IBM's Earnings Could Be Good News For EMC

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In a report published Tuesday, JPMorgan analyst Rod Hall maintained that the constant currency revenue reported by
International Business Machines CorpIBM
was flat y/y, which bodes well for "our other large enterprise tech names." IBM reported revenues of $19.59bn, in-line with consensus and flat y/y adjusted for currency effects and divested businesses. Total systems revenue was up 30 percent y/y on an adjusted basis to $1.66bn, with a 130 percent y/y surge in System Z mainframe revenues. IBM reported a decline of merely 2 percent y/y in its Storage revenues on an adjusted basis, better than the 5 percent decline reported in 4Q14 and the 6 percent decline recorded in 3Q14. "We see the flat Y/Y constant currency revenue as a relatively positive read for our other large enterprise tech names [which includes
EMC CorporationEMC
] in terms of underlying demand trends. We are somewhat cautious on storage heading into earnings but the slower decline is counter to that view and could result in better than expected EMC earnings this week," Hall wrote.
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Posted In: Analyst ColorAnalyst RatingsJPMorganRod Hall
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