Significant redundancies at IT behemoth IBM were the main cause of a decline in revenue for the firm in the second quarter of 2013, but the company was still able to revise its full-year earnings forecast upwards to $16.90 per share, helped by strong mainframe and software sales.
IBM took $24.9bn in revenue, up six percent on its $23.4bn Q1 takings, but down three percent compared to the same period in 2012 of $25.8bn revenue. This equated to $3.2bn in profit for the quarter, down 17 percent year-on-year.
Much of the downward earnings trend was attributed to the layoffs the company enacted earlier this month, with a reported 1,600 staff made redundant. IBM said that it took $1bn to cover these costs.
The company's software division performed strongly, with a four percent revenue hike year-on-year. IBM attributed its software success to its WebSphere, Information Management and Tivoli products.
Meanwhile, its hardware divisions fell by 12 percent with only its System z mainframe servers seeing an increase; revenue from the products rose by 10 percent.
IBM's chief executive Ginni Rometty said the company had delivered strong performance but would continue to seek out underperforming areas. "In the second quarter, we delivered strong performance in our higher-value software and mainframe businesses and again significantly increased our services backlog on growth in new business.
"Going forward, we will continue investing in our strategic growth initiatives, acquiring and divesting capabilities, rebalancing skills and taking action in the areas that are not performing."
Earlier this year, Chinese laptop giant Lenovo was reportedly eyeing up IBM's low-end x86 server business, seven years after buying out the company's PC division. Neither company chose to comment on the matter.
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