International Business Machines
The 10-second takeaway
For the quarter ended June 30 (Q2), International Business Machines missed slightly on revenues and whiffed on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share increased. GAAP earnings per share dropped.
Gross margins expanded, operating margins shrank, net margins dropped.
International Business Machines booked revenue of $24.92 billion. The 21 analysts polled by S&P Capital IQ expected revenue of $25.33 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $3.91. The 19 earnings estimates compiled by S&P Capital IQ anticipated $3.78 per share. Non-GAAP EPS of $3.91 for Q2 were 11% higher than the prior-year quarter's $3.51 per share. GAAP EPS of $2.91 for Q2 were 13% lower than the prior-year quarter's $3.34 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 48.7%, 110 basis points better than the prior-year quarter. Operating margin was 16.7%, 390 basis points worse than the prior-year quarter. Net margin was 12.9%, 220 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $25.05 billion. On the bottom line, the average EPS estimate is $3.95.
Next year's average estimate for revenue is $103.32 billion. The average EPS estimate is $16.64.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 4,387 members out of 4,824 rating the stock outperform, and 437 members rating it underperform. Among 1,080 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,024 give International Business Machines a green thumbs-up, and 56 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on International Business Machines is outperform, with an average price target of $220.95.
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