IBM bucks trend with 12% rise in profit

IBM has defied the economic gloom by posting a 12% rise in quarterly profit and forecasting higher earnings in 2009.

The global hardware, software and services giant earned $4.4 billion for the quarter on revenue of $27 billion, down 1%. 

It made a pre-tax profit of $16.7 billion on $103 billion sales over the full year, with earnings per share a record $8.93, IBM said.

'A strong fourth quarter capped an outstanding year," said chairman and CEO Sam Palmisano.

"With our strong financial position, solid recurring revenue and profit streams and global reach, we are confident about 2009 and, based on our 2008 performance, we are ahead of pace on our roadmap for $10 to $11 per share," he said.

It expects full-year 2009 earnings of at least $9.20 per share.

Quarterly software revenue rose 9% to $6.4 billion and middleware sales were up 4% to $5.2 billion. However, global technology services revenue was up 3% and business services sales were flat. Asia-Pacific revenue fell 1% to $5.5 billion.

"Clearly our strategic transformation - migrating to the more profitable segments of the industry, investing in growth regions of the world, and driving productivity through global integration - is continuing to pay dividends," Palmisano said.