Stock Analysis on Net
Stock Analysis on Net

International Business Machines Corp. (NYSE:IBM)

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Common-Size Income Statement
Quarterly Data

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International Business Machines Corp., common-size consolidated income statement (quarterly data)

Microsoft Excel
3 months ended: Sep 30, 2025 Jun 30, 2025 Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Services
Sales
Financing
Revenue
Services
Sales
Financing
Cost
Gross profit
Selling, general and administrative
Research and development
Intellectual property and custom development income
Operating income
Other income and (expense)
Interest expense
Income (loss) from continuing operations before income taxes
(Provision for) benefit from income taxes
Income (loss) from continuing operations
Income (loss) from discontinued operations, net of tax
Net income (loss)

Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).

Revenue Composition
The revenue structure reveals a fluctuating contribution from services and sales segments over the analyzed periods. Services as a percentage of revenue generally decline from above 60% initially to the low-to-mid 40% range in later quarters, showing a gradual reduction in their revenue share. In contrast, sales exhibit an opposing trend, increasing from around 33% to over 50% towards the end, indicating a shift in the revenue mix favoring sales activities. Financing remains a relatively minor and stable contributor, oscillating slightly just above 1% of total revenue.
Cost Trends
Costs as a percentage of revenue demonstrate a downward trend, reducing from approximately 55% to close to 41-43%. This indicates improved cost efficiency or favorable cost management as gross profit margins increase accordingly. Cost reductions are consistent across several quarters, aiding overall profitability gains.
Profitability Metrics
Gross profit margin shows an upward trend, rising from close to 45% to near 58% in the later quarters, reflecting successful margin expansion. Operating income as a percentage of revenue also improves significantly, fluctuating but generally increasing from low single digits to above 20% in several periods. This signals effective control over operating expenses relative to revenues.
Operating Expenses
Selling, general and administrative expenses (SG&A) relative to revenue show some volatility but tend to decrease over time, dropping from around 34% to under 30% towards recent periods. Research and development (R&D) expenses remain relatively stable but exhibit a modest rising tendency, mostly fluctuating between 9% and 13%, indicating ongoing investment in innovation despite margin improvements.
Other Income and Interest Expense
Other income and expense contributions to revenue are inconsistent, with a few notable outliers including a sharp dip in one quarter. Interest expense remains relatively stable around the 2-3% range without significant upward or downward movement, suggesting steady financing costs.
Income Before Taxes and Tax Provision
Income from continuing operations before income taxes consistently increases over time, although with some quarters showing negative or reduced values, reflecting volatility. Tax provisions show negative and positive swings, which impact net income variably, but overall the effective tax rate appears to fluctuate widely by quarter.
Net Income Trends
Net income as a percentage of revenue generally improves over the reported periods, rising from under 7% up to beyond 16% and even higher in some quarters, despite interim volatility and occasional negative spikes. Income from discontinued operations is negligible and does not materially affect net income trends.
Summary
The company displays a clear strategic shift in revenue composition towards sales, coupled with enhanced cost management leading to improved gross and operating margins. Operating expenses, while variable, are generally well-controlled, and R&D investment remains steady, supporting innovation. Profitability metrics such as operating income and net income as a percentage of revenue show noteworthy improvement, albeit with some volatility reflecting market or operational challenges. Overall, the data suggests strengthening financial performance with improved efficiency and profitability over the periods analyzed.