Q2 2024 International Business Machines Corp Earnings Call Transcript
Key Points
- International Business Machines Corp (IBM) delivered a strong quarter, exceeding expectations in revenue growth, profitability, and cash flow generation.
- The company reported 15.8 billion in revenue and a 17% increase in operating pretax income, highlighting strong execution.
- Software revenue grew by 8%, driven by solid growth across hybrid platform and solutions, and transaction processing.
- Infrastructure revenue was up 3%, with IBM Z and distributed infrastructure showing strong performance.
- IBM raised its expectations for free cash flow to greater than $12 billion for the year, reflecting confidence in its financial performance.
- Consulting revenue growth was only 2%, impacted by a pullback in discretionary spending.
- Despite strong performance in software and infrastructure, consulting remains below the model, reflecting ongoing challenges.
- The macroeconomic environment, including factors like interest rates and inflation, continues to impact decision-making and discretionary spending.
- IBM's consulting segment faced continued pressure on spending related to discretionary projects, leading to a more conservative growth outlook.
- The geopolitical uncertainty and prolonged inflation have created a challenging environment, affecting client spending and project prioritization.
Please stand by for streaming text
Welcome and thank you for standing by. At this time. All participants are in a listen only mode. Today's conference is being recorded. If you have any objections, you may disconnect at this time. Now I will turn the meeting over to Olympia McNerney, IBM's global head of Investor Relations. Olympia, you may begin.
Thank you. I'd like to welcome you to IBM Second Quarter 2020 for earnings presentation. I'm LMP McNerney, and I'm here today with Arvind Krishna, IBM's Chairman and Chief Executive Officer, and Jim Kavanaugh, IBM's Senior Vice President and Chief Financial Officer, will post today's prepared remarks on the IBM investor website within a couple of hours, and a replay will be available by this time tomorrow to provide additional information to our investors. Our presentation includes certain non-GAAP measures. For example, all of our references to revenue and signings growth at constant
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