IBM has posted record profits of $5.3bn (£3.3bn) for the fourth quarter of 2010 after an increase in outsourcing contracts and sales of mainframes and middleware.
The US-based company said its profits were up 9% in Q4 compared with the same period in 2009, with record sales reaching $29bn (£18bn) in the quarter, up 7% on 2009 figures.
Compared with a year ago, outsourcing contracts rose 24% and System Z mainframe sales increased by 69%. Sales of IBM's middleware WebSphere product increased 32% year-on-year.
"We completed an outstanding year, with record profit and free cash flow, and exceeded the high end of our 2010 earnings per share roadmap objective," said Samuel Palmisano, IBM's chief executive.
Palmisano said IBM's acquisition of 116 companies helped to triple the company's earnings per share (EPS) and return $100bn (£62.5bn) to shareholders in 2010.
"As IBM enters its second century, we will continue to focus on our long-term strategic initiatives in growth markets, smarter planet solutions, cloud and business analytics, as we drive to achieve our new roadmap target of operating EPS of at least $20 in 2015," he said.