IBM net up 4.4%; outlook for 2012 above target : Report

NEW YORK (MarketWatch)
International Business Machines Corp.’s fourth-quarter earnings rose 4.4% as higher software and services revenue offset a decline in its hardware business
Shares of IBM were up 2.8% to $185.50 in recent after-hours trading as the company projected 2012 earnings above expectations
The stock rose 25% in 2011, reaching new highs in December
Through the close, the stock has pulled back 1.8% in January
For the new year, Big Blue projected per-share earnings of at least $14.85, above recent estimates of analysts polled by Thomson Reuters expecting $14.82
The Armonk, N.Y., company has benefited from its push toward higher-margin, complex businesses such as business analytics, as well as investments in emerging markets
Though the strategy has been paying off, recent economic uncertainty has increased concerns about technology spending by corporations and governments
IBM reported a profit of $5.49 billion, or $4.62 a share, up from $5.26 billion, or $4.18 a share, a year earlier
Operating earnings, which exclude retirement-plan costs and amortization, rose to $4.71 a share from $4.25 a share
Revenue increased 1.6% to $29.5 billion — or 1% including currency fluctuations
Analysts recently projected earnings of $4.62 on revenue of $29.71 billion
Gross margin rose to 49.9% from 49%
In the latest results, IBM’s systems-and-technology unit reported an 8% decline in revenue
The unit, which includes its hardware business, has been an engine for revenue growth in recent quarters but though the growth has been slowing in recent quarters
However, software segment revenue was up 9% as most of its key products saw growth
Technology services and business services revenue also improved, both rising 3%
In the company’s growth markets — which include Brazil, Russia, India and China — revenue grew 7%, or 8% adjusted for foreign exchange
Meanwhile, revenue in the Americas improved 3%
Total sales in Europe, the Middle East and Africa rose 1%, while total revenue in Asia increased 2%, but excluding currency impacts declined 1%