IBM reported another quarter of better-than-expected results on Monday, driven by its expansion into newer businesses like the cloud and analytics, but said sales still slipped from a year ago.
During the third quarter, Big Blue's adjusted earnings came in at $3.29 per share, topping Wall Street analyst estimates of $3.24 per share. Revenue edged down just 0.3% to $19.2 billion, which beat analyst estimates of $19.0 billion, but represented its 18th straight quarter of declining sales.
IBM has been gunning for progress on its so-called strategic imperatives, which includes areas like the cloud, analytics, security and artificial intelligence. This part of the business saw revenues grow 16% to $8 billion during the quarter, and it now accounts for 40% of the company's overall revenue.
IBM CEO Ginni Rometty took the opportunity to boast in her prepared remarks: "Whether it is banks implementing IBM blockchain solutions, hospitals leveraging Watson to fight cancer, or retailers using cognitive apps built on the IBM Cloud to transform the customer experience, clients across all industries are tapping into a new kind of innovation value from IBM."
Rometty is leading the charge into these growing areas in order to offset declines in IBM's legacy hardware, software and services business. In the third quarter, systems revenue fell 21% to $1.6 billion.
In pursuit of growth, Big Blue has also been throwing money at acquisitions and in September it announced its purchase of Promontory Financial Group, which it intendeds to incorporate into its Watson supercomputer. It's been beefing up its cloud capabilities too and during the quarter closed deals with companies including Pratt & Whitney, Sky Broadcasting and Vodafone India.
On Monday, IBM reiterated its full-year forecast for 2016 and said it still expects non-GAAP earnings of at least $13.50 per share.
Shares of IBM, which have climbed 13% this year, fell 3% to $149 per share in after-hours trading.
