IBM (NYSE: IBM) shares are plummeting on Friday following the company's Q4 earnings report that showed it's revenue fell 6.5%, a larger than anticipated drop.
IBM’s stock price fell as low as $117.37 per share after the open and is currently down 10.24% at $118.20, levels not seen since November 2020.
The US technology company stated that it expected to return to growth in 2021, providing revenue guidance that it had previously removed due to the pandemic last year.
The US-based firm’s fourth-quarter revenue came in at $20.4 billion, below the $20.6 billion Wall Street consensus. Non-GAAP profits were $2.07 per share, ahead of the Street consensus of $1.79 per share.
IBM projected its 2021 adjusted cash flow at between $11 billion and $12 billion, an increase of $10.8 billion from the previous year, while its full-year adjusted cash flow for 2022 is expected to be between $12 billion and $13 billion.
The quarter's total cloud revenue was $7.5 billion up 10% while Red Hat revenue rose 19%. The business also reduced its debt by $3.9 billion during the last quarter of 2020.
“In 2020 we increased investment in our business across R&D and CAPEX, and since October, announced the acquisition of seven companies focused on hybrid cloud and AI,” commented James Kavanaugh, IBM senior vice president and chief financial officer.
“With solid cash generation, steadily expanding gross profit margins, disciplined financial management and ample liquidity, we are well positioned for success as the leading hybrid cloud platform company,” Kavanaugh added.
