IBM Revenue Declines for 20th Consecutive Quarter

The transcript discusses IBM's financial performance, highlighting declining revenue and gross profit margins. Despite this, pre-tax margins improved due to cost-cutting measures, particularly in SGNA expenses. The company maintains its non-GAAP EPS guidance for the year. The cloud business shows growth, but not enough to offset declines in legacy businesses. IBM's employment strategy involves layoffs in non-growth areas while potentially hiring in growth sectors like AI and cloud. The future outlook hinges on understanding gross margin declines and the potential for newer products to improve margins.

What was a positive financial outcome for IBM despite the decline in revenue and gross profit margin?

• Increase in SGNA expenses

• Increase in pre-tax margin

• Increase in gross profit margin

• Increase in legacy business revenue

What is the main reason for the increase in IBM's pre-tax margin?

• Expansion of legacy businesses

• Cost-cutting in SGNA

• Increase in cloud revenue

• Increase in R&D spending

What is the growth percentage of IBM's cloud business?

• 25%

• 40%

• 35%

• 30%

What is a significant challenge for IBM's cloud growth?

• It is not aligned with IBM's strategic goals

• It is causing an increase in SGNA expenses

• It is not enough to offset the decline in legacy businesses

• It is leading to a decrease in R&D spending

What is a major focus of IBM's cost-cutting strategy?

• Expanding into new markets

• Increasing marketing expenses

• Cutting employee costs in legacy businesses

• Reducing R&D spending