Technology

IBM RELEASES THIRD-QUARTER RESULTS

Published

3 months ago

October 23, 2024

Accelerated Software revenue growth, expanded gross profit margin, and strong free cash flow

ARMONK, N.Y., Oct. 23, 2024 /PRNewswire/ — IBM (NYSE: IBM) today announced third-quarter 2024 earnings results.

“Our third-quarter performance was led by double-digit growth in Software, including a re-acceleration in Red Hat. We continue to see great momentum in AI as our models are trusted, fit-for-purpose, and lower cost, with performance leadership. Our generative AI book of business now stands at more than $3 billion, up more than $1 billion quarter to quarter,” said Arvind Krishna, IBM chairman, president and chief executive officer. “Heading into the final quarter of 2024, we expect fourth-quarter constant currency revenue growth to be consistent with the third quarter, with continued strength in Software. We are confident in our ability to deliver more than $12 billion in free cash flow for the year, driven by continued expansion of our operating margins.”

Third-Quarter Highlights

Revenue
– Revenue of $15.0 billion, up 1 percent, up 2 percent at constant currency
– Software revenue up 10 percent
– Consulting revenue flat
– Infrastructure revenue down 7 percent
Profit
– Gross Profit Margin: GAAP: 56.3 percent, up 190 basis points; Operating (Non-GAAP):
57.5 percent, up 210 basis points
Cash Flow
– Year to date, net cash from operating activities of $9.1 billion; free cash flow of $6.6 billion

THIRD-QUARTER 2024 INCOME STATEMENT SUMMARY

GAAP results include impact of one-time, non-cash pension settlement charge (1)

Revenue

Gross

Profit

Gross

Profit

Margin

Pre-tax

Income/

(Loss) (1)

Pre-tax

Income

Margin (1)

Net

Income/

(Loss) (1)

Diluted

Earnings/

(Loss) Per

Share (1)

GAAP from

Continuing

Operations

$ 15.0 B

$ 8.4 B

56.3

$ (0.8) B

(5.4)

$ (0.3) B

$ (0.34)

Year/Year

%(2)

1.9

Pts

-18.1

Pts

Operating

(Non-GAAP)

$ 8.6 B

57.5

$ 2.5 B

16.6

$ 2.2 B

$ 2.30

Year/Year

2.1

Pts

1.0

Pts

(1) 2024 GAAP results include the impact of a one-time, non-cash, pension settlement charge of $2.7 billion ($2.0 billion net of tax) related

to the transfer of a portion of the company’s U.S. defined benefit pension obligations and related plan assets to a third-party insurer,

announced in September 2024.

(2) 2% at constant currency.

“Our investments are paying off in Software as we’ve repositioned our portfolio in recent years. In the third quarter, Software delivered broad-based growth and now represents nearly 45 percent of our total revenue. Our ongoing focus on product mix, coupled with our productivity initiatives enables us to continue to drive operating leverage in our underlying profit performance,” said James Kavanaugh, IBM senior vice president and chief financial officer. “With our strong cash generation, we are well-positioned to continue investing for growth while returning value to shareholders through dividends.”

Segment Results for Third Quarter

Software — revenues of $6.5 billion, up 9.7 percent, up 9.6 percent at constant currency:
– Hybrid Platform & Solutions up 10 percent
— Red Hat up 14 percent
— Automation up 13 percent
— Data & AI up 5 percent
— Security down 1 percent
– Transaction Processing up 9 percent

Consulting — revenues of $5.2 billion, down 0.5 percent, down 0.2 percent at constant currency:
– Business Transformation up 2 percent
– Technology Consulting down 4 percent
– Application Operations down 1 percent

Infrastructure — revenues of $3.0 billion, down 7.0 percent, down 6.7 percent at constant currency:
– Hybrid Infrastructure down 9 percent
— IBM Z down 19 percent
— Distributed Infrastructure down 3 percent
– Infrastructure Support down 4 percent, down 3 percent at constant currency

Financing — revenues of $0.2 billion, down 2.5 percent, down 1.3 percent at constant currency

Cash Flow and Balance Sheet

In the third quarter, the company generated net cash from operating activities of $2.9 billion, down $0.2 billion year to year. IBM’s free cash flow was $2.1 billion, up $0.4 billion year to year. The company returned $1.5 billion to shareholders in dividends in the third quarter.

For the first nine months of the year, the company generated net cash from operating activities of $9.1 billion, down $0.4 billion year to year. IBM’s free cash flow was $6.6 billion, up $1.5 billion year to year.

IBM ended the third quarter with $13.7 billion of cash, restricted cash and marketable securities, up $0.3 billion from year-end 2023. Debt, including IBM Financing debt of $10.4 billion, totaled $56.6 billion, flat year to date.

Expectations

Revenue: The company expects fourth-quarter constant currency revenue growth consistent with the third quarter. At current foreign exchange rates, currency is expected to be about a half-point headwind to revenue growth in the quarter
Free cash flow: The company continues to expect more than $12 billion in free cash flow for the full year

Forward-Looking and Cautionary Statements

Except for the historical information and discussions contained herein, statements contained in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the company’s current assumptions regarding future business and financial performance. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including, but not limited to, the following: a downturn in economic environment and client spending budgets; a failure of the company’s innovation initiatives; damage to the company’s reputation; risks from investing in growth opportunities; failure of the company’s intellectual property portfolio to prevent competitive offerings and the failure of the company to obtain necessary licenses; the company’s ability to successfully manage acquisitions, alliances and dispositions, including integration challenges, failure to achieve objectives, the assumption of liabilities and higher debt levels; fluctuations in financial results; impact of local legal, economic, political, health and other conditions; the company’s failure to meet growth and productivity objectives; ineffective internal controls; the company’s use of accounting estimates; impairment of the company’s goodwill or amortizable intangible assets; the company’s ability to attract and retain key employees and its reliance on critical skills; impacts of relationships with critical suppliers; product quality issues; impacts of business with government clients; reliance on third party distribution channels and ecosystems; cybersecurity and data privacy considerations; adverse effects related to climate change and environmental matters; tax matters; legal proceedings and investigatory risks; the company’s pension plans; currency fluctuations and customer financing risks; impact of changes in market liquidity conditions and customer credit risk on receivables; potential failure of the separation of Kyndryl Holdings, Inc. to qualify for tax-free treatment; risk factors related to IBM securities; and other risks, uncertainties and factors discussed in the company’s Form 10-Qs, Form 10-K and in the company’s other filings with the U.S. Securities and Exchange Commission or in materials incorporated therein by reference.

Statements in this communication regarding the strategic acquisition that are forward-looking may include projections as to closing date for the transaction, the extent of, and the time necessary to obtain, the regulatory approvals required for the transaction, the anticipated benefits of the transaction, the impact of the transaction on IBM’s business, the synergies from the transaction, and the combined company’s future operating results.

Any forward-looking statement in this release speaks only as of the date on which it is made. Except as required by law, the company assumes no obligation to update or revise any forward-looking statements.

Presentation of Information in this Press Release

For generative AI, book of business includes Software transactional revenue, SaaS Annual Contract Value and Consulting signings. The generative AI book of business is further defined within Exhibit 99.2 in the Form 8-K that includes this press release.

In an effort to provide investors with additional information regarding the company’s results as determined by generally accepted accounting principles (GAAP), the company has also disclosed in this press release the following non-GAAP information, which management believes provides useful information to investors:

IBM results —

adjusting for currency (i.e., at constant currency);
presenting operating (non-GAAP) earnings per share amounts and related income statement items;
free cash flow;
adjusted EBITDA.

The rationale for management’s use of these non-GAAP measures is included in Exhibit 99.2 in the Form 8-K that includes this press release and is being submitted today to the SEC.

Conference Call and Webcast

IBM’s regular quarterly earnings conference call is scheduled to begin at 5:00 p.m. ET, today. The Webcast may be accessed via a link at https://www.ibm.com/investor/events/earnings-3q24. Presentation charts will be available shortly before the Webcast.

Financial Results Below (certain amounts may not add due to use of rounded numbers; percentages presented are calculated from the underlying whole-dollar amounts).

Contact: IBM
Sarah Meron, 347-891-1770
sarah.meron@ibm.com

Tim Davidson, 914-844-7847
tfdavids@us.ibm.com

INTERNATIONAL BUSINESS MACHINES CORPORATION

COMPARATIVE FINANCIAL RESULTS

(Unaudited; Dollars in millions except per share amounts)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2024

2023 (1)

2024

2023 (1)

REVENUE BY SEGMENT

Software

$ 6,524

$ 5,947

$ 19,162

$ 17,832

Consulting

5,152

5,178

15,517

15,601

Infrastructure

3,042

3,272

9,764

9,988

Financing

181

186

543

566

Other

170

214

491

TOTAL REVENUE

14,968

14,752

45,199

44,479

GROSS PROFIT

8,420

8,023

25,112

24,033

GROSS PROFIT MARGIN

Software

83.2

82.3

83.1

82.3

Consulting

28.4

27.6

26.7

26.3

Infrastructure

55.0

53.7

55.3

54.0

Financing

47.2

49.7

48.2

47.5

TOTAL GROSS PROFIT MARGIN

56.3

54.4

55.6

54.0

EXPENSE AND OTHER INCOME

S,G&A

4,911

4,458

14,823

14,212

R,D&E

1,876

1,685

5,512

5,027

Intellectual property and custom development income

(238)

(190)

(696)

(618)

Other (income) and expense

2,244

(215)

1,694

(721)

Interest expense

429

412

1,288

1,202

TOTAL EXPENSE AND OTHER INCOME

9,222

6,150

22,621

19,102

INCOME/(LOSS) FROM CONTINUING OPERATIONS

BEFORE INCOME TAXES

(802)

1,873

2,491

4,931

Pre-tax margin

(5.4)

12.7

5.5

11.1

Provision for/(Benefit from) income taxes

(485)

159

(597)

702

Effective tax rate

60.4

8.5

(24.0)

14.2

INCOME/(LOSS) FROM CONTINUING OPERATIONS

$ (317)

$ 1,714

$ 3,088

$ 4,229

DISCONTINUED OPERATIONS

Income/ (loss) from discontinued operations, net of taxes

(13)

(10)

(15)

NET INCOME/(LOSS) (2)

$ (330)

$ 1,704

$ 3,109

$ 4,214

EARNINGS/(LOSS) PER SHARE OF COMMON STOCK (2)

Assuming Dilution

Continuing Operations

$ (0.34)

$ 1.86

$ 3.30

$ 4.59

Discontinued Operations

$ (0.01)

$ 0.02

$ (0.02)

TOTAL

$ (0.36)

$ 1.84

$ 3.32

$ 4.58

Basic

Continuing Operations

$ (0.34)

$ 1.88

$ 3.36

$ 4.65

Discontinued Operations

$ (0.01)

$ 0.02

$ (0.02)

TOTAL

$ (0.36)

$ 1.87

$ 3.38

$ 4.63

WEIGHTED-AVERAGE NUMBER OF COMMON SHARES

OUTSTANDING (M’s)

Assuming Dilution

923.6

923.7

935.4

920.3

Basic

923.6

912.8

920.3

910.1

____________________

(1) Recast to reflect January 2024 segment changes.

(2) 2024 includes the impact of a one-time, non-cash, pension settlement charge of $2.7 billion ($2.0 billion net of tax).

INTERNATIONAL BUSINESS MACHINES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEET

(Unaudited)

(Dollars in Millions)

September 30,
2024

December 31,
2023

ASSETS:

Current Assets:

Cash and cash equivalents

$ 13,197

$ 13,068

Restricted cash

Marketable securities

505

373

Notes and accounts receivable – trade, net

5,390

7,214

Short-term financing receivables, net

5,765

6,793

Other accounts receivable, net

928

640

Inventories

1,367

1,161

Deferred costs

966

998

Prepaid expenses and other current assets

2,408

2,639

Total Current Assets

30,543

32,908

Property, plant and equipment, net

5,614

5,501

Operating right-of-use assets, net

3,355

3,220

Long-term financing receivables, net

4,931

5,766

Prepaid pension assets

7,975

7,506

Deferred costs

788

842

Deferred taxes

6,943

6,656

Goodwill

61,092

60,178

Intangibles, net

11,090

11,036

Investments and sundry assets

2,009

1,626

Total Assets

$ 134,339

$ 135,241

LIABILITIES:

Current Liabilities:

Taxes

$ 1,584

$ 2,270

Short-term debt

3,599

6,426

Accounts payable

3,274

4,132

Deferred income

12,882

13,451

Operating lease liabilities

790

820

Other liabilities

6,725

7,022

Total Current Liabilities

28,853

34,122

Long-term debt

52,980

50,121

Retirement-related obligations

10,366

10,808

Deferred income

3,666

3,533

Operating lease liabilities

2,757

2,568

Other liabilities

11,186

11,475

Total Liabilities

109,809

112,628

EQUITY:

IBM Stockholders’ Equity:

Common stock

61,013

59,643

Retained earnings

149,789

151,276

Treasury stock – at cost

(169,935)

(169,624)

Accumulated other comprehensive income/(loss)

(16,418)

(18,761)

Total IBM Stockholders’ Equity

24,448

22,533

Noncontrolling interests

Total Equity

24,530

22,613

Total Liabilities and Equity

$ 134,339

$ 135,241

INTERNATIONAL BUSINESS MACHINES CORPORATION

CASH FLOW ANALYSIS

(Unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

(Dollars in Millions)

2024

2023

2024

2023

Net Cash from Operations per GAAP

$ 2,881

$ 3,055

$ 9,115

$ 9,468

Less: change in IBM Financing receivables

873

1,092

1,824

3,119

Capital Expenditures, net

(282)

(705)

(1,226)

Free Cash Flow

2,064

1,682

6,586

5,123

Acquisitions

(2,513)

(4,589)

(2,748)

(4,945)

Divestitures

(10)

705

(4)

Dividends

(1,542)

(1,515)

(4,601)

(4,522)

Non-Financing Debt

(383)

(942)

693

7,572

Other (includes IBM Financing net receivables and debt)

131

(379)

(1,068)

Change in Cash, Cash Equivalents, Restricted Cash and Short-term

Marketable Securities

$ (2,241)

$ (5,333)

$ 257

$ 2,156

INTERNATIONAL BUSINESS MACHINES CORPORATION

CASH FLOW

(Unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

(Dollars in Millions)

2024

2023

2024

2023

Net Income/(loss) from Operations

$ (330)

$ 1,704

$ 3,109

$ 4,214

Pension Settlement Charge

2,725

–

2,725

–

Depreciation/Amortization of Intangibles (1)

1,268

1,093

3,555

3,243

Stock-based Compensation

330

286

966

843

Operating assets and liabilities/Other, net (2)

(1,984)

(1,119)

(3,063)

(1,952)

IBM Financing A/R

873

1,092

1,824

3,119

Net Cash Provided by Operating Activities

$ 2,881

$ 3,055

$ 9,115

$ 9,468

Capital Expenditures, net of payments & proceeds (3)

(282)

(705)

(1,226)

Divestitures, net of cash transferred

(10)

705

(4)

Acquisitions, net of cash acquired

(2,513)

(4,589)

(2,748)

(4,945)

Marketable Securities / Other Investments, net

869

2,927

(810)

(3,732)

Net Cash Provided by/(Used in) Investing Activities

$ (1,587)

$ (1,953)

$ (3,558)

$ (9,906)

Debt, net of payments & proceeds

(1,259)

(1,550)

(777)

4,619

Dividends

(1,542)

(1,515)

(4,601)

(4,522)

Financing – Other

(67)

(26)

(252)

Net Cash Provided by/(Used in) Financing Activities

$ (2,766)

$ (3,132)

$ (5,403)

$ (154)

Effect of Exchange Rate changes on Cash

207

(119)

(29)

(120)

Net Change in Cash, Cash Equivalents and Restricted Cash

$ (1,264)

$ (2,149)

$ 125

$ (713)

____________________

(1) Includes operating lease right-of-use assets amortization.

(2) Includes a $0.7 billion tax effect associated with the one-time, non-cash pension settlement charge in the third-quarter 2024.

(3) 2024 includes proceeds of $0.4 billion from the sale of certain QRadar SaaS assets.

INTERNATIONAL BUSINESS MACHINES CORPORATION

GAAP NET INCOME TO ADJUSTED EBITDA RECONCILIATION

(Unaudited)

Three Months Ended

September 30,

Nine Months Ended

September 30,

(Dollars in Billions)

2024

2023

Yr/Yr

2024

2023

Yr/Yr

Net Income/(Loss) as reported (GAAP) (1)

$ (0.3)

$ 1.7

$ (2.0)

$ 3.1

$ 4.2

$ (1.1)

Less: Income/(loss) from discontinued operations, net of tax

0.0

Income/(Loss) from continuing operations

(0.3)

1.7

(2.0)

3.1

4.2

(1.1)

Provision for/(Benefit from) income taxes from continuing ops.

(0.5)

0.2

(0.6)

0.7

(1.3)

Pre-tax income/(loss) from continuing operations (GAAP)

(0.8)

1.9

(2.7)

2.5

4.9

(2.4)

Non-operating adjustments (before tax)

Acquisition-related charges (2)

0.5

0.4

0.1

1.5

1.2

0.2

Non-operating retirement-related costs/(income) (1)

2.8

0.0

2.8

3.0

0.0

3.0

Operating (non-GAAP) pre-tax income/(loss) from continuing ops.

2.5

2.3

0.2

6.9

6.1

0.8

Net interest expense

0.3

0.0

0.7

0.0

Depreciation/Amortization of non-acquired intangible assets

0.7

0.0

2.1

2.0

0.1

Stock-based compensation

0.3

0.0

1.0

0.8

0.1

Workforce rebalancing charges

0.3

0.0

0.3

0.7

0.4

0.3

Corporate (gains) and charges (3)

(0.4)

0.0

(0.3)

(0.6)

0.0

(0.6)

Adjusted EBITDA

$ 3.8

$ 3.5

$ 0.2

$ 10.8

$ 10.1

$ 0.8

____________________

(1) 2024 includes the impact of a one-time, non-cash pension settlement charge of $2.7 billion ($2.0 billion net of tax).

(2) Primarily consists of amortization of acquired intangible assets.

(3) Corporate (gains) and charges primarily consists of unique corporate actions such as gains on divestitures and asset sales (e.g., certain QRadar SaaS assets).

INTERNATIONAL BUSINESS MACHINES CORPORATION

SEGMENT DATA

(Unaudited)

Three Months Ended September 30, 2024

(Dollars in Millions)

Software

Consulting

Infrastructure

Financing

Revenue

$ 6,524

$ 5,152

$ 3,042

$ 181

Segment Profit

$ 1,969

$ 559

$ 422

$ 86

Segment Profit Margin

30.2

10.9

13.9

47.5

Change YTY Revenue

9.7

(0.5)

(7.0)

(2.5)

Change YTY Revenue – Constant Currency

9.6

(0.2)

(6.7)

(1.3)

Three Months Ended September 30, 2023 (1)

(Dollars in Millions)

Software

Consulting

Infrastructure

Financing

Revenue

$ 5,947

$ 5,178

$ 3,272

$ 186

Segment Profit

$ 1,722

$ 566

$ 490

$ 91

Segment Profit Margin

29.0

10.9

15.0

49.2

__________________

(1) Recast to reflect January 2024 segment changes.

Nine Months Ended September 30, 2024

(Dollars in Millions)

Software

Consulting

Infrastructure

Financing

Revenue

$ 19,162

$ 15,517

$ 9,764

$ 543

Segment Profit

$ 5,582

$ 1,447

$ 1,387

$ 254

Segment Profit Margin

29.1

9.3

14.2

46.9

Change YTY Revenue

7.5

(0.5)

(2.3)

(4.1)

Change YTY Revenue – Constant Currency

8.0

1.1

(1.2)

(3.1)

Nine Months Ended September 30, 2023 (1)

(Dollars in Millions)

Software

Consulting

Infrastructure

Financing

Revenue

$ 17,832

$ 15,601

$ 9,988

$ 566

Segment Profit

$ 4,850

$ 1,476

$ 1,529

$ 256

Segment Profit Margin

27.2

9.5

15.3

45.2

____________________

(1) Recast to reflect January 2024 segment changes.

INTERNATIONAL BUSINESS MACHINES CORPORATION

U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION

(Unaudited; Dollars in millions except per share amounts)

Three Months Ended September 30, 2024

Continuing Operations

GAAP

Acquisition-

Adjustments (1)

Retirement-

Adjustments (2)

Tax

Reform

Impacts

Operating

(Non-GAAP)

Gross Profit

$ 8,420

$ 192

$ —

$ 8,612

Gross Profit Margin

56.3

1.3

pts

—

pts

—

pts

57.5

S,G&A

$ 4,911

$ (300)

$ —

$ 4,611

Other (Income) & Expense

2,244

—

(2,797)

—

(553)

Total Expense & Other (Income)

9,222

(300)

(2,797)

—

6,125

Pre-tax Income/(Loss) from Continuing Operations

(802)

492

2,797

—

2,487

Pre-tax Income Margin from Continuing Operations

(5.4)

3.3

pts

18.7

pts

—

pts

16.6

Provision for/(Benefit from) Income Taxes (3)

$ (485)

$ 119

$ 700

$ (2)

$ 332

Effective Tax Rate

60.4

(7.2)

pts

(39.8)

pts

(0.1)

pts

13.4

Income/(Loss) from Continuing Operations

$ (317)

$ 373

$ 2,097

$ 2

$ 2,155

Income Margin from Continuing Operations

(2.1)

2.5

pts

14.0

pts

0.0

pts

14.4

Diluted Earnings/(Loss) Per Share: Continuing

Operations (4)

$ (0.34)

$ 0.40

$ 2.27

$ 0.00

$ 2.30

Three Months Ended September 30, 2023

Continuing Operations

GAAP

Acquisition-

Adjustments (1)

Retirement-

Adjustments (2)

Tax

Reform

Impacts

Operating

(Non-GAAP)

Gross Profit

$ 8,023

$ 162

$ —

$ 8,185

Gross Profit Margin

54.4

1.1

pts

—

pts

—

pts

55.5

S,G&A

$ 4,458

$ (277)

$ —

$ 4,181

Other (Income) & Expense

(215)

—

(203)

Total Expense & Other (Income)

6,150

(277)

—

5,885

Pre-tax Income/(Loss) from Continuing Operations

1,873

438

(12)

—

2,299

Pre-tax Income Margin from Continuing Operations

12.7

3.0

pts

(0.1)

pts

—

pts

15.6

Provision for/(Benefit from) Income Taxes (3)

$ 159

$ 99

$ (14)

$ 24

$ 268

Effective Tax Rate

8.5

2.7

pts

(0.5)

pts

1.0

pts

11.7

Income/(Loss) from Continuing Operations

$ 1,714

$ 340

$ 1

$ (24)

$ 2,031

Income Margin from Continuing Operations

11.6

2.3

pts

0.0

pts

(0.2)

pts

13.8

Diluted Earnings/(Loss) Per Share: Continuing

Operations

$ 1.86

$ 0.37

$ 0.00

$ (0.03)

$ 2.20

____________________

(2) Includes amortization of prior service costs, interest cost, expected return on plan assets, amortized actuarial gains/losses, the impacts of any plan curtailments/settlements and pension insolvency costs and other costs. 2024 also includes the impact of a one-time, non-cash, pre-tax pension settlement charge of $2.7 billion ($2.0 billion net of tax).

(3) Tax impact on operating (non-GAAP) pre-tax income from continuing operations is calculated under the same accounting principles applied to the As Reported pre-tax income under ASC 740, which employs an annual effective tax rate method to the results.

(4) Operating (non-GAAP) earnings per share was calculated using 938.4 million shares, which includes 14.9 million dilutive potential shares under our stock-based compensation plans and contingently issuable shares. Due to the GAAP net loss for the three months ended September 30, 2024, these dilutive potential shares were excluded from the GAAP loss per share calculation as the effect would have been antidilutive. The difference in share count resulted in an additional $(0.04) reconciling item.

INTERNATIONAL BUSINESS MACHINES CORPORATION

U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION

(Unaudited; Dollars in millions except per share amounts)

Nine Months Ended September 30, 2024

Continuing Operations

GAAP

Acquisition-

Adjustments (1)

Retirement-

Adjustments (2)

Tax

Reform

Impacts (3)

Operating

(Non-GAAP)

Gross Profit

$ 25,112

$ 533

$ —

$ 25,645

Gross Profit Margin

55.6

1.2

pts

—

pts

—

pts

56.7

S,G&A

$ 14,823

$ (854)

$ —

$ 13,969

Other (Income) & Expense

1,694

(68)

(2,991)

—

(1,364)

Total Expense & Other (Income)

22,621

(922)

(2,991)

—

18,709

Pre-tax Income/(Loss) from Continuing Operations

2,491

1,454

2,991

—

6,936

Pre-tax Income Margin from Continuing Operations

5.5

3.2

pts

6.6

pts

—

pts

15.3

Provision for/(Benefit from) Income Taxes (4)

$ (597)

$ 374

$ 731

$ 434

$ 942

Effective Tax Rate

(24.0)

10.4

pts

20.9

pts

6.3

pts

13.6

Income/(Loss) from Continuing Operations

$ 3,088

$ 1,081

$ 2,259

$ (434)

$ 5,994

Income Margin from Continuing Operations

6.8

2.4

pts

5.0

pts

(1.0)

pts

13.3

Diluted Earnings/(Loss) Per Share: Continuing

Operations

$ 3.30

$ 1.16

$ 2.42

$ (0.46)

$ 6.41

Nine Months Ended September 30, 2023

Continuing Operations

GAAP

Acquisition-

Adjustments (1)

Retirement-

Adjustments (2)

Tax

Reform

Impacts

Operating

(Non-GAAP)

Gross Profit

$ 24,033

$ 460

$ —

$ 24,492

Gross Profit Margin

54.0

1.0

pts

—

pts

—

pts

55.1

S,G&A

$ 14,212

$ (768)

$ —

$ 13,444

Other (Income) & Expense

(721)

(2)

—

(707)

Total Expense & Other (Income)

19,102

(770)

—

18,348

Pre-tax Income from Continuing Operations

4,931

1,229

(16)

—

6,144

Pre-tax Income Margin from Continuing

Operations

11.1

2.8

pts

0.0

pts

—

pts

13.8

Provision for/(Benefit from) Income Taxes (4)

$ 702

$ 277

$ (27)

$ (91)

$ 861

Effective Tax Rate

14.2

1.7

pts

(0.4)

pts

(1.5)

pts

14.0

Income from Continuing Operations

$ 4,229

$ 953

$ 11

$ 91

$ 5,283

Income Margin from Continuing Operations

9.5

2.1

pts

0.0

pts

0.2

pts

11.9

Diluted Earnings Per Share: Continuing

Operations

$ 4.59

$ 1.04

$ 0.01

$ 0.10

$ 5.74

____________________

(1) Includes amortization of purchased intangible assets, in process R&D, transaction costs, applicable restructuring and related expenses, tax charges related to acquisition integration and pre-closing charges, such as financing costs. 2024 also includes a loss of $68 million on foreign exchange derivative contracts entered into by the company prior to the acquisition of StreamSets and webMethods from Software AG.

(3) 2024 includes a net benefit from discrete tax events.

(4) Tax impact on operating (non-GAAP) pre-tax income from continuing operations is calculated under the same accounting principles applied to the As Reported pre-tax income under ASC 740, which employs an annual effective tax rate method to the results.

INTERNATIONAL BUSINESS MACHINES CORPORATION

GAAP OPERATING CASH FLOW TO ADJUSTED EBITDA RECONCILIATION

(Unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

(Dollars in Billions)

2024

2023

2024

2023

Net Cash Provided by Operating Activities

$ 2.9

$ 3.1

$ 9.1

$ 9.5

Add:

Net interest expense

0.3

0.7

Provision for/(Benefit from) income taxes from continuing operations

(0.5)

0.2

(0.6)

0.7

Less change in:

Financing receivables

0.9

1.1

1.8

3.1

Other assets and liabilities/other, net (1)

(2.0)

(1.2)

(3.5)

(2.3)

Adjusted EBITDA

$ 3.8

$ 3.5

$ 10.8

$ 10.1

____________________

(1) Other assets and liabilities/other, net mainly consists of operating assets and liabilities/Other, net in the Cash Flow chart, workforce

rebalancing charges, non-operating impacts and corporate (gains) and charges.

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SOURCE IBM

Technology

Equipboard Unveils Sleek Redesign to Enhance Music Gear Discovery for Musicians Worldwide

Published

1 hour ago

January 11, 2025

Redesign Introduces Modern Features, Streamlined Navigation, and Richer Content to Inspire and Support Music Makers Globally

AUSTIN, Texas, Jan. 11, 2025 /PRNewswire-PRWeb/ — Equipboard, the leading online community for musicians and gear enthusiasts, announces the launch of its newly redesigned website. With a modern look, streamlined navigation, and powerful new features, the redesign sets a new standard for connecting artists, producers, and hobbyists with the tools they need to create music.

Since its inception in 2013, Equipboard has grown into the world’s largest database of music gear used by professionals and amateurs alike. The redesign reflects the platform’s commitment to fostering creativity, offering transparent information, and making gear discovery and purchasing easier and more enjoyable for its global user base.

What’s New?

Equipboard’s redesign is more than just a fresh coat of paint. It introduces a host of improvements aimed at elevating the way users explore, share, and connect over their favorite gear:

Modernized Design: A sleek, responsive layout ensures a seamless experience across all devices, with improved readability and accessibility. Enhanced Navigation: Faster, more intuitive browsing helps users discover gear, artists, and inspiration effortlessly. Whether searching for a guitarist’s pedalboard or a producer’s go-to synth, the information is now at their fingertips. Richer Content: Equipboard now features in-depth guides, expert-curated collections, and a revamped artist gear section to inspire and inform users at all levels of their musical journey. Personalized Experience: Registered users can now enjoy a more tailored interface, saving their favorite gear and creating wishlists for their next creative adventure. Price Comparisons Across Leading Retailers: Equipboard helps musicians make informed decisions by comparing prices on music gear from top retailers, ensuring they get the best value for their investment. Community-Focused Features: New tools make it easier for users to contribute to Equipboard’s ever-growing database, ensuring the platform remains the most trusted source for music gear information.

“Equipboard has always been about empowering musicians by connecting them with the tools and insights they need,” said Michael Pierce, Co-Founder. “This redesign reflects our commitment to innovation and community, creating an experience that’s as inspiring as the gear our users discover. From in-depth artist insights to real-time price comparisons, we’re excited to see how these improvements help musicians worldwide make better gear choices and create amazing music.”

About Equipboard

Equipboard is the ultimate online resource for musicians and gear enthusiasts. With a mission to provide transparent, community-driven information about the gear used by artists and professionals, Equipboard has become a trusted destination for millions of music creators. The platform also simplifies the buying process with its innovative price comparison tool, helping users find the best deals from leading retailers. From electric guitars to studio monitors, Equipboard’s extensive database helps users make informed decisions about their music-making journey.

The redesigned Equipboard is now live at https://equipboard.com, offering a fresh look and enhanced tools to support music creators in exploring the gear behind their favorite artists’ sound.

Media Contact

Michael Pierce, Equipboard, 888-888-8888, contact@equipboard.com, https://equipboard.com/

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SOURCE Equipboard

Technology

CES 2025: The Global Stage for Innovation, Connecting the World, Creating the Future

Published

6 hours ago

January 11, 2025

Where Technology Meets Humanity to Create Extraordinary Possibilities

LAS VEGAS, Jan. 10, 2025 /PRNewswire/ — CES® 2025, the most powerful tech event in the world, welcomed over 141,000 attendees from around the globe. With more than 4500 exhibitors, including 1400 startups, and more than 6000 media attendees, CES highlights the innovation and technology trends addressing global challenges and shaping the future.

“CES is where innovation comes to life,” said Gary Shapiro, CEO and Vice Chair, Consumer Technology Association (CTA)®, owner and producer of CES. “From the largest companies to trailblazing startups, the entire tech ecosystem is at the show. CES is the stage for groundbreaking product launches, transformative partnerships, and serendipitous business moments that define the future of technology.”

CES 2025 by the Numbers*

4500+ exhibitors, including 1400 startups141,000+ attendees, of which 40% were international from over 150 countries, regions, and territories6000+ global media, content creators, and industry analystsOver 60% of Fortune 500 companies300+ conference sessions with 1200+ speakers27,000+ news stories and content

*pre-audit figures

“From groundbreaking innovations that improve lives to transformative ideas that redefine industries, CES is a celebration of the art of the possible, showcasing how technology enriches our world and inspires a brighter future for all,” said Kinsey Fabrizio, President, CTA. “The evolution of CES has surged at this year’s show, where creativity, connectivity, and innovation inspire with visionary keynotes, thought-provoking conference sessions, and mind-blowing exhibits.”

As one of the most transparent trade shows, CES adheres to rigorous auditing standards established by UFI, The Global Association of the Exhibition Industry. To maintain the integrity of its reports, CES engages independent auditors, fostering trust among stakeholders.

“CES reaffirms its status as the largest audited annual business event,” said Fabrizio. “We look forward to releasing third-party confirmation in the spring, because at CTA we believe auditing is not just a nice-to-have, but the gold standard for global business events.”

Catch all the highlights and announcements from CES 2025 – including all conference programming—via CES YouTube and the CES Tech Talk Podcast. Watch the CES 2025 State of the Industry Address here.

CES 2025 Highlights

Artificial Intelligence – CES 2025 connected the dots between humanity and AI through powerful exhibits and programming. From AI-driven productivity tools to breakthroughs in medical advancements, products and services on the show floor demonstrated that artificial intelligence is not just a technology trend but a transformative force improving lives worldwide.
Exhibitors included: AMD, Hisense, LG, NVIDIA, Qualcomm, Samsung, Siemens, TCL

Digital Health – This year, CES 2025 saw tremendous energy at the Venetian where attendees witnessed the category’s seamless alignment with the smart living experience. CES has cemented itself as a premier convenor for the healthcare industry, bringing together trailblazers to explore biotechnology, telehealth, and wellness advancements that enhance patient care and longevity. Attendees celebrated the vibrant and dynamic environment that underscored how technology is transforming everyday life, particularly in health and wellness.
Exhibitors & Sponsors included: AARP, Abbott, Eyebot, FlowBeams, Lumia Health, OnMed, Panasonic, ResMed, Withings

Energy Transition – With the growth of high-power demand technologies like AI, cloud, and other data center innovations, the energy transition to zero carbon sources was a significant focus at CES 2025. Experimental energy solutions including battery and energy storage technologies, emerging energy sources like green hydrogen, and small modular nuclear reactors were highlights on the show floor.
Exhibitors included: Eaton, Jackery, Otrera, SK, Sony Honda Mobility

Mobility – Mobility innovation spanned construction, agriculture, marine tech, and advanced air travel. At CES 2025, self-driving and electric technologies enhanced planes and boats, and EV market growth brought new models from global OEMs to the show. Automation in construction and industry enhanced safety and addressed workforce gaps in labor-intensive roles.
Exhibitors included: Aptera Motors, BMW, Bosch, Brunswick, Caterpillar, Daedong, Garmin, Honda, Invo Station, John Deere, Kubota, Mobileye, Oshkosh, Scout Motors, Sumitomo Rubber, Scout Motors, Suzuki, Waymo, Xpeng AeroHT, Zeekr

Quantum – CES 2025 featured the latest innovations in quantum technologies, offering a glimpse into the future. Quantum technology uses properties of quantum mechanics to enable three distinct disciplines: improved networking, computing, and sensing. Innovations at the show demonstrated how quantum computing, working alongside AI, will allow for breakthroughs in research and computing for finance, chemistry, materials, logistics, and more.
Exhibitors included: Integrated Quantum Photonic, IonQ, QSIMPLUS, Quandela, SK

Sustainability – Sustainability is a crucial trend shaping technology innovation, especially in the context of energy transition. CES featured key advancements including new battery technologies, alternative material development like graphene, and off-grid renewable energy solutions. The show also put a spotlight on innovations such as synthetic microbes, bioplastics, and self-healing concrete that will contribute to sustainable construction.
Exhibitors included: Hydrific, Lyten, Melliens, Panasonic

Startups – Eureka Park was completely full, with 1400 startups from 39 countries including country pavilions representing Africa, European Union (EU), France, Italy, Israel, Japan, Korea, Netherlands, Switzerland, and Ukraine. Eureka Park is where innovators, investors, and the media meet to highlight and get hands-on with the technologies that will shape our collective future in core areas including accessibility, AI, digital health, and sustainability.

Keynotes

NVIDIA
NVIDIA founder and CEO Jensen Huang on Monday drew 6300 attendees to unveil the GeForce RTX 50, surpassing the RTX 4090 in performance, and introduced Agentic AI, a real-time assistant to streamline consumer workflows. Huang also showcased the Cosmos World Foundation Model and generative AI tools to advance robotics navigation. Highlighting AI-driven innovation, Huang announced a partnership with Toyota to develop next-gen autonomous vehicles using the safety-certified NVIDIA DriveOS.

Panasonic Holdings Corporation
Panasonic Holdings Group CEO Yuki Kusumi shared Panasonic Group’s vision for sustainability, artificial intelligence, and the health of future generations. DJ and record producer Steve Aoki jump-started the keynote with a performance before Mr. Kusumi, joined on stage by Marvel actor Anthony Mackie and other Panasonic Group leaders, delivered Panasonic’s “Well Into the Future” message. As an extension of the current Panasonic Well portfolio, Panasonic announced Umi, a holistic digital family wellness platform and coach.

SiriusXM
Jennifer Witz, CEO, SiriusXM, joined Ashley Flowers, #1 female podcaster in the U.S. and host of the hit podcast Crime Junkie, on the C Space stage to deliver a keynote on the intersection of technology, creativity, and storytelling in audio. The conversation covered the importance of authenticity, how AI is changing the creative landscape, and adapting consumer interests.

X Corp.
Linda Yaccarino, CEO, X Corp., spoke with award-winning journalist Catherine Herridge about how the company is defining the future of digital communication. The conversation focused on X’s transformational work to create a “global newsroom in your pocket.” Yaccarino highlighted the significance of Meta’s announcement that the company will follow X’s lead in adopting a community notes approach to content moderation.

Delta Air Lines at Sphere
The first keynote at Sphere in CES history wowed over 8000 attendees! The immersive experience spotlighted Delta Air Lines’ innovations in seamless travel, onboard experiences, and the future of flight. Ed Bastian, CEO, Delta Air Lines, announced Delta Concierge and partnerships with Airbus, DraftKings, Joby, Uber, and YouTube. Special guests included actress Viola Davis, football legend Tom Brady, and GRAMMY-winning icon Lenny Kravitz.

Volvo Group
Martin Lundstedt, President and CEO, Volvo Group, emphasized the company’s commitment to building a safer, more sustainable, and more productive future. He called on policymakers and industry leaders to accelerate the transition to zero emission vehicles and discussed the company’s partnership with Aurora, aimed at advancing the development of safer, self-driving vehicles.

Accenture
Julie Sweet, Chair and CEO, Accenture, discussed how data, AI, and new ways of working are transforming industries and addressing global challenges with Julia Boorstin, CNBC senior media & tech correspondent. Sweet emphasized the need for businesses to build trust in AI technologies, especially as AI becomes increasingly autonomous in a society where trust is scarce. She also highlighted Accenture’s 25th annual Tech Vision, which explores the paths leaders can take when AI is ubiquitous.

Waymo
Tekedra Mawakana, co-CEO, Waymo, spoke with Bloomberg Technology’s Ed Ludlow on the company’s progress in developing its self-driving technology, Waymo Driver. Mawakana emphasized safety and expanding its autonomous ride-hailing service to new cities while showcasing advancements in technology and outlining a vision for a safer and more accessible future.

Conference Programming
CES 2025 offered more than 300 conference sessions, exploring how tech solves some of the world’s greatest challenges.

C Space – C Space at ARIA brought together thousands of senior-level marketing professionals to explore the intersection of technology, media, and branding. Attendees heard from leading industry innovators from brands like Reddit, NBCUniversal, and Microsoft Advertising about how technology is shaping the future of storytelling, consumer engagement, and brand strategy. C Space sessions emphasized the importance of creativity and authenticity in navigating the ever-evolving digital landscape.CES Creator Space – The first-ever CES Creator Space, presented by Sony, gathered storytellers to network, create content, and relax in between visiting exhibitors. Sessions led by industry experts helped creators elevate their craft, featuring discussions on storytelling, content monetization, brand partnerships, rights and ownership, and more.Digital Health Summit brought together the entire health ecosystem to learn, network, and explore the role technology plays in advancing and reforming medicine, healthcare, and consumer wellness.Great Minds series explored the intersection of technology and humanity. Speakers included C-Suite executives, philanthropists, influencers, government leaders, entrepreneurs, venture capitalists, and more.Innovation for All Track included dedicated programming focused on ensuring all voices are represented in technology and innovation, bringing together thought leaders for a series of engagement opportunities, dynamic session content, and networking events.Innovation Policy Summit advanced CTA’s Innovation Agenda. CES brought together policymakers and government guests from around the world to discuss domestic and global tech policy issues including AI, privacy, trade, competition, and more. Conference sessions featured high-level government speakers from the White House, Department of Commerce, Department of Homeland Security, Department of Transportation, Federal Communications Commission, Federal Maritime Commission, Federal Trade Commission, and more.Mobility Stage made its debut in West Hall, exploring the future of mobility tech on the CES show floor. Topics included AI, connected vehicles, software, supply chain, and more.Quantum Means Business, a multi-session conference track developed with Quantum World Congress, gathered some of the brightest quantum minds, showcasing breakthroughs that were once confined to science fiction. Industry leaders from IBM, Microsoft, and beyond shared insights into how quantum, paired with advancements in AI and machine learning, creates unparalleled opportunities across industries.Startup Stage in Eureka Park brought together visionaries to discuss AI, health, startup funding, and more.

Celebrities at CES
Celebrity brand ambassadors like Alexis Ohanian, Denim Richards, Karlie Kloss, Maria Shriver, Mark Cuban, Martha Stewart, Meghan Trainor, Sophia Bush, Stevie Wonder, Terry Crews, Tim Meadows, Tunde Oyeneyin, and will.i.am attended the show. Read more about CES 2025 celebrity guest participation here.

Visit CES or the CES App, sponsored by Panasonic, for keynotes, sessions, and product announcements. View the high-res image gallery and download B-roll. Check out news from this week with CTA press releases including CTA’s U.S. Consumer Technology One-Year Industry Forecast, CES 2025 Green Grants, CTA 2025 Global Innovation Scorecard, CES 2025 Open, and a new investment in Quantum Word Congress.

We’ll DIVE IN again as CES returns to Las Vegas January 6-9, 2026.

About CES®:
CES is the most powerful tech event in the world – the proving ground for breakthrough technologies and global innovators. This is where the world’s biggest brands do business and meet new partners, and the sharpest innovators hit the stage. Owned and produced by the Consumer Technology Association (CTA) ®, CES features every aspect of the tech sector. CES 2025 takes place Jan. 7-10, 2025, in Las Vegas. Learn more at CES.tech and follow CES on social.

About Consumer Technology Association (CTA)®:
As North America’s largest technology trade association, CTA is the tech sector. Our members are the world’s leading innovators – from startups to global brands – helping support more than 18 million American jobs. CTA owns and produces CES® – the most powerful tech event in the world. Find us at CTA.tech. Follow us @CTAtech.

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SOURCE Consumer Technology Association

Technology

KNEX Technology CTO Gustavo Gonzalez Elected 2025 President-Elect of OATUG

Published

8 hours ago

January 11, 2025

Gustavo Gonzalez, KNEX Technology’s CTO, has been elected 2025 President-Elect of OATUG, emphasizing his dedication to Oracle innovation, collaboration, and leadership, including Ascend 2025’s strategic initiatives.

IRVINE, Calif., Jan. 10, 2025 /PRNewswire-PRWeb/ — KNEX Technology, a leading Oracle Cloud solutions provider, is proud to announce that its Chief Technology Officer, Gustavo Gonzalez, has been elected as the 2025 President-Elect of the Oracle Applications & Technology Users Group (OATUG). This esteemed appointment highlights Gonzalez’s longstanding commitment to advancing innovation and collaboration within the Oracle community.

OATUG has played a pivotal role in my professional growth, and it is a privilege to contribute to this community which has enriched my career. As President-Elect, I look forward to collaborating with my peers to strengthen the Oracle user community and further its impact on businesses worldwide.

In his new role, Gonzalez will work closely with the OATUG leadership team throughout 2025, preparing to serve as OATUG President in 2026. He will focus on empowering Oracle professionals worldwide by fostering knowledge-sharing, community engagement, and professional development. OATUG, a globally recognized organization, supports its members in overcoming challenges, enhancing the value of Oracle solutions, and driving organizational success.

“OATUG has played a pivotal role in my professional growth, and it is a privilege to contribute to this community which has enriched my career,” said Gustavo Gonzalez. “As President-Elect, I look forward to collaborating with my peers to strengthen the Oracle user community and further its impact on businesses worldwide.”

Gonzalez’s election underscores his dedication to giving back to the Oracle ecosystem. A key focus of his role will include shaping OATUG’s strategic initiatives, such as the annual Ascend Conference, which unites Oracle users, thought leaders, and technology innovators for unparalleled learning and networking opportunities.

The upcoming Ascend 2025 Conference, scheduled for June 8–11 in Orlando, Florida, promises to build on the success of the 2024 event, which attracted more than 1,800 attendees. With early bird registration now open, Gonzalez aims to ensure the conference continues to deliver transformative insights and experiences for the Oracle community.

About OATUG

The Oracle Applications & Technology Users Group (OATUG) is the premier global organization for Oracle users, providing year-round education, networking, and advocacy. OATUG empowers its members to unlock the full potential of Oracle solutions, fostering innovation and collaboration across industries.

About KNEX Technology

KNEX Technology is a trusted leader in Oracle Cloud solutions, delivering cutting-edge products and services to help businesses achieve their objectives. Through its innovative approach and customer-focused strategies, KNEX enables organizations to navigate the complexities of today’s technology landscape. For more information, visit www.knextech.com.

Media Contact

Husna Gyasi, KNEX Technology, 1 (949) 232-0786, husna.ghayaisi@knextech.com, https://knextech.com/

Twitter, LinkedIn

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SOURCE KNEX Technology