2017.10.1802:50:00UTC+00IBM’s Business Shift Strategy Delivers Strong Results

International Business Machines Corp. posted better-than-expected quarterly results as its change of focus towards newer businesses helped it beat analysts' estimates.

Revenue from new units including cloud and security services and data analytics increased 11 percent to $8.8 billion in the third quarter ended September 30, representing around 46 percent of the firm's overall total revenue.

The company has been focusing on these new businesses it calls “strategic imperatives” to offset a slowdown in its hardware and software businesses.

Cognitive solutions business revenue increased by almost 4 percent to $4.40 billion, recovering from a 2.5 percent decline in the preceding period. Revenue in the mainframe business rose 60 percent in the third quarter.

There was a general consensus that revenue would clock in at $4.17 billion, FactSet said. IBM said it anticipates revenue to increase to $2.8 billion to $2.9 billion in the fourth quarter from the third quarter.

This estimate indicates Q4 revenue will be in the range of $22 billion to $22.1 billion, denoting an annual increase of 1.4 percent at the high end of the range.

The company retained its 2017 forecast for 2017 of at least $13.80 per share, slightly lower than the expected EPS of $13.75.