Thread regarding IBM layoffs

What mainframe and Consulting gave, currency and Russia discontinuing took. All in all it was a slow and steady growth report (earnings beat by 4 cents and revenue beat by 400 million). The CFO said there was still approx 700 million of stranded costs to be dealt with. Another interesting statement coming from the analyst call was IBM said there is tens of thousands of employee churn per year in consulting. This actually is viewed by management as a self regulatory mechanism when times slow down.

I think the economy is moving backwards. Lots of tech layoffs. Why would we be not affected? Maybe a good quarter but the outlook has to be dim. Software is probably good.

I suspect IBM will surprise to the upside. Maybe 2-5 cents. The real number to look at is revenue. If that moves up, it shows IBM is incrementally moving in the right direction. IBM management wants to show slow but steady movement in one direction to confirm their strategy. Could they show larger gains? Absolutely! But that would mean the chance for incremental set backs into the future, SO slow but steady is the order of the day.

The street should be just about correct at the 6% number. Consulting is having a very good quarter. Infrastructure has no where to go but up with system Z coming on line. Redhat is still growing at double digits, BUT its still just 20% of all of SW, thus SW will be flat to low single digits. There will be a OT infusion of money from WH selloff, and we could certainly see a OT charge off of yet another piece of the business. IBM loves to obscure the number with an all in “special” Remember IBM predicted high single digit growth at the last earnings call, and with the additional head winds (currency, salary inflation, and specials), 6% sounds about right. The sands of the legacy (HW and SW) go to market strategy (except for enterprise) are shifting on IBM at warp speed. IBM can’t hold back that tide as they missed the cloud boat, and until they decides what to do with that legacy, there will always be uncertainty about IBM’s earnings. GTS was the first great issue to deal with, and Kyndryls performance over the last 6 months proves that. Legacy is the next great issue to deal with, and IBM has to bite the bullet and deal with it. Otherwise it will continue to be a drag on IBM’s new strategy and weigh on IBM’s growth picture.

Oh, and of course they'll report all the numbers in "Non-GAAP," so they're easier to fudge (I'm still perplexed as to why they're allowed to do that).

I predict another "One-time, non-recurring charge against earnings." Ya know, the same charges that we see every Quarter that are neither "one-time" nor "non-recurring."

The numbers should be fine but not great as usual. Will watch carefully the Systems numbers and the Z16 contribution. Heard today that the Integration space in Software did fantastic this quarter.