- IBM (IBM, Financial) reported Q1 2025 revenue of $14.5 billion, up 1% year-over-year.
- Generative AI business grew by $1 billion, reaching a total of $6 billion.
- IBM invested $7.1 billion in acquisitions, including HashiCorp, and returned $1.5 billion to shareholders in dividends.
IBM (IBM) has announced strong first-quarter results for 2025, with revenues reaching $14.5 billion, marking a 1% increase from the previous year and a 2% increase when adjusted for constant currency. The company's software segment emerged as a significant growth driver, posting a 7% increase in revenue, or 9% when adjusted for constant currency, totaling $6.3 billion.
The generative AI business also saw substantial progress, expanding by $1 billion to reach a total of $6 billion for the quarter, indicating robust enterprise adoption of AI solutions.
Despite challenges in other areas, such as a 2% decline in consulting and a 6% drop in infrastructure revenue, IBM's overall gross profit margin improved by 170 basis points to 55.2%. This expansion is partly attributed to the strong performance of the software segment, which maintained a gross margin of 83.6%.
IBM showcased its financial strength by generating $4.4 billion in operating cash flow and $2.0 billion in free cash flow. The company continues to invest in its strategic initiatives, as evidenced by $7.1 billion spent on acquisitions, including the purchase of HashiCorp.
Looking ahead, IBM remains confident in its growth trajectory, maintaining its full-year guidance of at least 5% constant currency revenue growth and projecting approximately $13.5 billion in free cash flow.
