Games/Interactive

IBM’s cloud offerings provided a significant lift for the company in its first quarter (ended March 31), with cloud revenue growing 35% to $3.5 billion, the company said April 18. The cloud business was led by IBM’s Cloud as a Service offerings, where revenue grew more than 60%, CFO Martin Schroeter said on an earnings call with analysts.

IBM continued to see strong results in its overall “strategic imperative” business areas, which, in addition to cloud, also include analytics, mobile and security initiatives. Total strategic imperative revenue grew 13%, with analytics — the largest of IBM’s strategic areas — up 7% percent, mobile up more than 20%, and security up 10%, Schroeter said.

Over the past 12 months, IBM’s combined strategic imperatives generated almost $34 billion in revenue, and now represent 42% of its total revenue, he said. With more than $14.5 billion dollars in cloud revenue over the last twelve months, IBM is the “global leader in enterprise cloud,” he told analysts.

IBM, meanwhile, “extended the reach” of its Watson artificial intelligence- (AI) driven computing platform and the IBM Cloud in the first quarter via its partnership with Visa, where Watson IoT turns cars, appliances and other connected devices into potential points of sale,” and through its alliance with Samsung, where The Weather Company “will be the default weather app on new Samsung devices, powering the weather experience for tens of millions of devices by the end of the year,” he said.

In the first quarter, IBM also announced a strategic partnership with Salesforce to deliver joint solutions designed to leverage AI and “enable companies to make smarter, faster decisions across sales, service and marketing,” he pointed out.

Security also contributed to growth in the first quarter, “driven again by areas such as data security and security intelligence,” Schroeter said. He added: “We’ve had strong traction in Watson for cyber security, since launching in February, and deployed it in over 50 customers globally. And we embedded cognitive into another offering, MaaS360 Advisor, using machine learning to analyze and protect devices.”

IBM is also “building emerging technologies on the IBM Cloud, like blockchain and quantum,” Schroeter noted. In blockchain, IBM had more than 40 “new engagements” in the quarter, and it’s “working on over 400 more,” he said, adding the opportunities there “span multiple industries.”

Revenue from Cognitive Solutions (including Solutions Software and Transaction Processing Software) grew from $4 billion a year earlier to $4.1 billion, “driven by growth in analytics and security, which include Watson-related offerings,” IBM said in its earnings news release.

But IBM shares were down 5.42% at $160.83 in late morning trading April 19, after the company reported its results. Despite the strength in IBM’s strategic imperative initiatives, other parts of its business didn’t fare as well. Total IBM revenue fell to $18.2 billion from $18.7 billion in the same quarter a year earlier. Profit fell to $1.8 billion from $2 billion.