Instant view: BM's Q3 sales, signings lukewarm
International Business Machines Corp posted quarterly revenue and total services signings in line with or marginally weaker than Wall Street had expected.
Commentary:
BOB DJURDJEVIC, ANALYST, ANNEX RESEARCH
When you keep exceeding forecasts as many times as IBM, that increases expectations for greater and greater performance. Even when the company delivers performance as good as the third quarter that's not good enough.
The results were on target as far as my expectations are concerned. I expect the stock might take a hit. The company exceeded published expectations, but the underlying expectations were even higher.
It is as solid as a rock. IBM's strategic initiatives, including cloud computing, smart cities and emerging markets, are growing in significant double digits. In the long term, the company is on a strong and a solid footing. Eventually the markets will get it right.
The backlog was up by $2.4 billion at $137 billion. That's an indicator of stability in new business sales and includes the contracts that run out and don't renew.
Investors who have been very bullish on IBM are probably taking some profits now. That's why the stock is down on good results.
TRIP CHOWDHRY, ANALYST, GLOBAL EQUITIES RESEARCH
Whatever IBM could control, they did a great job. But they are not immune to macro conditions. Financial conditions are tough.
People don't want to cancel projects, but projects are getting delayed. Sales cycles are getting elongated. New projects are getting smaller budgets.
(Reporting by Alistair Barr in San Francisco and Jim Finkle in Boston)
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