IBM revenues beats estimates

IBM reported fourth-quarter earnings and revenue that beat Wall Street expectations on Thursday, thanks largely to the company’s transition towards higher-margin and faster-growing businesses like the cloud and Big Data analytics. But the iconic New York–based enterprise technology company has now suffered 19 straight quarters of declining year-over-year total revenues, a streak that has kept would-be investors on the sidelines.

While earnings per share rose 4% from a year ago, revenues were down 1%, the company said. IBM's revenue has decline from the year-ago quarter since April 2012, when sales were nearly flat.

"In 2016, our strategic imperatives grew to represent more than 40 percent of our total revenue and we have established ourselves as the industry's leading cognitive solutions and cloud platform company," Ginni Rometty, IBM chairman, president and chief executive officer, said in a statement. 

The company said its annual exit run rate for cloud as-a-service revenue grew 62% to $8.6 billion, from 5.3 billion in the same period a year ago. And the fact that these new segments now account for more than 40% of IBM's overall revenue suggests IBM’s streak of quarterly revenue declines may soon end.

IBM still remains profitable, reporting quarterly earnings of $4.5 billion, up slightly from the same quarter a year earlier. On an annual basis, IBM's profits fell 10% year-over-year to $11.9 billion in 2016.

In terms of guidance for fiscal 2017, the company expect adjusted earnings of at least $13.80 per share on revenue $78.75 billion. IBM shares have risen 30% over the past year, compared with a 16% rise in the S&P 500 Index.