(RTTNews) - Shares of International Business Machines Corp. (IBM) jumped 6% in extended trading session on Monday after both earnings and revenues for the second quarter trumped Wall Street analysts estimates, driven by growth in cloud sales.
Armonk, New York-based IBM reported second-quarter profit of $1.36 billion or $1.52 per share, compared to $2.50 billion or $2.81 per share last year.
Excluding items, IBM's adjusted earnings were $1.9 billion or $2.18 per share for the period. Analysts polled by Thomson Reuters expected earnings of $2.07 per share. Analysts' estimates typically exclude special items.
IBM's second-quarter revenues fell 5.4% to $18.12 billion from $19.16 billion last year. Analysts polled by Thomson Reuters expected revenues of $17.72 billion for the quarter.
"Our clients see the value of IBM's hybrid cloud platform, based on open technologies, at a time of unprecedented business disruption," said Arvind Krishna, IBM chief executive officer. "We are committed to building, with a growing ecosystem of partners, an enduring hybrid cloud platform that will serve as a powerful catalyst for innovation for our clients and the world."
IBM is divesting off its low-margin and unprofitable hardware businesses to improve profitability. The company is now striving hard to make IBM a company that provides cloud computing and data analytics.
Total cloud revenue was $6.3 billion, up 30 percent. Global Business Services, which includes Consulting, Application Management and Global Process Services, were $3.9 billion, down 7 percent.
Earlier this year, IBM withdrew its full-year guidance due to the COVID-19 crisis.
IBM closed Monday's trading at $126.37, up $1.26 or 1.01%, on the NYSE. The stock further gained $7.98 or 6.32% in the after-hours trade.
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