IBM: Fiscal 4Q13 Financial Results

IBM Corp. reports 2013 fourth-quarter and full-year results ended December 31 2013.

Revenue from system storage decreased 13% or 12% at constant currency.

It represents 22% of the total Systems and Technology sales or only $946 million.

Flash solutions continue to gain momentum and contributed a few points of growth during the quarter. Storwize product again delivered double-digit growth, which was offset by declines in legacy OEM midrange offerings. IBM also had declines in the high-end, driven by significant pricing pressure.

Storage is a nightmare for Big Blue since at least two years with revenue decreasing yearly each quarter since 4Q11 (see below) with the worst result registered (-13%) for the last three-month period.

Historically, when an activity has poor results since a long time, IBM finally sells it. To which company?

Lenovo was rumored to buy IBM server and storage business and just announced it plans to acquire IBM’s x86 server segment for $2.3 billion, IBM retaining its storage systems. But the two companies also announced that they enter into a relationship which will include a global OEM and reseller agreement for sales of notably IBM’s entry and midrange Storwize disk storage systems, tape storage systems, and General Parallel File System software.

Others rumors of potential acquirer concerned competitors Dell and Fujitsu.

It will be a huge announcement if IBM definitively get out of the storage industry where it entered in 1952 with the IBM 701 computer and the magnetic tape drive vacuum column, followed by the first magnetic HDD in 1956. Remember that Big Blue already sold its disk drive business to Hitachi in 2002 for $2,050 billion and being now part of WD.

IBM System Storage Revenue