The SME sector has proved lucrative for two industry stalwarts, with improved profits for both IBM and software vendor Sage.
IBM posted turnover of $21.5bn for its third quarter ended 30 September, an increase of four per cent on the same period last year.
Big Blue reported profit of $1.52bn for Q3, this is down from the $1.55bn the firm reported as profit for Q3 2004.
Sam Palmisano, chief executive at IBM, said: “IBM had a good quarter, showing the strength of our business model across hardware, software and services.”
Mark Loughridge, chief financial officer of IBM, said the SME segment was the strongest in Q3, with 10 per cent growth over the same time last year. He attributed this to the vendor’s “Express offerings and strong network of Business Partners and ISVs”.
Big Blue’s Global Services division grew by three per cent to $11.7bn, software turnover grew by five per cent to $3.8bn and hardware turnover grew by seven per cent to $5.1bn.
Ian Wesley, IBM research director at Ovum, said: “IBM can be pleased with these results, but it’s a sign of the times that four per cent growth is considered encouraging.”
Financial software vendor Sage announced a 13 per cent increase in pre-tax turnover to £777m, in line with market expectations for its year ended 30 September.
David Bradshaw, principal analyst at Ovum said: “These are good results in a very mixed market. The only complaint is that Sage merely met, rather than exceeded, market expectations.”
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