Strong sales from its PC and services and software group helped IBM beat Wall Street expectations to turn in a $1.5 billion profit for its fiscal first quarter.
Lou Gerstner, IBM chief executive, praised the company's improved sales in Asia plus the double digit growth in Europe and the Americas.
In terms of products, its service and software group represented 60 per cent of Big Blue's gross profit for the quarter ended 31 March.
However, Gerstner admitted that results from its technology group, were mixed, with growth in hard disk drives depressed by continued weakness in memory chips.
But, "What's more exciting is that this quarter's performance is a direct reflection of the power of the strategies we have put in place over the last few years," Gerstner continued.
The $1.5 billion profit was up from last year's figure of $1 billion, while revenue jumped 15 per cent to $20.3 billion. Earnings per share were $1.55, surpassing predictions of $1.41.
Revenue from Europe, Middle East and Africa were $6.3 billion, an increase of 20 per cent, while the Americas grew 13 per cent to $8.8 billion.
The Global Services business, which includes maintenance, leapt 19 per cent to $7.6 billion, as it signed $9.8 billion worth of service contracts during the quarter. Software revenue increased by 10 per cent to $2.9 billion, with strong sales in databases, Lotus Notes and transaction processing products.
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