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Boston (pte032/19.07.2005/15:27) - IBM - International Business Machines Corp - http://www.ibm.com bounced back from a disappointing first quarter, and surpassed analysts' expectations.
However the second-quarter figures were buoyed by three external events, which are not usually included when assessing a company's performance: the company posted gains from selling its PC division to Lenovo ($1.1 billion), and an antitrust settlement with Microsoft ($775 million), and benefited from sacking about 14,500 employees, mostly in Europe ($1.7 billion). But the service division lifted the IBM's figures.
IBM showed net profit of $1.83 billion, or $1.12 per share in the quarter that ended on 30th June, compared with $1.74 billion, or $1.01 per share, in the previous year. But during that time IBM's personal computer division was sold to China's Lenovo Group Ltd., lowering its figures posted in the remaining two months of the quarter because it closed on 1st May.
Continuing operations only considered, IBM showed a profit of $1.85 billion, $1.14 per share.
Second-quarter revenue was down 4 per cent ($23.10 billion) a year ago to $22.27 billion. Without the one month of the PC business sales, IBM's revenue would have been about $21.70 billion.
Analyst Richard Petersen of Pacific Crest Securities said, "Not only has their business bounced back, which was expected, but above and beyond that, they appear to be doing a better job executing, and demand seems to be improving in some areas of their business."
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