As IBM begins to lay the groundwork for the largest divestiture ever, CEO Arvind Krishna this week elaborated on a long-term strategy, one of which may involve more acquisitions, which he believes is countering the recent decline in revenue. .
Krishna (Krishna) described a radical plan to investors, not only for IBM, but also for NewCo, this is a public transaction spin-off of a large part of IBM GTS consulting business, which will create an IT service Strong country.
Krishna said: “Even in these uncertain times, we can still determine our direction.”
Krishna introduced the financial status of the third quarter as of September 30, said that by focusing on Red Hat and other transformational software products to simplify and optimize its operating model has been fully implemented.
When IBM arranges the spin-off of Global Technology Services, it will increase its investment in another consulting department, Global Business Services, and the core technology of hybrid cloud.
Big Blue will also make more investments in ecosystem expansion, form alliances with large partners such as ServiceNow, Adobe, and Salesforce, and hope to locate hundreds of ISVs on its hybrid cloud platform and other cloud features.
The upcoming investment in its software product portfolio (including through organic development and acquisitions) will focus on innovation driven by Red Hat and data, artificial intelligence and security products.
Krishna said: “We want all areas to contribute to growth.”
Krishna said that the new company’s investment will be in automation, infrastructure modernization and expanding the partner base.
He said that for IBM, the overall goal is to use Red Hat and a larger software portfolio that has been modernized to run cloud-native workloads to seize the $1 trillion hybrid cloud opportunity.
With the release of IBM’s third-quarter results, the transformation plan becomes clearer, and the performance continues to show a downward trend in each quarter of the fiscal year.
Giant Blue International’s revenue in the first quarter was $17.6 billion, a 2.6% decrease from the same period last year.
Cloud computing is a bright spot, with sales of $6 billion increased by 19%. Cloud and cognitive software grew by 7% year-on-year.
Revenue for the quarter slightly exceeded analysts’ expectations, with earnings per share of $2.58, which met analysts’ expectations.
Wall Street seems to have a far greater impact on the financial industry than Krishna’s roadmap for long-term growth: The shares of Giant Blue closed at $125.52 on Monday, and then fell to $121.82 in after-hours trading.
This article originally appeared on crn.com
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