IBM first-quarter earnings disappoint

IBM Corp, the world's largest technology services company, reported an increase in first-quarter earnings, but missed estimates due to the depreciation of the Japanese yen.

International Business Machines Corp said on Thursday its quarterly non-GAAP income rose 3 percent to US$3.4 billion, or US$3.00, compared with analyst estimates of US$3.05 a share, according to Thomson Reuters I/B/E/S.

The deterioration in Yen currency since mid-January reduced EPS by US$0.07, a spokesman said.

Quarterly revenue dropped 5 percent to US$23.4 billion compared with estimates of US$24.6 billion. Revenues fell 3 percent adjusted for currency.

Some analysts were unhappy with the results and IBM shares lost 3.1 percent from a closing price of $207.15 in extended trading following results.

"It's disappointing results," said ISI group analyst Brian Marshall.

"Clearly the business model is somewhat over-optimised. It's the first quarter in many years they did not grow EPS double digits year-over-year."

He added investors were very focused on that double-digit earnings growth.

(Reporting by Nicola Leske.; Additional reporting by Jennifer Saba. Editing by Andre Grenon)