IBM reports sales light, but sees strong earnings outlook

IBM's first quarter was a mixed bag relative to expectations.

Big Blue reported first quarter earnings of $3.1 billion, or $2.61 a share, on revenue of $24.7 billion, a tally that was flat from a year ago. Non-GAAP earnings were $2.78 a share. Wall Street was looking for earnings of $2.65 a share on revenue of $24.77 billion.

The company raised its 2012 earnings outlook to $14.27 a share from at least $14.16 a share. Non-GAAP earnings will hit at least $15 a share, up from IBM's previous outlook of $14.85 a share.

Wall Street was looking for earnings of $14.94 a share for 2012.

IBM's first quarter lined up similarly to previous ones. Services backlog was flat, hardware was pressured, and emerging markets, analytics, and cloud represented growth.

By the numbers:

• Americas first quarter revenue was $10.5 billion, up 1 percent. Revenue from Europe, Middle East, and Africa was $7.6 billion, down 2 percent. Asia Pacific revenue was up 4 percent to $6.1 billion.
• Sales in the BRIC countries -- Brazil, Russia, India, and China -- jumped 10 percent.
• Global technology services revenue was up 2 percent in the first quarter to $10 billion.
• Business services revenue fell 2 percent to $4.6 billion.
• Software revenue was $5.6 billion, up 5 percent from a year ago. Middleware sales were up 7 percent from a year ago and operating systems revenue was up 9 percent.
• Hardware and systems revenue was $3.7 billion, down 7 percent from a year ago. Power Systems sales were flat as were System x revenue.

This story originally appeared at ZDNet's Between the Lines under the headline "IBM Q1 sales light, earnings outlook strong."