IBM’s 2024 Q4 earnings exceeded Wall Street expectations.

Revenue for the quarter came in at $17.6 billion, up one percent, bringing the year’s revenue to $62.8bn overall. The company reported earnings of $3.92 a share compared to Wall Street’s consensus estimate of $3.78 a share.

IBM’s software revenue was up 10 percent, with Red Hat up 16 percent. Automation jumped 15 percent, with Data & AI and Security both up by four percent.

Consulting revenue decreased by two percent, and infrastructure revenue was down by eight percent.

Big Blue’s Q3 results showed a similar trend with IBM’s consulting and infrastructure businesses failing to grow.

“Clients globally continue to turn to IBM to transform with AI. Our generative AI book of business now stands at more than $5 billion inception-to-date, up nearly $2 billion quarter over quarter," said Arvind Krishna, IBM chairman, president, and CEO.

The company’s AI book of business is IBM’s combination of bookings and actual sales across a variety of products.

Krishna added the company is "well-positioned for 2025 and beyond and expect[s] revenue growth of at least five percent and free cash flow of about $13.5 billion this year."

IBM has ended the fourth quarter with $14.8bn in cash, restricted cash, and marketable securities, up by $1.3 billion from year-end 2023. Debt, including IBM financing debt of $12.1 billion, totaled $55 billion, down by $1.6 billion since year-end 2023.

IBM stock has risen by 22 percent over the past year, with shares rising by nine percent on the morning following the earnings announcement.