SAN FRANCISCO (AP) — IBM Corp.'s fourth-quarter earnings handily beat Wall Street's expectations on Thursday, helped by higher revenue from the technology icon's lucrative software and services segments.
The results and a stronger-than-expected earnings outlook for the year sent IBM's stock more than 3 percent higher after hours. It was a welcome sign of stability amid the global economic turmoil that's prompting worries about a slowdown in technology spending among businesses and government agencies.
IBM earned $5.49 billion, or $4.62 per share, in the three months that ended Dec. 31. That's up 4 percent from $5.26 billion, or $4.25 per share, a year earlier. Adjusted earnings were $4.71 per share, handily surpassing analysts' expectations, though revenue fell short.
IBM said its revenue grew 2 percent to $29.49 billion from $29.02 billion.
Analysts polled by FactSet had expected adjusted earnings of $4.61 per share and revenue of $29.7 billion.
For the full year, IBM is forecasting adjusted earnings of at least $14.85 per share, well above the $13.36 per share that analysts are expecting.
New CEO Ginni Rometty said IBM is "well on track" toward its long-term goal of hitting at least $20 per share in adjusted earnings in 2015 — a rare example of a long-term earnings target disclosed publicly by a such a large company.
The Armonk, N.Y., company's stock rose $6.20, or 3.4 percent, to $186.72 in after-hours trading. The stock had closed down 55 cents at $180.52.