American multinational technology company International Business Machines Corporation (IBM) published its Q2 revenue on Monday. The figures surpassed analysts’ estimates as the company witnessed growth in its cloud and consulting businesses.
The company’s Chief Financial Officer James Kavanaugh told Reuters that “with the reopening (of economies) in particular around North America and Western Europe, we’re seeing a nice rebound in travel and transportation, automotive, industrial and consumer sectors overall”, emphasizing that more clients spent on digitizing their operations.
As a result of the pandemic, the existing business models of many companies became obsolete. Businesses are adopting a “hybrid cloud” which is a combination of using their own data centers and leased computing resources to manage and process data.
IBM is leveraging the market opportunity in “hybrid cloud” as the company has been making huge investments in cloud and artificial intelligence-focused ventures.
According to the company’s Chief Financial Officer James Kavanaugh, IBM has spent around $3 billion on eight acquisitions since the year started.
Sales at IBM’s cloud business jumped 13% to $7 billion in the second quarter. The company’s net income fell to $1.33 billion, or $1.47 per share, in the quarter ended June 30, from $1.36 billion, or $1.52 per share, from the previous year. Total revenue rose 3% to $18.75 billion, surpassing estimates of $18.29 billion, according to IBES data from Refinitiv.
Earlier this month, IBM announced that Jim Whitehurst will be stepping down from his position as President of the company. Jim Whitehurst was appointed President of the company in January of 2020 and before that, he played a fundamental role in the company’s $34 billion acquisition of Red Hat – the company’s largest acquisition, in 2019. He will continue to work in the company as a senior adviser to the company’s Chief Executive Officer – Arvind Krishna and the executive leadership team.
The company’s shares were up 2% at $140.73 in extended trading.