IBM’s quarterly revenue rises to $15.77 billion supported by AI

Technology company IBM beat quarterly revenue estimates on software strength and demand for artificial intelligence.

The American company exceeded analysts’ estimates for second-quarter revenues on Wednesday, benefiting from strong demand for its software and high spending related to artificial intelligence by customers looking to take advantage of the booming technology, which led its shares to rise by 5% in extended trading.

According to CNBC, the company achieved earnings per share of about $2.43, compared to expectations of about $2.20, according to LSEG.

The company reported revenues of $15.77 billion, compared to analysts’ average estimate of $15.62 billion, according to LSEG data.

IBM has focused on expanding its Watsonx platform that allows users to deploy chatbots or optimize AI software code, while making the Granite family of AI models open source to help deploy its AI services.

The company’s shares are up about 12% so far this year, as investors count on a rise in AI-facing stocks to deliver gains for IBM.

Retail sales in the software sector rose nearly 7% to $6.74 billion. About 75% of revenue was recurring, CFO James Cavanaugh told Reuters.

The company’s AI business book, a combination of bookings and physical sales across different products, grew to $2 billion, of which about $1 billion was added in the second quarter.

Cavanaugh said consulting made up 75% of the AI ​​book, with the rest coming from software.