FMP
IBM Stock Drops 8% on Q1 Revenue Miss, Announces a $6.4 Billion Acquisition of HashiCorp
Apr 25, 2024 10:57 AM - Davit Kirakosyan
Image credit: FMP
IBM (NYSE:IBM) outperformed earnings forecasts for the first quarter of 2024 but fell short on revenue, and concurrently, announced its acquisition of HashiCorp (NASDAQ:HCP) for $6.4 billion. The news led to a more than 8% drop in IBM’s stock in pre-market today.
The company reported an earnings per share (EPS) of $1.68, surpassing the predicted $1.58. However, its quarterly revenue of $14.46 billion slightly missed the expected $14.51 billion, with consulting revenue also slightly below forecasts at $5.19 billion compared to the anticipated $5.2 billion.
Looking ahead, IBM projects constant currency revenue growth consistent with its mid-single-digit growth model for the entire year of 2024. The company did warn, though, that currency fluctuations might reduce revenue growth by about 1.5 to 2 percentage points. IBM reaffirmed its expectation to generate around $12 billion in free cash flow for the year.
Additionally, IBM disclosed that it has finalized a deal to acquire HashiCorp., a key player in multi-cloud infrastructure automation, at $35 per share in cash. The purchase, with a net enterprise value of $6.4 billion after considering HashiCorp's cash reserves, will be financed using IBM’s existing cash resources.
Other Blogs
Sep 11, 2023 1:38 PM - Rajnish Katharotiya
P/E Ratios Using Normalized Earnings
Price to Earnings is one of the key metrics use to value companies using multiples. The P/E ratio and other multiples are relative valuation metrics and they cannot be looked at in isolation. One of the problems with the P/E metric is the fact that if we are in the peak of a business cycle, earni...
Sep 11, 2023 1:49 PM - Rajnish Katharotiya
What is Price To Earnings Ratio and How to Calculate it using Python
Price-to-Earnings ratio is a relative valuation tool. It is used by investors to find great companies at low prices. In this post, we will build a Python script to calculate Price Earnings Ratio for comparable companies. Photo by Skitterphoto on Pexels Price Earnings Ratio and Comparable Compa...
Oct 17, 2023 3:09 PM - Davit Kirakosyan
VMware Stock Drops 12% as China May Hold Up the Broadcom Acquisition
Shares of VMware (NYSE:VMW) witnessed a sharp drop of 12% intra-day today due to rising concerns about China's review of the company's significant sale deal to Broadcom. Consequently, Broadcom's shares also saw a dip of around 4%. Even though there aren’t any apparent problems with the proposed solu...
