To reach its target for 2023, the company must
now generate $5.4 billion in free cash flow in
the fourth quarter, more than what it has
picked up for the first nine months of this year.
The most important point in the article. There is no chance of meeting this projection. We know what that means. . .
https://www.cnbc.com/2023/10/25/ibm-q3-earnings-report-2023.html
fake , another financial engineering
@6xrw You have hit the nail on the head. IBM’s legacy is big iron (B to B) and they could never adjust to become a consumer facing business (B to C). Just look at all of their tries PC’s = gone, Intel servers = gone, SMB power/storage = partnered out and shrinking, printers = gone, checkout = gone, copiers = gone, etc etc What remains? Enterprise offerings. So what’s become of those SMB and customer oriented offerings? IBM in shedding them, ALSO licensed their IP as IBM embedded piles of innovation into those offerings. IBM realized it was a better model to gets 70% of their profit via IP, without all of the added costs and expenses of doing (B to C) It’s a win/win, and it’s the road IBM is now traveling. IBM will gradually shrink all of their B to C offerings to exclusive IP profit models (essentially modeling DuPonts go to market strategy) as the overhead is greatly reduced and concentrate on Enterprise. Welcome to AK’s vision for a leaner IBM. I suspect IBM will shrink to a 200-210 k headcount company when all is said and done.
IBM occupies the same sort of position as Mack, Peterbilt and Kenworth...products intended for specific types of extremely heavy workloads. Many (but not all) people know the name, but most people will never buy IBM products either for themselves or for their workplaces. They simply do not have the workloads to justify the expense.
In other words, IBM has gone back to the future...a niche vendor of enterprise computing products. It "tried out" various lines of SMB- and consumer-oriented businesses, but it eventually shed those divisions and went back to what's in its blood...big-a-s enterprise hardware for customers with lots of cash and heavy-duty workloads.
Don't look for major advertising or major media influencer presence...IBM has chosen not to present itself in those venues anymore.
Actually it’s just IBM changing their public face to its hybrid enterprise cloud niche, and executing that plan. IBM isn’t all things to all companies anymore. It’s a hybrid enterprise cloud niche built around enterprise offerings. Like it or not, IBM’s finally shedding the business to consumer marketplace which includes almost all small and medium businesses offerings. Intel and their services models have filled that void as it’s viewed as “good enough” Redhat even if it hits all of their growth prospects isn’t hunting in this space anymore as IBM has transitioned them to Enterprise engagements
"Good news! The IBM naysayers are hiding in shame!" .... Actually I think it's very worrying. The usual many negative comments on this and other sites, along with the usual many negative news articles haven't been replaced with many positive comments or many positive news articles. It seems to be more a case that nobody cares anymore, nobody can be bothered to say anything about IBM, good or bad. It's just slowly fading away into the history books.
Yes IBM had a better Q than usual, but it wasn't that good when compared to competitors numbers. IBMs personal best isn't enough to win the race (or even a medal).
Good news! The IBM naysayers are hiding in shame!
a good software is designed together with hardware. If IBM becomes only a software company, it will be weak as anyone can write software.
Yesterday’s analyst call had a very important point embedded in it. Almost 900 million of the improved 2023 FCF came from “profit” as the business model has moved to SW and consulting. The other 300 million was due to restructuring efficiencies. That’s a really big fundamental change to the IBM business model. As such that makes the 4th Q FCF target within range. If IBM would address the poorly performing parts of “infrastructure”, yet another 1 billion would drop to the bottom line