International Business Machines Corp (IBM) has reported a 13.11 percent fall in profit for the quarter ended Mar. 31, 2017. The company has earned $1,750 million, or $1.85 a share in the quarter, compared with $2,014 million, or $2.09 a share for the same period last year. On an adjusted basis, earnings per share were at $2.38 for the quarter compared with $2.35 in the same period last year.
Revenue during the quarter went down marginally by 2.83 percent to $18,155 million from $18,684 million in the previous year period. Gross margin for the quarter contracted 368 basis points over the previous year period to 42.81 percent. Total expenses were 91.56 percent of quarterly revenues, down from 92.33 percent for the same period last year. This has led to an improvement of 77 basis points in operating margin to 8.44 percent.
"In the first quarter, both the IBM Cloud and our cognitive solutions again grew strongly, which fueled robust performance in our strategic imperatives," said Ginni Rometty, IBM chairman, president and chief executive officer. "In addition, we are developing and bringing to market emerging technologies such as blockchain and quantum, revolutionizing how enterprises will tackle complex business problems in the years ahead."
For fiscal year 2017, International Business Machines Corp projects diluted earnings per share to be $11.95. It expects diluted earnings per share to be $13.80 on adjusted basis for the same period.
Operating cash flow drops significantly
International Business Machines Corp has generated cash of $3,955 million from operating activities during the quarter, down 28.48 percent or $ 1,575 million, when compared with the last year period.
Cash flow from investing activities was $350 million for the quarter as against cash outgo of $1,886 million in the last year period.
The company has spent $2,134 million cash to carry out financing activities during the quarter as against cash inflow of $2,806 million in the last year period.
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