IBM's Q1 Results Were Better, and Worse, Than They Seemed On the Surface

It would be easy to be confused by Monday's first-quarter report from International Business Machines (NYSE: IBM). Per-share earnings were up, sales were down, and somehow, profit margins actually improved at a time when they seemingly shouldn't have. The explanation? Some of the most touted numbers in the report didn't come with a much-needed footnote that would have made things much simpler to understand.

That's simultaneously good news and bad news for shareholders. Revenue didn't shrink solely because IBM couldn't find buyers for its products. Conversely, earnings weren't nearly as strong as they seemed, given the media's most-touted comparisons, because most of the media ignored the more relevant per-share profit benchmark.

The sales overview: IBM generated $17.57 billion worth of revenue during the three-month stretch ending in March, down from $18.18 billion in sales for the same quarter a year earlier. The figure was also shy of the top-line number between $17.6 billion and $17.7 billion analysts were modeling.

Source Fool.com