IBM Fights Slack Revenues With New Products - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
News

IBM Fights Slack Revenues With New Products

IBM's strength in E-business is its ability to offer computers ranging from palmtops to high-end mainframes. Its weakness is selling them. The disconnect was painfully clear in IBM's first- quarter financial results, released last week. Stagnant software and services revenue played a part, but what really hurt was the 12% decline in hardware sales, compared with a year ago.

All told, IBM's first-quarter revenue declined 5%, from $20.32 billion in the same period last year to $19.35 billion. It's the second bad showing in a row for IBM's hardware business. In the fourth quarter, server sales plunged 33% compared with a year earlier. At the time, IBM CEO Louis Gerstner reportedly warned employees that they had two quarters to turn things around.

This week, IBM is expected to introduce a slimmed-down PC, the first in its EON-class machines. Next, IBM will introduce a low- cost midrange Unix server--the RS 6000 M80--that's aimed squarely at Sun Microsystems' dominance in Web servers. Separately, IBM plans to expand its use of ultrafast copper chips beyond its RS/6000 line, giving more zip to its other server platforms. And it's about to adopt the Linux operating system for use on its mainframes, potentially expanding the universe of mainframe applications and users. To bring more efficiency across all its hardware lines, IBM says it intends to share more components among its various systems.

Even considering corporate and distribution makeovers in the works, some analysts think more changes may be needed. "There's too much [product] overlap, and it's confusing to customers," says Bob Sutherland of Technology Business Research. Salomon Smith Barney's John Jones gives IBM's PC business a 50-50 chance of survival.

IBM insists it isn't killing any product lines. The irony: Those product lines seem to be killing IBM.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of IT & Cybersecurity Operations 2020
The State of IT & Cybersecurity Operations 2020
Download this report from InformationWeek, in partnership with Dark Reading, to learn more about how today's IT operations teams work with cybersecurity operations, what technologies they are using, and how they communicate and share responsibility--or create risk by failing to do so. Get it now!
Slideshows
IT Careers: 10 Industries with Job Openings Right Now
Cynthia Harvey, Freelance Journalist, InformationWeek,  5/27/2020
Commentary
How 5G Rollout May Benefit Businesses More than Consumers
Joao-Pierre S. Ruth, Senior Writer,  5/21/2020
News
IT Leadership in Education: Getting Online School Right
Jessica Davis, Senior Editor, Enterprise Apps,  5/20/2020
Register for InformationWeek Newsletters
Video
Current Issue
Key to Cloud Success: The Right Management
This IT Trend highlights some of the steps IT teams can take to keep their cloud environments running in a safe, efficient manner.
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll