IBM: Fiscal 3Q13 Financial Results

Big Blue was historically a leader in storage, not anymore. Now the company is not really a champion in storage and is losing market shares. It has a large and complete line of storage with tape and disk subsystems – partly with the help of NetApp and LSI – but nothing very exciting. IBM has the advantage to also sell servers for complete solutions – like Hitachi, HP or Dell -, but EMC and NetApp, without any offering in computers, are doing much better

IBM’s revenue of storage systems declined each quarter since 4Q11 or about two years (see below).

Storage represents 20% of the total 3Q13 revenue of its total system and technology segment or around $640 million, down 11% from 2Q13.

In the earning call corresponding to this third quarter of 2013, Mark Loughridge, IBM’s CFO, said: “Storage hardware revenue was down 10% at constant currency. The decline was driven by the growth market. In the major market storage revenue was up. Our storage products again delivered double-digit growth and we also continued to grow our flash solution. These were offset by declines in our legacy OEM midrange offerings and softness in the high-end. Pure Systems continued to gain momentum. In the major markets we grew more than 30% sequentially. Globally we shipped over 2,000 systems in the third quarter with over 8,000 total shipments since announcement.”

Tivoli software was up 3% at constant currency, driven by storage growth of security solutions.

IBM System Storage Revenue