IBM grows software business thanks to analytics and WebSphere

IBM has announced first-quarter net income of $2.9bn compared with $2.6bn in the first quarter of 2010, an increase of 10%.

IBM has announced first-quarter net income of $2.9bn compared with $2.6bn in the first quarter of 2010, an increase of 10%.

The software business at IBM saw a 16% increase in revenue. Revenues from IBM's key middleware products, which include WebSphere, Information Management, Tivoli, Lotus and Rational products, were $3.3bn and revenues from the WebSphere family of software products increased 51% year over year, while Information Management software revenues increased 13%.

Total Global Services revenues increased 6%, while hardware revenue was $4bn for the quarter, up 19%.

Samuel J Palmisano (pictured), IBM chairman, president and chief executive officer, said: "We delivered a strong first quarter with revenue growth across hardware, software and services and with more than 40 countries growing in double digits. We continued to see excellent momentum in our growth initiatives - smarter planet, cloud, business analytics, and growth markets - which bring together the full value of the IBM portfolio. We achieved broad-based margin improvement, while our cash flow and strong financial position enabled us to continue to return value to our shareholders.

IBM has also reported growth in its cloud and business intelligence businesses. Car maker Audi is one of the companies using IBM's cloud, to run its SAP installation in a private cloud.

According to Gartner, IBM was the fourth largest supplier of BI software, behind SAS, Oracle and SAP. Dan Sommer, principal research analyst at Gartner, said, "BI spending has far surpassed IT budget growth overall for several years, and it is clear that BI continues to be a technology at the centre of information-driven initiatives in organisations."

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