Trends
IBM reports growth in AI bookings, beating earnings estimates
In the second quarter, IBM’s sales grew by 2% to $15.8 billion, with the software division seeing revenues climb by 7% to $6.7 billion, both exceeding analysts’ expectations.
Headline
In the second quarter, IBM’s sales grew by 2% to $15.8 billion, with the software division seeing revenues climb by 7% to $6.7 billion, both exceeding analysts’ expectations.
Context
OUR TAKE IBM’s strong Q2 results reflect growing enterprise demand for AI technologies. With a focus on consulting and software sales, the company’s generative AI business has reached over $2 billion. The expansion of watsonx and open-sourcing of Granite models underscore IBM’s commitment to AI leadership and capitalising on the market’s growth. –Vicky Wu, BTW reporter International Business Machines Corporation (IBM) has reported a significant increase in bookings for its artificial intelligence business, driven by enterprise customers looking to adopt the latest AI technologies.
Evidence
Pending intelligence enrichment.
Analysis
In the second quarter, IBM’s sales grew by 2% to $15.8 billion, slightly exceeding the average analyst estimate of $15.6 billion. The software division saw revenues climb by 7% to $6.7 billion, surpassing analysts’ expectations. The company reported adjusted earnings of $2.43 per share, well above the consensus estimate of $2.20 per share. Total revenue for the period stood at $15.77 billion, exceeding the expected $15.62 billion. IBM’s net profit for the quarter was $1.83 billion, up from $1.58 billion in the same period last year. IBM’s CEO, Arvind Krishna , noted in an interview that about three-quarters of the AI bookings consist of consulting services, with the remaining portion coming from software sales. He anticipates that over time, the proportion of revenue from software will increase. Also read: IBM to add 800 AI roles in Ireland Also read: IBM unveils open-source AI models and partners with Saudi Arabia
Key Points
- In the second quarter, IBM’s sales grew by 2% to $15.8 billion, with the software division seeing revenues climb by 7% to $6.7 billion, both exceeding analysts’ expectations.
- IBM’s net profit for the second quarter was $1.83 billion, up from $1.58 billion in the same period last year.
Actions
Pending intelligence enrichment.
