IBM senior executives sacrifice bonus as revenue drops

Desktops

by CBR Staff Writer| 22 January 2014

The announcement follows reports of 5% decrease in IBM's quarterly revenue.

IBM's chief executive Ginni Rometty and senior executives have announced that they will sacrifice their bonuses for 2013 as revenue has dropped.

The announcement follows reports of a 5% year-over-year decrease in the company's revenue during the fourth quarter and 1% decline in net profit for 2013.

The decrease in revenue was attributed to the 26% year-over-year decline in the company's hardware revenue that dropped to $4.3b for the quarter.

IBM chairman, president and chief executive officer Ginni Rometty said the company continued to drive strong results across much of its portfolio and grew earnings per share in 2013.

"While we made solid progress in businesses that are powering our future, in view of the company's overall full year results, my senior team and I have recommended that we forgo our personal annual incentive payments for 2013," Rometty added.

"As we enter 2014, we will continue to transform our business and invest aggressively in the areas that will drive growth and higher value."

The investments in growing segments are part of the company's strategy for operating EPS of about $20 by 2015 that is expected to help it in strengthening its position.

During the fourth quarter of 2013, the company reported a 3% increase in revenues from the software segment to $8.1bn compared to the same period previous year.

IBM's Global Technology Services segment revenues went down by 4% year-over-year to $9.9bn from the fourth quarter of 2012, while the Global Business Services segment registered a 1% rise to $4.7bn.

Regionally, the fourth-quarter revenues in US declined by 3%, while Europe/Middle East/Africa revenues grew 1% for the period, whereas in the Asia-Pacific region the revenues decreased by 16% to $5.9bn.

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