IBM ends revenue decline, says it has strengthened cloud and blockchain leadership

IBM has finally stopped its revenue slide after more than five and a half years – with the company saying it has strengthened its position as the leading enterprise cloud and blockchain leader.

The Armonk giant posted revenues of $22.5 billion (£16.2bn) for the fourth quarter of 2017, up 3.5% on this time last year, where revenues were at $21.7bn. Of this figure, 40% was comprised of the technology services and cloud platforms bucket, at $9.2bn, while 24% came from cognitive solutions and 18% was derived from global business services.

In prepared remarks, Martin Schroeter, senior vice president for IBM global markets, told analysts that cloud revenue was up 27%, with revenue for the year totalling $17 billion, up from $7bn three years ago. “We play an important role in running our clients’ most critical processes,” said Schroeter, as transcribed by Seeking Alpha. “And now with the IBM Cloud, which is built for the enterprise, each of the 10 largest global banks, nine of the top 10 retailers and eight of the top 10 airlines are cloud-as-a-service clients.

“We also continue to make progress in emerging areas like blockchain,” added Schroeter. “Remember that for us, blockchain is a set of technologies that allow our clients to simplify complex, end-to-end processes in a way that couldn’t have been done before. It requires the attributes of immutability, permissioning and scalability, and we’re already performing thousands of transactions per second.”

“Our strategic imperatives revenue again grew at a double-digit rate and now represents 46% of our total revenue, and we are pleased with our overall revenue growth in the quarter,” said IBM chief executive Ginni Rometty in a statement. “During 2017, we strengthened our position as the leading enterprise cloud provider and established IBM as the blockchain leader for business. Looking ahead, we are uniquely positioned to help clients use data and AI to build smarter businesses.”

Among the quarter’s highlights for IBM were the launch of IBM Cloud Private and, on the branding side, removing reference to Bluemix and moving it forward as IBM Cloud. Cloud Private aims to ‘extend cloud-native tools across public and private clouds’ and is compatible with a range of systems manufacturers, such as Cisco, Dell EMC and Lenovo.

IBM has also announced it is extending its partnership with Salesforce, with the latter naming IBM a preferred cloud services provider and the former naming Salesforce as a preferred customer engagement platform for sales and service. The two companies already have a complementary relationship; Salesforce CEO Marc Benioff took to the stage at IBM’s InterConnect event back in March to discuss with Rometty the rise of artificial intelligence.

You can read the full IBM financial results and statement here (pdf).