IBM beats Q3 estimates on software strength and lifts cash flow outlook
IBM delivered third-quarter revenue of $17.1 billion and adjusted earnings per share of $2.95, beating analyst estimates and prompting the company to raise its full-year cash flow projections.
IBM posted third-quarter revenue of $17.1 billion, representing a 5% increase year over year and topping consensus projections of roughly $16.82 billion, according to reports from The Wall Street Journal and market data trackers. Adjusted earnings per share reached $2.95, an 11% increase from the prior year and ahead of the $2.86 expected by analysts. Net income for the period rose 26% to $2.19 billion, up from $1.74 billion a year earlier.[1][3][5][6][7][8][9]
Software revenue drove much of the performance, rising 8% year over year to $7.8 billion to beat the $7.64 billion estimate. Infrastructure revenue expanded 4% to $3.7 billion, aided by a 31% rise in distributed infrastructure. Bloomberg reported that IBM recovered most of the infrastructure deals that had faced delays earlier in the year. While IBM Z mainframe sales fell 20%, the decline moderated substantially compared to a 42% plunge recorded in the prior quarter.[1][3][4][5][6][9]
For the full year, IBM maintained its constant-currency revenue growth target of 4% to 5% and raised its cash outlook, now projecting free cash flow to increase by more than $1 billion year over year. Chief Executive Officer Arvind Krishna highlighted customer traction around artificial intelligence, noting that clients are deploying Super Intelligence to reshape core operating models. Following the release, IBM shares climbed more than 5% in extended trading.[2][3][5][7][8]
Key facts
- IBM's Q3 revenue rose 5% year over year to $17.1 billion, beating analyst consensus estimates of roughly $16.82 billion.
- Adjusted earnings per share came in at $2.95, an 11% year-over-year increase that topped the $2.86 analyst projection.
- Net income jumped 26% year over year to $2.19 billion from $1.74 billion.
- Software segment revenue increased 8% to $7.80 billion, surpassing Wall Street expectations of $7.64 billion.
- IBM said it recovered most of the infrastructure contracts that had been delayed earlier in the year.
- Mainframe sales dropped 20%, an improvement from the 42% decline recorded in the second quarter.
- IBM reaffirmed full-year constant-currency revenue growth guidance of 4% to 5% and now expects free cash flow to expand by more than $1 billion year over year.
Sources · 9 sources
- TE
TechmemeArticle ·
IBM reports Q3 revenue up 5% YoY to $17.1B, above $16.82B est., net income up 26% to $2.19B, software revenue up 8% to $7.8B, and infrastructure revenue up 4% (Elias Schisgall/Wall Street Journal) Elias Schisgall / Wall Street Journal : IBM reports Q3 revenue up 5% YoY to $17.1B, above $16.82B est., net income up 26% to $2.19B, software revenue up 8% to $7.8B, and infrastructure revenue up 4% — The company reported a third-quarter profit of $2.19 billion, up from $1.74 billion a year earlier
Open source - CN
CNBC@CNBCPost on X ·
IBM beats on top and bottom lines as CEO Krishna touts 'Super Intelligence' traction https://t.co/zYIvszmABd
Open source - WS
Wall St Engine@wallstenginePost on X ·
$IBM Q3’26 EARNINGS HIGHLIGHTS 🔹 Revenue: $17.1B (Est. $16.82B) 🟢; +5% YoY 🔹 Adj. EPS: $2.95 (Est. $2.86) 🟢; +11% YoY 🔹 Free Cash Flow: $3.0B FY26 Guide: 🔹 Constant Currency Revenue Growth: 4%-5% 🔹 Free Cash Flow: ~$1B increase YoY Segment Revenue: 🔹 Software: $7.8B; +8% YoY, +9% cc 🔹 Consulting: $5.3B; flat, +2% cc 🔹 Infrastructure: $3.7B; +4% YoY, +5% cc Other Q3 Metrics: 🔹 Constant Currency Revenue Growth: 6% 🔹 Hybrid Cloud (Red Hat): +11% YoY 🔹 Automation: -3% YoY 🔹 Data: +19% YoY, +20% cc 🔹 IBM Z: -20% YoY, -19% cc 🔹 Distributed Infrastructure: +31% YoY, +32% cc Financials: 🔹 Adj. Gross Margin: 58.5%; -0.2 pts YoY 🔹 Adj. Net Income: $2.8B; +12% YoY 🔹 Operating Cash Flow: $4.0B 🔹 Cash & Marketable Securities: $11.1B 🔹 Debt: $63.8B Comments: 🔸 “Our clients are now deploying Super Intelligence in ways that transform entire operating models, instead of simply addressing narrow or novel problems.” 🔸 “For the full year, we continue to expect constant currency revenue growth in the range of four-to-five percent, and we now expect free cash flow to increase by more than $1 billion year-over-year.”
Open source - BL
Bloomberg@businessPost on X ·
IBM reported sales that topped analysts’ estimates, saying it had recovered most of the infrastructure deals that were delayed earlier this year. https://t.co/DnjNEQckcO
Open source - BT
Bull Theory@BullTheoryioPost on X ·
BREAKING: $IBM jumps almost 10% after hours after beating earnings expectations in Q3. Earnings per share came in at $2.95, above the $2.86 expected. Software revenue grew 8% to $7.80 billion, above the $7.64 billion expected. IBM's weakest business is stabilizing. Mainframe sales fell 20%, an improvement from a 42% drop last quarter. IBM also raised its full year cash flow outlook.
Open source - TE
Techmeme@TechmemePost on X ·
IBM reports Q3 revenue up 5% YoY to $17.1B, above $16.82B est., net income up 26% to $2.19B, software revenue up 8% to $7.8B, and infrastructure revenue up 4% (@eschisgall / Wall Street Journal) (Visit Techmeme dot com for the link and full context!)
Open source - TR
TrendSpider@TrendSpiderPost on X ·
$IBM EARNINGS DOUBLE BEAT ✅ Q3 Adj. EPS: $2.95 vs $2.86 est ✅ Q3 Sales: $17.103B vs $16.882B est ✅ https://t.co/okrZOZpcXS
Open source - CB
Coin Bureau@coinbureauPost on X ·
BREAKING: $IBM jumps over 5% after hours as IBM beats estimates and raises its cash outlook. Revenue hit $17.1 BILLION vs $16.83 BILLION expected, up 5% from a year ago. Adjusted EPS came in at $2.95 vs $2.86 expected. IBM now expects free cash flow to grow by more than $1 BILLION this year.
Open source - GU
GURGAVIN@gurgavinPost on X ·
IBM JUST REPORTED EARNINGS *IBM SOFTWARE REVENUE $7.80B, ESTIMATE $7.64B ( BEAT ✅ ) *IBM OPERATING EPS $2.95, ESTIMATE $2.86 ( BEAT ✅ ) $IBM https://t.co/wrT9tzQd63
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