IBM's shares took a nosedive yesterday evening after posting Q1 results one analyst described as a "car crash".
For the three months to 31 March, GAAP net income from continuing operations fell 17 per cent year on year to $2bn (£1.4bn), on as-reported revenue of $18.7bn, which fell five per cent over the same period.
Forbes reports that in after-hours trading, IBM shares were trading 2.48 per cent lower than they did at market close.
All five divisions at Big Blue slumped in Q1: the Cognitive Solutions arm's sales toppled 1.7 per cent annually to $4bn, while the Global Business Services division – home to IBM's consulting and application management kit – saw sales slide 4.3 per cent to $4.1bn over the same period.
Sales at IBM's Technology Services and Cloud Platforms business slumped 1.5 per cent year on year to $8.4bn, but its Systems unit fared much worse as revenue plummeted 21.8 per cent to $1.7bn. Its Global Financing business also suffered double-digit annual decline, with sales falling 11.2 per cent to $410m.
Despite this, IBM's chief executive Ginny Rometty said she is "pleased with progress", particularly regarding the company's "strategic imperatives", which consists of cloud, analytics and engagement kit.
IBM boasted that this section of the business rose 14 per cent annually to $7bn, adding that sales from cloud rocketed 34 per cent to $2.6bn.
TechMarketView's managing partner Anthony Miller said this news is hardly worth celebrating.
"None of this is actually good news," he said. "Why? Because the faster that all this disruptive stuff grows, the faster it erodes traditional services revenues and profits. That's not true just for IBM – that's just true.
"IBM's Q1 results look like a car crash! Everything's down and they're even losing money on servers."
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