IBM Storage Earnings Up

ARMONK, N.Y. -- IBM (NYSE: IBM) today announced second-quarter 2007 diluted earnings of $1.55 per share from continuing operations, including 5 cents per share for a pre-tax gain of $81 million relating to the sale of the Printing Systems Division (PSD), an increase of 19 percent as reported, compared with diluted earnings of $1.30 per share in the second quarter of 2006. Diluted earnings for the second-quarter 2007 were $1.50 per share, excluding this gain, an increase of 15 percent year over year.

Second-quarter income from continuing operations was $2.3 billion, including the gain from the sale of PSD, compared with $2.0 billion in the second quarter of 2006, an increase of 12 percent. Without the gain, income from continuing operations of $2.2 billion in the second quarter of 2007 increased $167 million, or 8 percent versus the comparable period last year. Total revenues for the second quarter of 2007 of $23.8 billion increased 9 percent (6 percent, adjusting for currency) from the second quarter of 2006.

"This quarter's strong revenue growth --- our best since 2001 --- underscores IBM's global capabilities, as well as the higher value that clients place on our expanding software product line and wide range of services offerings that are helping them transform their businesses," said Samuel J. Palmisano, IBM chairman, president and chief executive officer. "Our overall results again demonstrate the strength of our business model and our ability to achieve profitable growth and strong cash generation. Earlier this year we described to our investors IBM's objective for earnings per share growth through 2010. While this is a long-term goal, our first-half results represent solid progress on major elements of this roadmap, including earnings growth, margin expansion, and revenue growth in key areas: emerging markets, acquisitions and service oriented architecture opportunities."

IBM Corp.