Exceeding analyst expectations, IBM has announced fourth-quarter 1997 net earnings of $US2.1 billion, or $2.16 per common share, an earnings per share increase of 10% compared to net earnings of $2 billion, or $1.97 per common share, in the fourth quarter of 1996.
Assuming dilution, which includes such factors as stock options which can dilute share value over time, net earnings per share of common stock were $2.11 in the fourth quarter of 1997 compared with $1.93 per common share in the fourth quarter of 1996. For full-year 1997, net earnings per share of common stock, assuming dilution, were $6.01 compared with $5.41 per share during the year-earlier period.
Fourth-quarter 1997 revenues increased 3 percent (8 percent at constant currency) year over year to a record $23.7 billion.
Net earnings for the 12 months ended Dec. 31, 1997 were $6.1 billion, or a record $6.18 per common share, compared with net earnings of $5.9 billion, or $5.53 per common share, in 1996. The 1996 figure excludes a charge associated with research and development related to acquisitions in the first quarter of 1996. Including this charge, 1996 net earnings were $5.4 billion, or $5.12 per common share.
Revenues for the fiscal year were $78.5 billion, also a record, representing an increase of 3% (8% at constant currency) from the prior year's $75.9 billion.
The results were achieved despite negative consequences of foreign exchange rates, noted company chairman and CEO Louis V. Gerstner, in a statement.
The financial results compare to a forecast of $2.15 per share of common stock by 20 analysts polled by the First Call Corp. research service. The range of the estimates was from $1.82 to $2.25. For the entire year, the analysts forecast $6.17 per share, with estimates ranging from $5.85 to $6.25.