IBM Profits Rose Nearly 20 Percent

IBM on Thursday reported third-quarter earnings higher than Wall Street expectations. IBM hardware profits were lower but overall revenue rose nearly 20 percent. The business technology company also said that earnings were from a steady base of recurring revenue.

International Business Machines Corp on reported higher quarterly profit on Thursday. While hardware sales declined, the business technology company had an increase in services and software revenue.

IBM net profits rose 19.6 percent in the third-quarter, compared with the same period last year, to 2.8 billion dollars while revenue rose five percent to 25.3 billion dollars.

"Our results demonstrate that the combination of a steady base of recurring revenue and profits, a range of products and services that deliver value to clients worldwide, and a strong and flexible financial foundation give IBM a competitive edge in good times and tough times," IBM chairman Samuel Palmisano said in a statement.

IBM's services business is the largest segment. The segment climbed 8 percent to $14.8 billion. The company's software division is the most profitable with a climb of 12 percent to 5.2 billion.

IBM hardware sales fell 10 percent to $4.4 billion.

The business technology company remains confident in its 2008 outlook. IBM said that its investments for growth in emerging countries have enabled the company to thrive despite the global economic crises.