8-KRegulation FDExhibits & Filings

INTERNATIONAL BUSINESS MACHINES CORP 8-K Report, Regulation FD Disclosure (Oct 20, 2020)

Filed October 20, 2020For Securities:IBM

Summary

This 8-K filing from IBM, dated October 19, 2020, primarily contains information related to their third-quarter 2020 earnings presentation and forward-looking guidance. The company provided prepared remarks from its CEO and CFO, along with non-GAAP financial reconciliations. Key takeaways for investors revolve around revenue and earnings per share expectations for the upcoming fourth quarter and a medium-term outlook for sustainable growth, particularly after the planned separation of its managed infrastructure services business. IBM anticipates revenue to increase from Q3 to Q4 2020 in line with historical patterns. Operating earnings per share (non-GAAP) are expected to see a percentage increase consistent with or slightly above historical averages, despite a significant $2.3 billion charge for structural actions in Q4. Looking further ahead, the company projects mid-single-digit revenue growth in the medium term, with improvements expected to become evident by mid-2021, targeting pre-COVID growth rates for segments like Global Business Services.

Key Highlights

  • 1IBM presented prepared remarks and non-GAAP financial reconciliations for its Q3 2020 earnings on October 19, 2020.
  • 2The company expects Q3 to Q4 2020 revenue dollar increase to be in line with historical averages.
  • 3Operating (non-GAAP) EPS percentage increase from Q3 to Q4 2020 is expected to be consistent with or slightly ahead of historical averages.
  • 4A $2.3 billion charge for structural actions is anticipated in the fourth quarter of 2020.
  • 5IBM projects sustainable mid-single-digit revenue growth in the medium term, post-separation of its managed infrastructure services business.
  • 6The company expects to show improving revenue growth by mid-2021, targeting pre-COVID growth rates for segments like Global Business Services.

Frequently Asked Questions

The primary purpose of this 8-K filing is to disclose information presented during IBM's third-quarter 2020 earnings presentation, including prepared remarks from the CEO and CFO, and reconciliations of non-GAAP financial measures. It also includes forward-looking guidance and commentary from a WSJ Tech Live conference.

IBM expects the dollar increase in revenue from the third quarter to the fourth quarter of 2020 to be in line with historical averages.

The company anticipates that the percentage increase in operating (non-GAAP) earnings per share from Q3 to Q4 2020 will be consistent with or slightly ahead of the historical average, notwithstanding a significant $2.3 billion charge for structural actions planned for the fourth quarter.

In the medium term, after completing the separation of its managed infrastructure services business, IBM expects to deliver sustainable mid-single-digit revenue growth. They aim to show improving revenue growth by mid-2021.