Dallas, Texas 04/03/2014 (FINANCIALSTRENDS) – International Business Machines Corp. (NYSE:IBM) has been having a few tough quarters in the recent past, during which time, it has seen its revenue model coming under severe stress due to its traditional customers gravitating towards a cloud based licensing model, even as competitors like Oracle and Microsoft have gained market share in the software segment.
The difficult path in front of International Business Machines Corp. (NYSE:IBM) gets borne out by a recent report by tech analyst firm Gartner, which through its research has pegged the once famed Big Blue Firm into the third spot, behind its one time smaller competitor Oracle which in past couple of years made significant gains in its share of the overall global software market.
The Gartner report which came out last week estimates that in 2013, for the first time in their competitive history, Oracle revenue from software overtook that of IBM. Oracle accounted for close to $29.6 billion of the total $407 billion software market globally last year, where as IBM had to settle for the third spot at $29.1 billion.
Similarly, tech upstart Sales Force.Com has jumped up two positions to 10th from previous 12th position in the rankings, as it has seen its year on year sales almost double. The gains in market share that is being accomplished by this software as a service pioneer is directly at the cost of entrenched players like International Business Machines Corp. (NYSE:IBM) who have struggled to change their go to market plan to incorporate cloud based subscription offerings.
To counter this downward trend, the company announced recently that it is investing close to $100 million into strengthening its other lines of businesses like its consulting division. The change in approach was borne out by the statement quoted below by Bridget van Kralingen who is a Senior Vice President at International Business Machines Corp. (NYSE:IBM). He has been quoted to have said that, “As our clients recalibrate what it means to engage with their customers or employees, we’re bringing them the full spectrum of world-class design and IBM Research, book-ended by strategy consulting and our strength in Big Data.”
This report is for information purposes only, and is neither a solicitation or recommendation to buy nor an offer to sell securities. Financials Trend is not-a-registered-investment-advisor. Financials Trend is not a broker-dealer. Information, opinions and analysis contained herein are based on sources believed to be reliable, but no representation, expressed or implied, is made as to its accuracy, completeness or correctness. The opinions contained herein reflect our current judgment and are subject to change without notice. Financials Trend accepts no liability for any losses arising from an investor's reliance on the use of this material. Financials Trend sometimes gets compensated up to one hundred and fifty thousand dollars per month for featuring particular stocks. See site disclaimer for complete compensation. Financials Trend and its affiliates or officers currently hold no shares of these stocks. Financials Trend and its affiliates or officers will purchase and sell shares of common stock of these stocks, in the open market at any time without notice. Financials Trend will not update its purchases and sales of these stocks in any future postings on Financials Trend's websites. Certain information included herein is forward-looking within the context of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning manufacturing, marketing, growth, and expansion. The words "may", "would," "will," "expect," "estimate," "anticipate," "believe," "intend," " project," and similar expressions and variations thereof are intended to identify for ward-looking statements. Such forward- looking information involves important risks and uncertainties that could affect actual results and cause them to differ materially from expectations expressed herein. *Financials Trend does not set price targets on securities. Never invest into a stock discussed on this web site or in this email alert unless you can afford to lose your entire investment.