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Dec 31, 2023
IBM Q4 2023 Earnings Report
IBM's Q4 2023 earnings were released with revenue growth across all segments, driven by hybrid cloud and AI adoption, alongside strong margin expansion and cash generation.
Key Takeaways
IBM reported a solid Q4 2023 with revenue up 4% to $17.4 billion. The company's growth was broad-based across all segments, driven by hybrid cloud and AI offerings. IBM exceeded its free cash flow objective for the year and expects revenue performance in line with its mid-single digit model and about $12 billion in free cash flow for 2024.
Revenue reached $17.4 billion, reflecting a 4% increase (3% at constant currency).
Software revenue increased by 3% (2% at constant currency).
Consulting revenue grew by 6% (5% at constant currency).
Infrastructure revenue was up by 3% (2% at constant currency).
Forward Guidance
IBM anticipates revenue growth in line with its mid-single digit model and approximately $12 billion in free cash flow for the full year 2024.
Positive Outlook
- Revenue growth consistent with mid-single digit model.
- Focus on hybrid cloud and AI offerings driving growth.
- Strong year-end cash position with $13.5 billion in cash and marketable securities.
- Return value to shareholders through dividends.
- Continued investment in R&D and talent.
Challenges Ahead
- Currency is expected to be about a one-point headwind to revenue growth
- Risk of downturn in economic environment and client spending budgets.
- Potential for failure of innovation initiatives.
- Damage to company's reputation could adversely affect results.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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