Ibm Earnings Shoot Up 18.3 Percent

International Business Machines Corp. on Tuesday reported its fourth-quarter profits grew 18.3 percent, lifted by surging demand for computer services and stronger sales of software and hardware.

IBM said it earned $2.02 billion, or $3.93 per share, in the quarter ended Dec. 31. That was up from profits of $1.71 billion, or $3.09 per share, in the year-ago period.

Revenues rose 5.6 percent to $23.14 billion from $21.92 billion.

The profits were the latest sign of a rebound at the world’s largest computer company and generally fell within forecasts of industry analysts.

Analysts had expected IBM to report a per-share profit of $3.96, according to the mean of 15 published projections compiled by IBES International.

But some analysts had said that IBM would have to post earnings of at least $4 a share and revenue growth of 10 percent to satisfy rising enthusiasm about the company’s performance.

In other earnings Tuesday:

Burlington Northern Santa Fe Corp. said that its fourth-quarter profit rose 20 percent, slightly below analysts’ estimates as cost-cutting offset higher fuel expenses and severe weather problems.

The railroad company, which operates a large shipping yard in Spokane, reported net income of $244 million, or $1.56 a share, on sales of $2.09 billion for the quarter ended Dec. 31, 1996. That compared with profit on operations of $203 million, or $1.32 a share, on sales of $2.09 billion in the same period a year earlier.

In the fourth quarter of 1995, charges totaling $369 million for the merger of the two railroads and early debt retirement resulted in a net loss of $166 million, or $1.19 a share.

Wall Street analysts polled in advance had expected Burlington Northern Santa Fe to earn about $1.60 a share.

The company also warned investors that revenue this month could fall $25 million or more from the same month last year as harsh winter weather is impeding operations in some parts of the country.

Chrysler Corp. announced its second-best annual profit and a near-record $7,900 average profit-sharing payment for 96,500 U.S. workers.

The No. 3 U.S. automaker earned $807 million for the fourth quarter after several one-time charges, down 22 percent from the $1 billion it earned a year ago. Per-share earnings were slightly higher than Wall Street expected at $1.12 a share. That compared with $1.35 a share a year earlier after adjustment for a 2-for-1 stock split last July.

For the year, Chrysler posted a $3.5 billion profit, surpassed only by 1994’s $3.7 billion. The 1996 profit amounted to $4.77 a share, compared with $2 billion, or $2.65 a share, in the previous year.

The latest earnings results were depressed by several one-time charges totaling $279 million. They involved a loss on early debt retirement; a write-down in the value of its investment in Pentastar Electronics, which recently was sold; and higher pension and early retirement costs.

Without those charges, earnings for the quarter would have totaled $1.1 billion, or $1.51 a share, a fourth-quarter record.

Northwest Airlines Corp. said it earned $26 million for the fourth quarter, down from $53.5 million for the same quarter in 1995. Earnings per common share were 20 cents for the 1996 quarter, down from 41 cents in 1995.

Excluding the gain in 1995 related to a Japanese financing restructuring, net income for the quarter increased $22.4 million from $3.6 million in 1995.

The earnings were below analysts’ expectations of about 24 cents per share.

For the year, Northwest reported profits of $536 million, or $5.67 per share, on revenues of $9.9 billion. That compared with income of $392 million, or $4.17 per share, on revenues of $9.1 billion a year earlier.

Lucent Technologies Inc. reported record quarterly profits, rebounding from a year-ago loss amid robust sales of communications equipment.

The phone equipment company, spun off by AT&T Corp. last year, said it earned $859 million, or $1.35 a share, in its first fiscal quarter ended Dec. 31. That compared with a loss of $1.02 billion, or $1.60 a share, that Lucent would have reported if it were independent in the year-ago period. Those results were dragged down by the cost of restructuring the company.

The results were at the high end of expectations, with analysts forecasting per-share profits of up to $1.37. Lucent stock closed up 75 cents at $53.62-1/2 in trading Tuesday on the New York Stock Exchange.

The company cited strong sales of fiber optic cable, equipment for mobile phone networks and for second phone lines for access to the computer Internet, electronic mail and fax machines. And revenues grew sharply from sales of specialized microprocessor chips used in mobile phones, computer modems and other technology.

For all of calendar 1996, Lucent earned $1.08 billion, compared with a loss of $867 million in 1995. Lucent recorded $23.80 billion in 1996 revenues, up 11 percent from 1995 revenues of $21.41 billion.