Company News: IBM beats expectations; profits rise 11 percent
Fourth-quarter profit at International Business Machines Corp. rose 11 percent and beat Wall Street expectations Thursday, and the company also delivered a blockbuster figure in services contract signings, an important measure of future revenue.
In the last three months of 2006, IBM earned $3.54 billion, $2.31 per share, on revenue of $26.3 billion. The numbers were boosted 6 cents per share by a lower tax rate and 5 cents per share from gains related to discontinued operations.
Even without those bumps, the company beat the consensus of analysts surveyed by Thomson Financial. Wall Street was expecting profit of $2.19 per share and revenue of $25.7 billion.
Still, investors were not impressed. Shares of IBM lost $4.25, or more than 4 percent, in extended-session trading. Before the results were announced, the stock lost 57 cents to close at $99.45 on the New York Stock Exchange.
The figures all surpassed last year’s results, when profit was $3.19 billion, $1.99 per share, and revenue was $24.4 billion. However, profit in that comparison quarter was dragged down about $200 million after taxes, or 12 cents per share, by a one-time accounting charge and costs IBM incurred in freezing its pension plan.
“Internet powerhouse Yahoo Inc. will begin dispensing advice about personal finances in its latest bid to bolster its own finances.
The new money management package, scheduled to make its debut Thursday night, is being offered as an extension of Yahoo’s decade-old finance section — one of the Web’s top-ranked destinations for business and investment information.
Yahoo decided to widen its focus to include more simple money matters because many people are more interested in balancing their checkbooks than juggling their stock portfolios, said Scott Moore, who runs the Sunnyvale-based company’s news and information division.
The personal finance section will include tips and tools for household budgeting, tax planning, careers, real estate and debt management. Most of the content will be provided by other sources, including The Wall Street Journal, The Motley Fool, Consumer Reports and CNNMoney.com.
By reaching out to a broader audience, Yahoo hopes to lure more advertisers and accelerate recently lackluster revenue growth that has lagged far behind the pace of Internet search leader Google Inc.