IBM Provides Historical Data in Preparation for Reporting Changes

Alleen voor leden beschikbaar, wordt daarom gratis lid!

Overig advies 01/01/2022 11:28
This article is the last in a series IBM is posting to help investors understand its historical profile and reporting implications following the separation of Kyndryl. The purpose of this article is to provide stakeholders with a view of its historical financials which reflect both the separation of Kyndryl as well as the changes to IBM’s management structure and segment reporting. Investors and analysts now have the information needed to:

Update fourth quarter 2021 revenue and operating (non-GAAP) earnings per share estimates ahead of IBM’s fourth quarter earnings report in January.
Recast historical models to reflect continuing operations and the new segments revenue and gross profit details.

As a result of the separation, Kyndryl’s historical operational activity has been reclassified to IBM’s discontinued operations results, in accordance with the requirements of U.S. Generally Accepted Accounting Principles (GAAP). As such, IBM is now providing recast historical results on a continuing operations and discontinued operations basis. IBM’s future reporting will focus on continuing operations and the company will continue to provide an operating (non-GAAP) view of its results.

As a reminder, discontinued operations do not include historical intercompany transactions between IBM and Kyndryl (e.g., purchases of IBM hardware and software) which were previously eliminated in consolidation. It also does not include the spending for shared services (e.g., finance, marketing, human resources, global sales coverage) that was transferred to Kyndryl upon separation. Therefore, IBM’s historical recast of continuing operations, in total and at the segment level, through October 2021 does not represent its go-forward continuing operations profile.

To provide additional transparency to investors, IBM previously provided a baseline of its 2020 post-separation revenue, operating (non-GAAP) net income, and free cash flow, which it believes is a more representative view of its go-forward business. This view is re-attached below and has not changed from when it was published on November 4 (see Exhibit 1).

o understand the expected impact to IBM’s fourth quarter 2021 financial results, investors should familiarize themselves with the content provided in October and November of this year.

During its third quarter earnings webcast on October 20, IBM discussed the estimated impact of the Kyndryl separation (effective November 3) on its November and December consolidated results, net of the new commercial relationship: ~$3 billion revenue, $0.20-$0.25 earnings per share (Step 1).
The November 29 investor article gave investors additional information on its fourth quarter 2021 discontinued operations, including an estimate of the impact discontinued operations would have on its 4Q21 continuing operations operating (non-GAAP) results: ~$1.5 billion revenue, ~$0.25 operating (non-GAAP) earnings per share (Step 2). This discontinued operations estimate excludes spin-related transaction charges and potential Kyndryl-related, one-time non-cash items.

see &

Beperkte weergave !
Leden hebben toegang tot meer informatie! Omdat u nog geen lid bent of niet staat ingelogd, ziet u nu een beperktere pagina. Wordt daarom GRATIS Lid of login met uw wachtwoord

Copyrights © 2000 by all rights reserved
Niets mag zonder toestemming van de redactie worden gekopieerd, linken naar deze pagina is wel toegestaan.