IBM (NYSE:IBM) Corp on Tuesday reported a lower-than-expected quarterly revenue, as growth in its higher-margin businesses that include cloud and artificial intelligence services failed to make up for declines across legacy business segments.
IBM’s shares fell 3 percent to $149.15 in after-market trading.
Armonk, New York-based IBM has in recent years shifted focus to pockets of growth across its business — high-margin areas such as cloud, cybersecurity and data analytics — to counter a slowdown in its hardware and software businesses.
Revenue from these initiatives, which IBM calls “strategic imperatives,” rose 5 percent in the second quarter ended June 30.
However, some analysts have expressed concern that IBM’s aggressive investments in areas such as artificial intelligence offering Watson have done little to boost revenue overall.
By Pushkala A
U.S. spices maker McCormick & Co Inc (N:MKC) has agreed to buy Reckitt Benckiser Group’s (L:RB) food business for a higher-than-expected $4.2 billion to give it a wider variety of seasonings and sauces.
London-listed Reckitt said in April it was reviewing options for the unit, which includes French’s mustard and Frank’s RedHot sauce, to cut its debt following the $16.6 billion purchase of baby formula maker Mead Johnson. That acquisition added a new product line and boosted its business in developing markets and the United States.
Sweden’s Volvo (ST:VOLVb) said on Wednesday that a stretched supply chain and extra costs to meet strong demand for its trucks dented margins in the second quarter, even as it reported a rise in profits and order intake.
Shares in Volvo, which competes with Germany’s Daimler (DE:DAIGn) and Volkswagen (DE:VOWG_p), have risen nearly 40 percent this year on robust demand and better margins following a 10-billion-crown cost-cutting drive.
Adjusted operating profit rose to 8.54 billion Swedish crowns ($1.03 billion) from 6.13 billion, just pipping the 8.48 billion forecast of analysts polled by Reuters.
By Niklas Pollard and Johannes Hellstrom
The euro pulled back from its highest level since May 2016 against the U.S. dollar on Wednesday as market participants awaited the outcome of Thursday’s European Central Bank policy meeting.
EUR/USD slipped 0.19% to 1.1530 by 05.52 a.m. ET (09.52 a.m. GMT), still not far from Wednesday’s highs of 1.1582.
Anticipation has been building ahead of the meeting after ECB President Mario Draghi sent the euro higher with hawkish comments on the euro zone recovery in a speech in Sintra, Portugal late last month.
The remarks appeared to signal a shift towards tapering monetary stimulus, but Draghi also reiterated that any changes to the stimulus program will be “gradual” and “cautious.”