IBM latest to fall foul of rising dollar in EMEA results

Big Blue sees sales drop by nearly a fifth in EMEA despite claiming 'a strong start to the year'

IBM has become the latest US vendor to suffer from the rising dollar, with it posting an as-reported drop in EMEA sales by nearly a fifth for its first quarter.

Big Blue's turnover across EMEA in Q1 fell 19 per cent year on year to $6.1bn (£4.1bn). At constant currencies, sales fell just two per cent. The strong dollar also wreaked havoc with the vendor's performance in the Asia-Pacific territory, where sales were also down only two per cent when adjusted for currency, but fell 18 per cent on an as-reported basis to $4.1bn.

In the Americas, meanwhile, IBM's $9.3bn top line represented a three per cent reduction on the reported figure from Q1 last year, but actually translated to two per cent growth in constant currencies. The overall top line – which would have been flat at constant currencies – dropped 12 per cent in dollar terms to $19.6bn.

And the company's European heartache did not end there; $200m in "pension-related pre-tax charges... resulting from a court ruling in Spain" contributed to a five per cent drop in net income from continuing operations which came in at $2.4bn. Despite the reverses, chief executive Ginni Rometty stated that Big Blue's first-quarter performance constituted "a strong start to the year".

"Our strategic-imperatives growth rate accelerated, demonstrating the power of our offerings in these new opportunities and contributing to improved revenue performance," she added. "Our focus on higher value through portfolio transformation and investment in key areas of the business drove continued margin expansion."