in the third quarter of 2019. It said it was acquiring process-mining software company myInvenio, application-management company Turbonomic and Salesforce consulting company Waeg. The company also announced 2-nanometer chip technology, as well as new artificial-intelligence features for its Watson Studio software for building models.