Equities

IBM earnings Q3 2019


Ginni Rometty, Chairwoman, President and CEO of IBM, at the World Economic Forum in Davos, Switzerland.David A. Grogan | CNBCIBM will announce third-quarter earnings after market close on Wednesday.Here are the numbers to watch:Earnings: Excluding certain items, $2.67 per share expected by analysts, according to Refinitiv.Revenue: $18.22 billion expected by analysts, according to Refinitiv.If IBM’s revenue comes in at that level, revenue would be lower on an annualized basis for the fifth consecutive quarter, even with contributions from Red Hat, an acquisition that closed in the third quarter.In the third quarter, IBM lowered its full-year earnings estimate to take into account the impact from Red Hat, pointing to the suspension of share buybacks, an adjustment to the balance of deferred Red Hat revenue and equity and retention costs. The company announced deals with AT&T, Avaya and the Bank of China, and it introduced the z15 mainframe computer.”We think the combination of new products should enable the company’s Systems segment to revert to growth in CY20 following recent declines (wind down of z14 cycle),” Evercore ISI analyst Amit Daryanani, who has the equivalent of a buy rating on IBM stock, wrote in a note distributed to clients on Monday. “Assuming the z15 will be consistent with prior cycles, we think this positions IBM for solid y/y growth in CY20 (strongest hardware quarters within a cycle typically occur in the first 1-2 quarters post a mainframe launch).”IBM shares are up about 25% since the beginning of the year.Analysts polled by Refinitiv expect $12.81 in earnings per share, excluding certain items, for all of 2019.Executives will discuss the results with analysts on a telephone conference at 5 p.m. Eastern time.This is breaking news. Please check back for updates.WATCH: IBM CEO: We’ll be in the UK for the next 100 years, whatever happens with Brexit

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