CFO Mark Loughridge stated last quarter that growth will be skewed towards the second half of 2012. Some traction and growth should be shown this quarter as this growth acceleration becomes evident. New CEO Ginni Rometty will have to wait until later in 2012 to attempt to top the stellar Q4 2011 financial results. We await.
IBM raised guidance last quarter on the full-year 2012 GAAP EPS to $14.27+ from $14.16+. The Non-GAAP outlook was increased to $15.00+ from $14.85+. Total assets place IBM in the Big Tech $100 Billion Club behind #1 Apple and #2 HP but ahead of #4 Microsoft.
IBM has a large, embedded product financing operation which results in a lower return on assets (+14%) than other technology companies. Financial position has been acceptable, with adequate capital, moderate debt, and sufficient liquidity.
For the current Q2 2012, the average analysts’ EPS estimate is $3.43, which is a strong +23% increase QoQ from the annual Q1 dip and an encouraging +11% YoY growth. Solid YoY growth in the future two quarters, Q3 and Q4, will be necessary to confirm the long-term EPS growth, which has been consistent so far.
Estimated QE June 2012 Earnings per Share (Non-GAAP)
Yahoo Finance Estimates: $3.42 avg, $3.31 low, $3.51 high, 22 analysts
Prior Quarter: $2.78
Prior Year: $3.09
Outlook: none provided
Estimated QE June 2012 Total Revenues (GAAP & Non-GAAP)
Yahoo Finance Estimates: $26.35B avg, $26.03B low, $26.84B high, 22 analysts
Prior Quarter: $24.67B
Prior Year: $26.67B
Outlook: none provided
Prior Quarter: IBM Earnings Take Annual Q1 Dip, Raises Outlook
IBM Income Statement Q1 2012 IBM reported total revenues of $24.67 billion, net income of $3.07 billion, and earnings per share of $2.61. From the prior quarter Q4 2011, these were -16%, -44%, and -44%, respectively. From the prior year Q1 2011, these were +0.27%, +7%, and +13%, respectively. Gross margin, operating margin, and net margin dipped QoQ but increased YoY. Cash flow from operations of $3.65 also decreased QoQ but increased YoY. The operating expense ratio of 29.31% increased QoQ and YoY to an 8-quarter high on lower revenues but stable expenses.
IBM Balance Sheet Q1 2012 Total assets dipped from the prior quarter record of $116.43 billion to $115.35 billion. The capital to assets ratio rebounded to 18.02% from a 9-quarter low of 17.38%. The current ratio of 42.35% is about the historical average. The return on assets of +14.13% is a multi-year high. Total debt at 27.79% of total assets is above the historical average.