In connection with the protracted process of business transformation with a focus on clouds, analytics, mobile technologies and data protection, IBM continues to lose revenue for the sixth year in a row.

The next drop in revenue and profit.

IBM's quarterly revenue for April-June 2017. Fell to $ 19.29 billion, down by 4.69% compared to the previous quarter and by 3.25% compared with the same period in 2016. Analysts predicted a quarterly sales of IBM at $ 19.5 billion.

IBM's net profit in the second quarter was $ 2.33 billion, a year-on-year decrease of 6.9%, diluted earnings per share were $ 2.48, with analysts expecting $ 2.74 a year earlier to be $ 2.61.

The company's revenue decline was the most significant in the last five quarters, while IBM's revenue has been steadily declining over the past 21 fiscal quarters.

IBM's revenue for the first six months of 2017. Amounted to $ 37.44 billion, which is 3.8% less than a year ago. Net profit IBM in January-June fell to $ 4.08 billion, a decrease of 9.65% compared with the first half of 2016. Diluted earnings per share for the half-year was $ 4.32 against $ 4.69 a year earlier.

The company's shares after the closure of US exchanges fell by 2.99% to $ 149.39 per share, the trading session ended at $ 154 per share. Since the beginning of the year, the value of IBM shares has fallen by 7.2%, although the stock index Dow Jones Industrial Average for this period has grown by 9.2%.

IBM confirmed the forecasts for the annual horizon of earnings per share at $ 11.95 (GAAP). The annual profit without taking into account one-off factors will be at least $ 13.8 per share. Free cash flow is expected at the level of the previous year.

Following the results of 2017 г. The company expects that free cash flow will remain relatively unchanged. According to the company's forecast, diluted earnings per share in 2017. Will be 11.95 dollars. The adjusted figure is expected at the level of 13.80 dollars.

Transformation of the company is uneven.

The continuing deterioration of financial performance in IBM is associated with depreciation of acquired intangible assets and related acquisitions of costs.

Over the past few years, IBM has made powerful investments in the field of cognitive computing, artificial intelligence and cloud computing, betting on its Watson IT platform. Nevertheless, the long-awaited growth in revenues from "strategic imperatives" has not yet come.

At the same time, IBM notes an increase in revenues from long-term investments. Thus, the revenue of the cloud technology division rose to $ 3.9 billion, an increase of 15%, and sales of analytical solutions brought the company $ 5.1 billion - 4% more than in the same period last year.

At present, the complex of "strategic imperatives" provides up to 45% of the company's total revenue, while in Q1. 2017 g. This contribution did not exceed 42.8%.

Mainframe betting.

Another business line, the development of which should revitalize the sale of IBM - is the mainframe. On Monday, IBM introduced a new generation of mainframe next generation IBM Z, which are capable of processing more than 12 billion encrypted operations a day. The systems use the advanced encryption mechanism, which for the first time will allow continuous encryption of data associated with any application, cloud service or database.

The new IBM Z encryption capabilities are designed to "combat the global epidemic of data theft". Advanced cryptographic capabilities of the system now extend to any data, networks, external devices or entire applications, such as IBM Cloud Blockchain. They do not require changes in applications and do not affect service level agreements.

Nevertheless, according to the financial forecast of IBM, the company's revenue from mainframes will not have a significant impact on the results of III quarter.

, As sales start only in September. Most of the revenue from the mainframe is expected by the end of the year.

"In terms of revenue, we tend to see a decline of about $ 1 billion in the second and third quarter for seasonal reasons," said Martin Schroeter, IBM CFO. "This traditional reduction could reduce the revenue from mainframe sales or service contracts increased by $ 200- $ 300 million, but more we will see these revenues in the third quarter, and mostly in the fourth".