IBM (IBM) reported third-quarter results after the market close Monday that were in line with the preliminary results it reported earlier this month, when it also revealed plans to spin off a big chunk of the company as part of an ongoing restructuring. IBM stock dipped.
The company reported adjusted earnings of $2.58 per share. Revenue fell 2.6% from the year-ago period to $17.6 million. Total cloud revenue climbed 19% to $6 billion.
IBM stock dipped 0.8%, near 124.50, during after-hours trading on the stock market today.
IBM on Oct. 8 revealed plans to spin off a $19 billion technology consulting business so it can focus more intently on cloud computing and artificial intelligence.
The business unit will be spun off into a new public company. It helps companies manage their technology infrastructure. IBM sees it as a tax-free deal completed by the end of next year.
On the day of the announcement, IBM stock surged 6%, closing at 131.49.
Downward Pressure On IBM Stock
The announcement comes as IBM has undergone a long and massive restructuring, which has put downward pressure on IBM stock for years.
“We have the necessary financial flexibility to increase our investments in hybrid cloud and AI technology innovation and skills, while remaining committed to our long-standing dividend policy,” said James Kavanaugh, IBM chief financial officer, in written statements with the earnings release.
IBM ended the third quarter with $15.8 billion of cash on hand, which includes marketable securities.
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