IBM tops third-quarter estimates and lifts guidance, but stock drops

Core Insights - IBM reported third-quarter results that exceeded Wall Street estimates, driven by ongoing artificial intelligence tailwinds, but the stock dropped 5% in extended trading [1] - The company raised its revenue guidance, now expecting more than 5% revenue growth, and projected free cash flow for the year to reach $14 billion [2] Financial Performance - Revenue increased by 9% to approximately $16.33 billion compared to about $15 billion in the same period last year [1][5] - Net income was reported at $1.74 billion, or $1.84 per share, a significant recovery from a loss of $330 million, or 36 cents per share, a year earlier [1] - Earnings per share were adjusted to $2.65, surpassing the expected $2.45 [5] Business Segments - IBM's AI book of business has grown to over $9.5 billion, up from $7.5 billion in the previous quarter [3] - Software revenue rose by 10% to $7.21 billion, meeting market estimates, while consulting revenue totaled $5.3 billion, exceeding projections [3] - Infrastructure revenue, which includes mainframe computers, increased by 17% to $3.6 billion [4] Dividends - The board approved a quarterly dividend of $1.68 per share [4]