Worldwide Enterprise Machines Corp – Ultimate Outcomes
IBM RELEASES FOURTH-QUARTER RESULTS
Income Progress in All Key Segments; Expanded Margins; Strong Money Technology
ARMONK, N.Y., Jan. 25, 2023 — IBM (NYSE: IBM) immediately introduced fourth-quarter 2022 earnings outcomes.
Emblem – https://mma.prnewswire.com/media/95470/ibm_logo.jpg
“Our strong fourth-quarter efficiency capped a yr by which we grew income above our mid-single digit mannequin. Shoppers in all geographies more and more embraced our hybrid cloud and AI options as expertise stays a differentiating power in immediately’s enterprise setting,” mentioned Arvind Krishna, IBM chairman and chief govt officer. “Waiting for 2023, we anticipate full-year income development in keeping with our mid-single digit mannequin.”
Fourth-Quarter Highlights
- Income of $16.7 billion, flat, up 6 % at fixed foreign money
– Software program income up 3 %, up 8 % at fixed foreign money
– Consulting income up 0.5 %, up 9 % at fixed foreign money
– Infrastructure income up 2 %, up 7 % at fixed foreign money
Full-Yr Highlights
- Income of $60.5 billion, up 6 %, up 12 % at fixed foreign money (about 4 factors from gross sales to Kyndryl)
– Hybrid cloud income of $22.4 billion, up 11 %, up 17 % at fixed foreign money - On a consolidated foundation, web money from working actions of $10.4 billion; free money circulate of $9.3 billion
Full-Yr 2023 Expectations
- The corporate expects fixed foreign money income development in keeping with its mid-single digit mannequin and about $10.5 billion in consolidated free money circulate, up greater than $1 billion yr to yr
| FOURTH QUARTER 2022 INCOME STATEMENT SUMMARY | ||||||||||||||||||
| Pre-tax | Diluted | |||||||||||||||||
| Gross | Pre-tax | Revenue | Internet | Earnings | ||||||||||||||
| Income | Revenue | Revenue | Margin | Revenue | Per Share | |||||||||||||
| GAAP from Persevering with Operations |
$ | 16.7B | $ | 9.6B | $ | 3.3B | 19.8 | % | $ | 2.9B | $ | 3.13 | ||||||
| Yr/Yr | 0 | %* | 1 | % | 15 | % | 2.7 | Pts | 17 | % | 15 | % | ||||||
| Working (Non-GAAP) |
$ | 9.8B | $ | 3.8B | 22.9 | % | $ | 3.3B | $ | 3.60 | ||||||||
| Yr/Yr | 1 | % | 8 | % | 1.7 | Pts | 9 | % | 7 | % | ||||||||
| * 6% at fixed foreign money | ||||||||||||||||||
“IBM’s income development and working revenue in 2022 reveal the power and multiplier impact of our platform-centric method to hybrid cloud and AI,” mentioned James Kavanaugh, IBM senior vice chairman and chief monetary officer. “Our client-focused portfolio and powerful recurring income stream place IBM effectively for continued development, strong money technology and returning worth to shareholders by means of dividends.”
Phase Outcomes for Fourth Quarter
- Software program (contains Hybrid Platform & Options, Transaction Processing)— revenues of $7.3 billion, up 2.8 %, up 8.0 % at fixed foreign money:
– Hybrid Platform & Options up 5 %, up 10 % at fixed foreign money:
— Pink Hat up 10 %, up 15 % at fixed foreign money
— Automation up 4 %, up 9 % at fixed foreign money
— Knowledge & AI up 4 %, up 8 % at fixed foreign money
— Safety up 4 %, up 10 % at fixed foreign money
– Transaction Processing down 3 %, up 3 % at fixed foreign money - Consulting (contains Enterprise Transformation, Expertise Consulting and Software Operations)— revenues of $4.8 billion, up 0.5 %, up 9.3 % at fixed foreign money:
– Enterprise Transformation down 1 %, up 7 % at fixed foreign money
– Expertise Consulting up 1 %, up 10 % at fixed foreign money
– Software Operations up 2 %, up 12 % at fixed foreign money - Infrastructure (contains Hybrid Infrastructure, Infrastructure Assist)— revenues of $4.5 billion, up 1.6 %, up 7.4 % at fixed foreign money:
– Hybrid Infrastructure up 6 %, up 11 % at fixed foreign money:
— IBM z Methods up 16 %, up 21 % at fixed foreign money
— Distributed Infrastructure flat, up 5 % at fixed foreign money
– Infrastructure Assist down 8 %, flat at fixed foreign money - Financing (contains shopper and industrial financing)— revenues of $0.2 billion, down 0.4 %, up 3.9 % at fixed foreign money
Money Move and Stability Sheet
On a consolidated foundation, within the fourth quarter, the corporate generated web money from working actions of $4.0 billion, up $1.4 billion. Internet money from working actions excluding IBM Financing receivables was $5.8 billion, up $1.9 billion. IBM’s free money circulate was $5.2 billion, up $1.9 billion. The corporate returned $1.5 billion to shareholders in dividends within the fourth quarter.
On a consolidated foundation, for the total yr, the corporate generated web money from working actions of $10.4 billion, down $2.4 billion. Internet money from working actions excluding IBM Financing receivables was $11.2 billion, up $2.3 billion. IBM’s free money circulate was $9.3 billion, up $2.8 billion. IBM returned $5.9 billion to shareholders in dividends.
IBM ended the fourth quarter with $8.8 billion of money readily available (which incorporates marketable securities), up $1.3 billion from year-end 2021. Debt, together with IBM Financing debt of $12.9 billion, totaled $50.9 billion, down $0.8 billion because the finish of 2021.
Full-Yr 2022 Outcomes
| FULL-YEAR 2022 INCOME STATEMENT | ||||||||||||||||||
| GAAP outcomes embrace affect of one-time, non-cash pension settlement cost* | ||||||||||||||||||
| Pre-tax | ||||||||||||||||||
| Gross | Pre-tax | Revenue | Internet | Diluted | ||||||||||||||
| Income | Revenue | Revenue | Margin | Revenue | EPS | |||||||||||||
| GAAP from Persevering with Operations |
$ | 60.5B | $ | 32.7B | $ | 1.2B | * | 1.9 | %* | $ | 1.8B | * | $ | 1.95 | * | |||
| Yr/Yr | 6 | %** | 4 | % | (76) | %* | (6.5) | Pts* | (62) | %* | (63) | %* | ||||||
| Working (Non-GAAP) |
$ | 33.4B | $ | 9.8B | 16.2 | % | $ | 8.3B | $ | 9.13 | ||||||||
| Yr/Yr | 4 | % | 25 | % | 2.5 | Pts | 16 | % | 15 | % | ||||||||
| * GAAP outcomes embrace the affect of a one-time, non-cash pension settlement cost within the third quarter of $5.9 billion ($4.4 billion web of tax) associated to the switch of a portion of the corporate’s U.S. outlined profit pension obligations and associated plan belongings to 3rd occasion insurers. | ||||||||||||||||||
| ** 12% at fixed foreign money | ||||||||||||||||||
Full-Yr 2023 Expectations
- Income Progress: The corporate expects fixed foreign money income development in keeping with its mid-single digit mannequin. At present overseas change charges, foreign money is anticipated to be impartial to a one-point tailwind to income development.
- Free Money Move: The corporate expects about $10.5 billion in consolidated free money circulate, up greater than $1 billion yr to yr.
Ahead-Wanting and Cautionary Statements
Apart from the historic info and discussions contained herein, statements contained on this launch could represent forward-looking statements inside the that means of the Non-public Securities Litigation Reform Act of 1995. Ahead-looking statements are primarily based on the corporate’s present assumptions relating to future enterprise and monetary efficiency. These statements contain quite a lot of dangers, uncertainties and different elements that might trigger precise outcomes to vary materially, together with, however not restricted to, the next: a downturn in financial setting and shopper spending budgets; a failure of the corporate’s innovation initiatives; harm to the corporate’s fame; dangers from investing in development alternatives; failure of the corporate’s mental property portfolio to forestall aggressive choices and the failure of the corporate to acquire essential licenses; the corporate’s means to efficiently handle acquisitions, alliances and inclinations, together with integration challenges, failure to attain aims, the belief of liabilities and better debt ranges; fluctuations in monetary outcomes; affect of native authorized, financial, political, well being and different circumstances; the corporate’s failure to fulfill development and productiveness aims; ineffective inner controls; the corporate’s use of accounting estimates; impairment of the corporate’s goodwill or amortizable intangible belongings; the corporate’s means to draw and retain key staff and its reliance on essential expertise; impacts of relationships with essential suppliers; product high quality points; impacts of enterprise with authorities purchasers; reliance on third occasion distribution channels and ecosystems; cybersecurity and information privateness concerns; opposed results associated to local weather change and environmental issues; tax issues; authorized proceedings and investigatory dangers; the corporate’s pension plans; foreign money fluctuations and buyer financing dangers; affect of adjustments in market liquidity circumstances and buyer credit score danger on receivables; potential failure of the separation of Kyndryl Holdings, Inc. to qualify for tax-free remedy; danger elements associated to IBM securities; and different dangers, uncertainties and elements mentioned within the firm’s Kind 10-Qs, Kind 10-Okay and within the firm’s different filings with the U.S. Securities and Change Fee or in supplies integrated therein by reference. Any forward-looking assertion on this launch speaks solely as of the date on which it’s made. Besides as required by legislation, the corporate assumes no obligation to replace or revise any forward-looking statements.
Presentation of Data on this Press Launch
On November 3, 2021, IBM accomplished the separation of Kyndryl. Except in any other case specified, outcomes are introduced on a unbroken operations foundation. The reference in Full-Yr Highlights to the income impacts from gross sales to Kyndryl are incremental gross sales post-separation, yr thus far by means of October.
In an effort to supply traders with extra info relating to the corporate’s outcomes as decided by typically accepted accounting rules (GAAP), the corporate has additionally disclosed on this press launch the next non-GAAP info, which administration believes supplies helpful info to traders:
IBM outcomes —
- adjusting for foreign money (i.e., at fixed foreign money);
- presenting working (non-GAAP) earnings per share quantities and associated earnings assertion objects;
- consolidated free money circulate;
- consolidated money from working actions excluding IBM Financing receivables.
The rationale for administration’s use of those non-GAAP measures is included in Exhibit 99.2 within the Kind 8–Okay that features this press launch and is being submitted immediately to the SEC.
Convention Name and Webcast
IBM’s common quarterly earnings convention name is scheduled to start at 5:00 p.m. EST, immediately. The Webcast could also be accessed through a hyperlink at https://www.ibm.com/investor/occasions/earnings-4q22. Presentation charts shall be accessible shortly earlier than the Webcast.
Monetary Outcomes Under (sure quantities could not add due to make use of of rounded numbers; percentages introduced are calculated from the underlying whole-dollar quantities).
Contact: IBM
Sarah Meron, 347–891–1770
[email protected]
Tim Davidson, 914–844–7847
[email protected]
| INTERNATIONAL BUSINESS MACHINES CORPORATION COMPARATIVE FINANCIAL RESULTS (Unaudited; {Dollars} in thousands and thousands besides per share quantities) |
||||||||||||||||
| Three Months Ended | Yr Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021* | 2022** | 2021* | |||||||||||||
| REVENUE BY SEGMENT | ||||||||||||||||
| Software program | $ | 7,288 | $ | 7,087 | $ | 25,037 | $ | 23,426 | ||||||||
| Consulting | 4,770 | 4,746 | 19,107 | 17,844 | ||||||||||||
| Infrastructure | 4,483 | 4,414 | 15,288 | 14,188 | ||||||||||||
| Financing | 172 | 172 | 645 | 774 | ||||||||||||
| Different | (22) | 275 | 453 | 1,119 | ||||||||||||
| TOTAL REVENUE | 16,690 | 16,695 | 60,530 | 57,350 | ||||||||||||
| GROSS PROFIT | 9,632 | 9,500 | 32,687 | 31,486 | ||||||||||||
| GROSS PROFIT MARGIN | ||||||||||||||||
| Software program | 81.2 | % | 81.6 | % | 79.6 | % | 79.6 | % | ||||||||
| Consulting | 27.4 | % | 27.0 | % | 25.5 | % | 28.0 | % | ||||||||
| Infrastructure | 54.9 | % | 54.8 | % | 52.8 | % | 55.3 | % | ||||||||
| Financing | 47.1 | % | 32.5 | % | 38.3 | % | 31.7 | % | ||||||||
| TOTAL GROSS PROFIT MARGIN | 57.7 | % | 56.9 | % | 54.0 | % | 54.9 | % | ||||||||
| EXPENSE AND OTHER INCOME | ||||||||||||||||
| S,G&A | 4,765 | 4,903 | 18,609 | 18,745 | ||||||||||||
| R,D&E | 1,604 | 1,625 | 6,567 | 6,488 | ||||||||||||
| Mental property and customized improvement earnings | (245) | (181) | (663) | (612) | ||||||||||||
| Different (earnings) and expense | (118) | (18) | 5,803 | 873 | ||||||||||||
| Curiosity expense | 313 | 303 | 1,216 | 1,155 | ||||||||||||
| TOTAL EXPENSE AND OTHER INCOME | 6,320 | 6,632 | 31,531 | 26,649 | ||||||||||||
| INCOME FROM CONTINUING OPERATIONS | ||||||||||||||||
| BEFORE INCOME TAXES | 3,312 | 2,869 | 1,156 | 4,837 | ||||||||||||
| Pre-tax margin | 19.8 | % | 17.2 | % | 1.9 | % | 8.4 | % | ||||||||
| Provision for/(Profit from) earnings taxes | 443 | 407 | (626) | 124 | ||||||||||||
| Efficient tax fee | 13.4 | % | 14.2 | % | (54.2) | % | 2.6 | % | ||||||||
| INCOME FROM CONTINUING OPERATIONS | $ | 2,869 | $ | 2,462 | $ | 1,783 | $ | 4,712 | ||||||||
| DISCONTINUED OPERATIONS | ||||||||||||||||
| Revenue/(loss) from discontinued operations, web of taxes | (159) | (129) | (143) | 1,030 | ||||||||||||
| NET INCOME | $ | 2,711 | $ | 2,332 | $ | 1,639 | $ | 5,743 | ||||||||
| EARNINGS PER SHARE OF COMMON STOCK | ||||||||||||||||
| Assuming Dilution | ||||||||||||||||
| Persevering with Operations | $ | 3.13 | $ | 2.72 | $ | 1.95 | $ | 5.21 | ||||||||
| Discontinued Operations | $ | (0.17) | $ | (0.14) | $ | (0.16) | $ | 1.14 | ||||||||
| TOTAL | $ | 2.96 | $ | 2.57 | $ | 1.80 | $ | 6.35 | ||||||||
| Fundamental | ||||||||||||||||
| Persevering with Operations | $ | 3.17 | $ | 2.74 | $ | 1.97 | $ | 5.26 | ||||||||
| Discontinued Operations | $ | (0.18) | $ | (0.14) | $ | (0.16) | $ | 1.15 | ||||||||
| TOTAL | $ | 2.99 | $ | 2.60 | $ | 1.82 | $ | 6.41 | ||||||||
| WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING (M’s) | ||||||||||||||||
| Assuming Dilution | 915.9 | 906.6 | 912.3 | 904.6 | ||||||||||||
| Fundamental | 905.8 | 898.2 | 902.7 | 896.0 | ||||||||||||
| ____________________ | ||||||||||||||||
| * Recast to evolve with 2022 presentation. | ||||||||||||||||
| ** Features a one-time, non-cash pension settlement cost of $5.9 billion ($4.4 billion web of tax). | ||||||||||||||||
| INTERNATIONAL BUSINESS MACHINES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) |
||||||
| At | At | |||||
| December 31, | December 31, | |||||
| ({Dollars} in Hundreds of thousands) | 2022 | 2021 | ||||
| ASSETS: | ||||||
| Present Property: | ||||||
| Money and money equivalents | $ | 7,886 | $ | 6,650 | ||
| Restricted money | 103 | 307 | ||||
| Marketable securities | 852 | 600 | ||||
| Notes and accounts receivable – commerce, web | 6,541 | 6,754 | ||||
| Quick-term financing receivables, web | 7,790 | 8,014 | ||||
| Different accounts receivable, web | 817 | 1,002 | ||||
| Inventories | 1,552 | 1,649 | ||||
| Deferred prices | 967 | 1,097 | ||||
| Pay as you go bills and different present belongings | 2,611 | 3,466 | ||||
| Complete Present Property | 29,118 | 29,539 | ||||
| Property, plant and gear, web | 5,334 | 5,694 | ||||
| Working right-of-use belongings, web | 2,878 | 3,222 | ||||
| Lengthy-term financing receivables, web | 5,806 | 5,425 | ||||
| Pay as you go pension belongings | 8,236 | 9,850 | ||||
| Deferred prices | 866 | 924 | ||||
| Deferred taxes | 6,256 | 7,370 | ||||
| Goodwill | 55,949 | 55,643 | ||||
| Intangibles, web | 11,184 | 12,511 | ||||
| Investments and varied belongings | 1,617 | 1,823 | ||||
| Complete Property | $ | 127,243 | $ | 132,001 | ||
| LIABILITIES: | ||||||
| Present Liabilities: | ||||||
| Taxes | $ | 2,196 | $ | 2,289 | ||
| Quick-term debt | 4,760 | 6,787 | ||||
| Accounts payable | 4,051 | 3,955 | ||||
| Deferred earnings | 12,032 | 12,518 | ||||
| Working lease liabilities | 874 | 974 | ||||
| Different liabilities | 7,592 | 7,097 | ||||
| Complete Present Liabilities | 31,505 | 33,619 | ||||
| Lengthy-term debt | 46,189 | 44,917 | ||||
| Retirement associated obligations | 9,596 | 14,435 | ||||
| Deferred earnings | 3,499 | 3,577 | ||||
| Working lease liabilities | 2,190 | 2,462 | ||||
| Different liabilities | 12,243 | 13,996 | ||||
| Complete Liabilities | 105,222 | 113,005 | ||||
| EQUITY: | ||||||
| IBM Stockholders’ Fairness: | ||||||
| Widespread inventory | 58,343 | 57,319 | ||||
| Retained earnings | 149,825 | 154,209 | ||||
| Treasury inventory — at value | (169,484) | (169,392) | ||||
| Collected different complete earnings/(loss) | (16,740) | (23,234) | ||||
| Complete IBM Stockholders’ Fairness | 21,944 | 18,901 | ||||
| Noncontrolling pursuits | 77 | 95 | ||||
| Complete Fairness | 22,021 | 18,996 | ||||
| Complete Liabilities and Fairness | $ | 127,243 | $ | 132,001 | ||
| INTERNATIONAL BUSINESS MACHINES CORPORATION CASH FLOW ANALYSIS (Unaudited) |
||||||||||||
| Three Months Ended | Yr Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| ({Dollars} in Hundreds of thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||
| Consolidated Internet Money from Operations per GAAP | $ | 3,965 | $ | 2,543 | $ | 10,435 | $ | 12,796 | ||||
| Much less: change in IBM Financing receivables | (1,788) | (1,328) | (717) | 3,907 | ||||||||
| Capital Expenditures, web | (544) | (526) | (1,860) | (2,381) | ||||||||
| Consolidated Free Money Move | 5,209 | 3,345 | 9,291 | 6,508 | ||||||||
| Acquisitions | (1,329) | (275) | (2,348) | (3,293) | ||||||||
| Divestitures | 1 | 88 | 1,272 | 114 | ||||||||
| Dividends | (1,494) | (1,474) | (5,948) | (5,869) | ||||||||
| Non-Financing Debt | (2,777) | (20) | 1,909 | (1,191) | ||||||||
| Different (contains IBM Financing web receivables and debt) | (498) | (2,514) | (2,893) | (2,987) | ||||||||
| Change in Money, Money Equivalents, Restricted Money and Quick-term Marketable Securities* |
$ | (888) | $ | (850) | $ | 1,283 | $ | (6,718) | ||||
| ____________________ | ||||||||||||
| * Money flows are introduced on a consolidated foundation. | ||||||||||||
| INTERNATIONAL BUSINESS MACHINES CORPORATION CASH FLOW (Unaudited) |
||||||||||||
| Three Months Ended | Yr Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| ({Dollars} in Hundreds of thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||
| Internet Revenue from Operations | $ | 2,711 | $ | 2,332 | $ | 1,639 | $ | 5,743 | ||||
| Pension Settlement Cost | – | – | 5,894 | – | ||||||||
| Depreciation/Amortization of Intangibles | 1,137 | 1,380 | 4,802 | 6,416 | ||||||||
| Inventory-based Compensation | 248 | 264 | 987 | 982 | ||||||||
| Working Capital / Different | 1,657 | (105) | (2,170) | (4,253) | ||||||||
| IBM Financing A/R | (1,788) | (1,328) | (717) | 3,907 | ||||||||
| Internet Money Offered by Working Actions | $ | 3,965 | $ | 2,543 | $ | 10,435 | $ | 12,796 | ||||
| Capital Expenditures, web of funds & proceeds | (544) | (526) | (1,860) | (2,381) | ||||||||
| Divestitures, web of money transferred | 1 | 88 | 1,272 | 114 | ||||||||
| Acquisitions, web of money acquired | (1,329) | (275) | (2,348) | (3,293) | ||||||||
| Marketable Securities / Different Investments, web | 553 | 38 | (1,265) | (414) | ||||||||
| Internet Money Offered by/(Utilized in) Investing Actions | $ | (1,318) | $ | (675) | $ | (4,202) | $ | (5,975) | ||||
| Debt, web of funds & proceeds | (1,350) | (2,030) | 1,221 | (8,116) | ||||||||
| Dividends | (1,494) | (1,474) | (5,948) | (5,869) | ||||||||
| Financing – Different | (8) | 811 | (231) | 630 | ||||||||
| Internet Money Offered by/(Utilized in) Financing Actions | $ | (2,852) | $ | (2,692) | $ | (4,958) | $ | (13,354) | ||||
| Impact of Change Price adjustments on Money | 219 | (26) | (244) | (185) | ||||||||
| Internet Change in Money, Money Equivalents and Restricted Money* | $ | 13 | $ | (850) | $ | 1,032 | $ | (6,718) | ||||
| ____________________ | ||||||||||||
| * Money flows are introduced on a consolidated foundation. | ||||||||||||
| INTERNATIONAL BUSINESS MACHINES CORPORATION SEGMENT DATA (Unaudited) |
|||||||||||||
| Three Months Ended December 31, 2022 | |||||||||||||
| ({Dollars} in Hundreds of thousands) | Software program | Consulting | Infrastructure | Financing | |||||||||
| Income | $ | 7,288 | $ | 4,770 | $ | 4,483 | $ | 172 | |||||
| Pre-tax Revenue from Persevering with Operations | $ | 2,347 | $ | 523 | $ | 1,026 | $ | 75 | |||||
| Pre-tax Margin | 32.2 | % | 11.0 | % | 22.9 | % | 43.6 | % | |||||
| Change YTY Income | 2.8 | % | 0.5 | % | 1.6 | % | (0.4) | % | |||||
| Change YTY Income – fixed foreign money | 8.0 | % | 9.3 | % | 7.4 | % | 3.9 | % | |||||
| Three Months Ended December 31, 2021 | |||||||||||||
| ({Dollars} in Hundreds of thousands) | Software program * | Consulting | Infrastructure | Financing | |||||||||
| Income | $ | 7,087 | $ | 4,746 | $ | 4,414 | $ | 172 | |||||
| Pre-tax Revenue from Persevering with Operations | $ | 2,142 | $ | 436 | $ | 1,036 | $ | 79 | |||||
| Pre-tax Margin | 30.2 | % | 9.2 | % | 23.5 | % | 46.0 | % | |||||
| ____________________ | |||||||||||||
| * Recast to evolve with 2022 presentation. | |||||||||||||
| Yr Ended December 31, 2022 | |||||||||||||
| ({Dollars} in Hundreds of thousands) | Software program | Consulting | Infrastructure | Financing | |||||||||
| Income | $ | 25,037 | $ | 19,107 | $ | 15,288 | $ | 645 | |||||
| Pre-tax Revenue from Persevering with Operations | $ | 6,162 | $ | 1,677 | $ | 2,262 | $ | 340 | |||||
| Pre-tax Margin | 24.6 | % | 8.8 | % | 14.8 | % | 52.6 | % | |||||
| Change YTY Income | 6.9 | % | 7.1 | % | 7.8 | % | (16.6) | % | |||||
| Change YTY Income – fixed foreign money | 11.9 | % | 14.9 | % | 13.5 | % | (13.0) | % | |||||
| Yr Ended December 31, 2021 | |||||||||||||
| ({Dollars} in Hundreds of thousands) | Software program * | Consulting | Infrastructure | Financing | |||||||||
| Income | $ | 23,426 | $ | 17,844 | $ | 14,188 | $ | 774 | |||||
| Pre-tax Revenue from Persevering with Operations | $ | 4,849 | $ | 1,449 | $ | 2,025 | $ | 441 | |||||
| Pre-tax Margin | 20.7 | % | 8.1 | % | 14.3 | % | 57.0 | % | |||||
| ____________________ | |||||||||||||
| * Recast to evolve with 2022 presentation. | |||||||||||||
| INTERNATIONAL BUSINESS MACHINES CORPORATION U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION (Unaudited; {Dollars} in thousands and thousands besides per share quantities) |
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| Three Months Ended December 31, 2022 | |||||||||||||||||||
| Persevering with Operations | |||||||||||||||||||
| Acquisition- | Retirement- | Tax | Kyndryl- | ||||||||||||||||
| Associated | Associated | Reform | Associated | Working | |||||||||||||||
| GAAP | Changes (1) | Changes (2) | Impacts | Impacts (3) | (Non-GAAP) | ||||||||||||||
| Gross Revenue | $ | 9,632 | $ | 156 | $ | — | $ | — | $ | — | $ | 9,788 | |||||||
| Gross Revenue Margin | 57.7 | % | 0.9 | pts. | — | pts. | — | pts. | — | pts. | 58.6 | % | |||||||
| S,G&A | $ | 4,765 | $ | (262) | $ | — | $ | — | $ | (0) | $ | 4,503 | |||||||
| Different (Revenue) & Expense | (118) | (1) | (93) | — | 2 | (210) | |||||||||||||
| Complete Expense & Different (Revenue) | 6,320 | (263) | (93) | — | 2 | 5,965 | |||||||||||||
| Pre-tax Revenue from Persevering with Operations |
3,312 | 419 | 93 | — | (2) | 3,823 | |||||||||||||
| Pre-tax Revenue Margin from Persevering with Operations |
19.8 | % | 2.5 | pts. | 0.6 | pts. | — | pts. | (0.0) | pts. | 22.9 | % | |||||||
| Provision for/(Profit from) Revenue Taxes (4) |
$ | 443 | $ | 109 | $ | 16 | $ | (42) | $ | — | $ | 526 | |||||||
| Efficient Tax Price | 13.4 | % | 1.4 | pts. | 0.1 | pts. | (1.1) | pts. | 0.0 | pts. | 13.8 | % | |||||||
| Revenue from Persevering with Operations | $ | 2,869 | $ | 310 | $ | 77 | $ | 42 | $ | (2) | $ | 3,296 | |||||||
| Revenue Margin from Persevering with Operations |
17.2 | % | 1.9 | pts. | 0.5 | pts. | 0.3 | pts. | (0.0) | pts. | 19.8 | % | |||||||
| Diluted Earnings Per Share:Persevering with Operations |
$ | 3.13 | $ | 0.34 | $ | 0.08 | $ | 0.05 | $ | (0.00) | $ | 3.60 | |||||||
| Three Months Ended December 31, 2021 | |||||||||||||||||||
| Persevering with Operations | |||||||||||||||||||
| Acquisition- | Retirement- | Tax | Kyndryl- | ||||||||||||||||
| Associated | Associated | Reform | Associated | Working | |||||||||||||||
| GAAP | Changes (1) | Changes (2) | Impacts | Impacts (3) | (Non-GAAP) | ||||||||||||||
| Gross Revenue | $ | 9,500 | $ | 182 | $ | — | $ | — | $ | — | $ | 9,682 | |||||||
| Gross Revenue Margin | 56.9 | % | 1.1 | pts. | — | pts. | — | pts. | — | pts. | 58.0 | % | |||||||
| S,G&A | $ | 4,903 | $ | (290) | $ | — | $ | — | $ | (8) | $ | 4,605 | |||||||
| Different (Revenue) & Expense | (18) | (1) | (315) | — | 126 | (208) | |||||||||||||
| Complete Expense & Different (Revenue) | 6,632 | (290) | (315) | — | 118 | 6,145 | |||||||||||||
| Pre-tax Revenue from Persevering with Operations |
2,869 | 472 | 315 | — | (118) | 3,537 | |||||||||||||
| Pre-tax Revenue Margin from Persevering with Operations |
17.2 | % | 2.8 | pts. | 1.9 | pts. | — | pts. | (0.7) | pts. | 21.2 | % | |||||||
| Provision for/(Profit from) Revenue Taxes (4) |
$ | 407 | $ | 117 | $ | 109 | $ | (94) | $ | (37) | $ | 502 | |||||||
| Efficient Tax Price | 14.2 | % | 1.4 | pts. | 1.8 | pts. | (2.7) | pts. | (0.6) | pts. | 14.2 | % | |||||||
| Revenue from Persevering with Operations | $ | 2,462 | $ | 355 | $ | 206 | $ | 94 | $ | (81) | $ | 3,035 | |||||||
| Revenue Margin from Persevering with Operations |
14.7 | % | 2.1 | pts. | 1.2 | pts. | 0.6 | pts. | (0.5) | pts. | 18.2 | % | |||||||
| Diluted Earnings Per Share: Persevering with Operations |
$ | 2.72 | $ | 0.39 | $ | 0.23 | $ | 0.10 | $ | (0.09) | $ | 3.35 | |||||||
| ____________________ | |||||||||||||||||||
| (1) | Contains amortization of bought intangible belongings, in course of R&D, transaction prices, relevant restructuring and associated bills, tax costs associated to acquisition integration and pre-closing costs, equivalent to financing prices. |
||||||||||||||||||
| (2) | Contains amortization of prior service prices, curiosity value, anticipated return on plan belongings, amortized actuarial features/losses, the impacts of any plan curtailments/settlements and pension insolvency prices and different prices. |
||||||||||||||||||
| (3) | Primarily pertains to the realized achieve/(loss) and unrealized truthful worth adjustments in Kyndryl frequent inventory and the associated 2022 cash-settled swap. | ||||||||||||||||||
| (4) | Tax affect on working (non-GAAP) pre-tax earnings from persevering with operations is calculated beneath the identical accounting rules utilized to the As Reported pre-tax earnings beneath ASC 740, which employs an annual efficient tax fee technique to the outcomes. |
||||||||||||||||||
| INTERNATIONAL BUSINESS MACHINES CORPORATION U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION (Unaudited; {Dollars} in thousands and thousands besides per share quantities) |
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| Yr Ended December 31, 2022 | ||||||||||||||||||||
| Persevering with Operations | ||||||||||||||||||||
| Acquisition- | Retirement- | Tax | Kyndryl- | |||||||||||||||||
| Associated | Associated | Reform | Associated | Working | ||||||||||||||||
| GAAP | Changes (1) | Changes* (2) | Impacts | Impacts (3) | (Non-GAAP) | |||||||||||||||
| Gross Revenue | $ | 32,687 | $ | 682 | $ | — | $ | — | $ | — | $ | 33,370 | ||||||||
| Gross Revenue Margin | 54.0 | % | 1.1 | pts. | — | pts. | — | pts. | — | pts. | 55.1 | % | ||||||||
| S,G&A | $ | 18,609 | $ | (1,080) | $ | — | $ | — | $ | (0) | $ | 17,529 | ||||||||
| Different (Revenue) & Expense | 5,803 | (3) | (6,548) | — | (351) | (1,099) | ||||||||||||||
| Complete Expense & Different (Revenue) | 31,531 | (1,083) | (6,548) | — | (351) | 23,549 | ||||||||||||||
| Pre-tax Revenue from Persevering with Operations |
1,156 | 1,765 | 6,548 | — | 351 | 9,821 | ||||||||||||||
| Pre-tax Revenue Margin from Persevering with Operations |
1.9 | % | 2.9 | pts. | 10.8 | pts. | — | pts. | 0.6 | pts. | 16.2 | % | ||||||||
| Provision for/(Profit from) Revenue Taxes (4) |
$ | (626) | $ | 436 | $ | 1,615 | $ | 70 | $ | — | $ | 1,495 | ||||||||
| Efficient Tax Price | (54.2) | % | 14.2 | pts. | 52.6 | pts. | 0.7 | pts. | 1.9 | pts. | 15.2 | % | ||||||||
| Revenue from Persevering with Operations | $ | 1,783 | $ | 1,329 | $ | 4,933 | $ | (70) | $ | 351 | $ | 8,326 | ||||||||
| Revenue Margin from Persevering with Operations |
2.9 | % | 2.2 | pts. | 8.1 | pts. | (0.1) | pts. | 0.6 | pts. | 13.8 | % | ||||||||
| Diluted Earnings Per Share: Persevering with Operations |
$ | 1.95 | $ | 1.46 | $ | 5.41 | $ | (0.08) | $ | 0.38 | $ | 9.13 | ||||||||
| ____________________ | ||||||||||||||||||||
| * Features a one-time, non-cash, pre-tax pension settlement cost of $5.9 billion ($4.4 billion web of tax). | ||||||||||||||||||||
| Yr Ended December 31, 2021 | ||||||||||||||||||||
| Persevering with Operations | ||||||||||||||||||||
| Acquisition- | Retirement- | Tax | Kyndryl- | |||||||||||||||||
| Associated | Associated | Reform | Associated | Working | ||||||||||||||||
| GAAP | Changes (1) | Changes (2) | Impacts | Impacts (3) | (Non-GAAP) | |||||||||||||||
| Gross Revenue | $ | 31,486 | $ | 719 | $ | — | $ | — | $ | — | $ | 32,205 | ||||||||
| Gross Revenue Margin | 54.9 | % | 1.3 | pts. | — | pts. | — | pts. | — | pts. | 56.2 | % | ||||||||
| S,G&A | $ | 18,745 | $ | (1,160) | $ | — | $ | — | $ | (8) | $ | 17,577 | ||||||||
| Different (Revenue) & Expense | 873 | (2) | (1,282) | — | 126 | (285) | ||||||||||||||
| Complete Expense & Different (Revenue) | 26,649 | (1,162) | (1,282) | — | 118 | 24,324 | ||||||||||||||
| Pre-tax Revenue from Persevering with Operations |
4,837 | 1,881 | 1,282 | — | (118) | 7,881 | ||||||||||||||
| Pre-tax Revenue Margin from Persevering with Operations |
8.4 | % | 3.3 | pts. | 2.2 | pts. | — | pts. | (0.2) | pts. | 13.7 | % | ||||||||
| Provision for/(Profit from) Revenue Taxes (4) |
$ | 124 | $ | 457 | $ | 251 | $ | (89) | $ | (37) | $ | 706 | ||||||||
| Efficient Tax Price | 2.6 | % | 5.2 | pts. | 2.8 | pts. | (1.1) | pts. | (0.4) | pts. | 9.0 | % | ||||||||
| Revenue from Persevering with Operations | $ | 4,712 | $ | 1,424 | $ | 1,031 | $ | 89 | $ | (81) | $ | 7,174 | ||||||||
| Revenue Margin from Persevering with Operations |
8.2 | % | 2.5 | pts. | 1.8 | pts. | 0.2 | pts. | (0.1) | pts. | 12.5 | % | ||||||||
| Diluted Earnings Per Share: Persevering with Operations |
$ | 5.21 | $ | 1.57 | $ | 1.14 | $ | 0.10 | $ | (0.09) | $ | 7.93 | ||||||||
| ____________________ | ||||||||||||||||||||
| (1) | Contains amortization of bought intangible belongings, in course of R&D, transaction prices, relevant restructuring and associated bills, tax costs associated to acquisition integration and pre-closing costs, equivalent to financing prices. |
|||||||||||||||||||
| (2) | Contains amortization of prior service prices, curiosity value, anticipated return on plan belongings, amortized actuarial features/losses, the impacts of any plan curtailments/settlements and pension insolvency prices and different prices. |
|||||||||||||||||||
| (3) | Primarily pertains to the realized achieve/(loss) and unrealized truthful worth adjustments in Kyndryl frequent inventory and the associated 2022 cash-settled swap. | |||||||||||||||||||
| (4) | Tax affect on working (non-GAAP) pre-tax earnings from persevering with operations is calculated beneath the identical accounting rules utilized to the As Reported pre-tax earnings beneath ASC 740, which employs an annual efficient tax fee technique to the outcomes. |
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SOURCE IBM
PRNewswire 2023
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