IBM reports record Q4 earnings

IBM last week reported record diluted earnings of $US2.47 per common share in the fourth quarter of 1998, up 17 percent from a year ago, with net income of $2.3 billion.

In the year-ago quarter, IBM reported diluted earnings per common share of $2.11 with net income of $2.1 billion.

The computer giant beat the consensus expectation from 21 analysts polled by First Call who predicted diluted earnings of $2.45. IBM's ongoing emphasis on service and software led to the record quarterly financial results, company officials said at a teleconference last week.

Revenue in the fourth quarter of 1998 also set a record, hitting $25.1 billion, up 6 percent compared to the year-ago quarter.

Software revenues were $4.1 billion, up 9 percent from a year ago, with strong showings in database, transaction processing and management products from subsidiary Tivoli Systems. Shipments of Notes seats from subsidiary Lotus Development also reached record numbers in the fourth quarter with over 5 million seats.

Services revenues were $7.1 billion, a jump of 20 percent over a year ago. Services revenues grew more than $1 billion over the year-ago quarter and the service's unit inked more than $9 billion in contracts in the fourth quarter.

Hardware sales dipped 2 percent from the year ago quarter to $11.3 billion.

Globally, IBM reported North American revenues of $11.3 billion, up 8 percent from the year-ago quarter. Revenues from Europe, the Middle East and Africa were $8.7 billion, for an increase of 13 percent. Asia-Pacific revenues dropped 3 percent to $4.2 billion and revenues in Latin America dipped 22 percent to $929 million.

On a calendar year basis, IBM reported net income of $6.3 billion for 1998 or $6.57 per diluted common share, which was a record, the company said. Those figures compare to 1997 calendar figures of $6.1 billion net income or $6.01 per diluted common share.

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