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IBM saw an impressive performance on Wednesday evening trading, as its latest returns beat both top and bottom line estimates from investors.

Posting earnings of USD $3.08 a share for the second quarter of 2018, its result beat analyst predictions by $0.04. IBM’s total revenue figures also came in higher, with its $20bn total outreaching the $19.85bn Wall Street estimation. 

Full-year earnings narrowly exceeded market expectations of $13.78 a share by $0.02 per share. General shares rose 0.7% during the day’s trading to increase to $145.35.

Speaking about the news, IBM’s Chairman, President and CEO Ginni Rometty hailed “strong revenue and profit growth in the quarter”. Rometty went on to highlight this success story, especially “in the emerging, high-value segments” across the information and technology industries that the company typically operates in.

Recognizing IBM’s key positioning as a provider of services to allow for greater cloud implementation, Rometty suggested that these results were, in part, down to the continued increase in usage of “IBM Cloud, Watson AI, analytics, blockchain and security solutions”. Combining this with the company’s world-renowned knowledge base, industry leadership and trust are all part of its ability to post positive results this quarter.

The cloud technology aspect of IBM is the outstanding bright spot for the company, with its revenue climbing a significant 23% in just 12 months. Its current value now stands at USD $18.5bn.

However, this year to date, IBM shares are down 6%, and not all analysts see the latest results as being quite so rosy. 

Having underperformed on the S&P 500 over the last year at around 20%, IBM’s revenue growth is still below that of its rivals and peers, according to some analysts.

The main drivers of IBM’s Q2 figures stem mainly from its Systems arm, where revenues rose by an impressive 25% to $2.18bn. Sales of its Z mainframes, storage hardware and servers are also factors in this strong performance.

IBM’s Cognitive Solutions segment, in contrast, failed to beat estimations. Posting results of $4.58bn, it still managed to gain small growth on 2017 but was unable to top forecasts of $4.76bn. This sector also happens to be the one with the highest gross margin, which would go some way toward explaining its drop in non-GAAP gross margin, falling from 47.1% to 46.5%. Combat measures in place included a 2% decrease in operating costs and the buyback of $1bn in shares.

IBM CFO Jim Kavanaugh said that the lack of uptake in Cognitive Solutions is partly down to “transitions” across the business, notably in talent, collaboration and commerce software, though he noted that the company is imminently looking to modernize these fields.

Given that spending in the IT field is currently healthy, some analysts appear to have expected more from IBM, even if it beat their own expectations. As for other IBM segments, its Global Business Services (GBS) saw a healthy 2% revenue rise to post figures of $4.19bn, while its Technology Services and Cloud Platforms (TS & CP) also increased by 2% to reach $8.62bn.

With a better performance than seen in the first quarter of 2018, there is every chance that IBM will be able to beat estimates in Q3 even in light of dollar fluctuation.