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SEGMENT INFORMATION (Tables)
 12 Months Ended
Dec. 31, 2016
SEGMENT INFORMATION  
Revenue and Pre-tax Income by Segment

 

Management System Segment View

 

($ in millions)

 

 

 

Cognitive Solutions & Industry Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Technology

 

 

 

 

 

 

 

 

 

 

 

Global

 

Services &

 

 

 

 

 

 

 

 

 

Cognitive

 

Business

 

Cloud

 

 

 

Global

 

Total

 

For the year ended December 31:

 

Solutions

 

Services

 

Platforms

 

Systems

 

Financing

 

Segments

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$
18,187 

 

$
16,700 

 

$
35,337 

 

$
7,714 

 

$
1,692 

 

$
79,630 

 

Internal revenue

 
2,630 

 
409 

 
715 

 
750 

 
1,802 

 
6,307 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$
20,817 

 

$
17,109 

 

$
36,052 

 

$
8,464 

 

$
3,494 

 

$
85,936 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax income from continuing operations

 

$
6,352 

 

$
1,732 

 

$
4,707 

 

$
933 

 

$
1,656 

 

$
15,380 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue year-to-year change

 
3.8 

%
(3.1 

)%
0.6 

%
(18.0 

)%
(22.0 

)%
(2.7 

)%

Pre-tax income year-to-year change

 
(12.3 

)%
(33.4 

)%
(17.0 

)%
(45.8 

)%
(29.9 

)%
(21.5 

)%

Pre-tax income margin

 
30.5 

%
10.1 

%
13.1 

%
11.0 

%
47.4 

%
17.9 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$
17,841 

 

$
17,166 

 

$
35,142 

 

$
9,547 

 

$
1,840 

 

$
81,535 

 

Internal revenue

 
2,215 

 
499 

 
698 

 
778 

 
2,637 

 
6,826 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$
20,055 

 

$
17,664 

 

$
35,840 

 

$
10,325 

 

$
4,477 

 

$
88,361 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax income from continuing operations

 

$
7,245 

 

$
2,602 

 

$
5,669 

 

$
1,722 

 

$
2,364 

 

$
19,602 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue year-to-year change

 
(8.4 

)%
(11.9 

)%
(9.8 

)%
(22.4 

)%
(1.0 

)%
(11.2 

)%

Pre-tax income year-to-year change

 
(11.8 

)%
(22.3 

)%
(20.0 

)%
24.4 

%
8.0 

%
(11.8 

)%

Pre-tax income margin

 
36.1 

%
14.7 

%
15.8 

%
16.7 

%
52.8 

%
22.2 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2014

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$
19,689 

 

$
19,512 

 

$
38,889 

 

$
12,294 

 

$
2,034 

 

$
92,418 

 

Internal revenue

 
2,216 

 
543 

 
840 

 
1,006 

 
2,488 

 
7,093 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$
21,906 

 

$
20,055 

 

$
39,729 

 

$
13,300 

 

$
4,522 

 

$
99,512 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax income from continuing operations

 

$
8,215 

 

$
3,347 

 

$
7,084 

 

$
1,384 

 

$
2,189 

 

$
22,219 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue year-to-year change

 
(0.1 

)%
(8.5 

)%
(0.9 

)%
(19.8 

)%
5.1 

%
(5.1 

)%

Pre-tax income year-to-year change

 
(5.2 

)%
(2.9 

)%
(7.3 

)%
(21.5 

)%
0.8 

%
(6.2 

)%

Pre-tax income margin

 
37.5 

%
16.7 

%
17.8 

%
10.4 

%
48.4 

%
22.3 

%

 

Reconciliation of segment revenue to IBM as reported

 

($ in millions)

 

For the year ended
December 31:

 

2016

 

2015

 

2014

 

Revenue

 

 

 

 

 

 

 

Total reportable segments

 

$
85,936

 

$
88,361

 

$
99,512

 

Other revenue

 
289

 
206

 
374

 

Elimination of internal transactions

 
(6,307

)
(6,826

)
(7,093

)

 

 

 

 

 

 

 

 

Total IBM consolidated revenue

 

$
79,919

 

$
81,741

 

$
92,793

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of segment pre-tax income to IBM as reported

 

($ in millions)

 

For the year ended
December 31:

 

2016

 

2015**

 

2014**

 

Pre-tax income from continuing operations:

 

 

 

 

 

 

 

Total reportable segments

 

$
15,380

 

$
19,602

 

$
22,219

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of acquired intangible assets

 
(998

)
(677

)
(791

)

Acquisition-related charges

 
(5

)
(26

)
(12

)

Non-operating retirement- related (costs)/income

 
(598

)
(1,050

)
(353

)

Elimination of internal transactions

 
(1,160

)
(1,675

)
(1,746

)

Unallocated corporate amounts*

 
(290

)
(230

)
688

 

 

 

 

 

 

 

 

 

Total pre-tax income from continuing operations

 

$
12,330

 

$
15,945

 

$
19,986

 

 

 

 

 

 

 

 

 

 

 

 

 

*The 2014 amount includes the gain related to the Retail Store Solutions divestiture and the net gain related to the System x business divestiture.

 

**Reclassified to conform to 2016 presentation.

 

Assets and Other Items by segment

 

Management System Segment View

 

($ in millions)

 

 

 

Cognitive Solutions &

 

 

 

 

 

 

 

 

 

 

 

Industry Services

 

Technology

 

 

 

 

 

 

 

 

 

 

 

Global

 

Services &

 

 

 

 

 

 

 

 

 

Cognitive

 

Business

 

Cloud

 

 

 

Global

 

Total

 

For the year ended December 31:

 

Solutions

 

Services

 

Platforms

 

Systems

 

Financing

 

Segments

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

$
25,517 

 

$
8,628 

 

$
24,085 

 

$
3,812 

 

$
36,492 

 

$
98,534 

 

Depreciation/amortization of intangibles*

 
1,228 

 
104 

 
2,224 

 
375 

 
317 

 
4,248 

 

Capital expenditures/investments in intangibles

 
495 

 
55 

 
2,382 

 
453 

 
380 

 
3,764 

 

Interest income

 

—

 

—

 

—

 

—

 
1,547 

 
1,547 

 

Interest expense

 

—

 

—

 

—

 

—

 
371 

 
371 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

$
20,017 

 

$
8,327 

 

$
23,530 

 

$
3,967 

 

$
36,157 

 

$
91,999 

 

Depreciation/amortization of intangibles*

 
921 

 
81 

 
1,944 

 
321 

 
343 

 
3,610 

 

Capital expenditures/investments in intangibles

 
448 

 
86 

 
2,619 

 
321 

 
356 

 
3,830 

 

Interest income

 

—

 

—

 

—

 

—

 
1,720 

 
1,720 

 

Interest expense

 

—

 

—

 

—

 

—

 
469 

 
469 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2014

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

$
19,525 

 

$
8,831 

 

$
22,512 

 

$
4,219 

 

$
38,845 

 

$
93,933 

 

Depreciation/amortization of intangibles*

 
1,040 

 
98 

 
1,982 

 
734 

 
455 

 
4,308 

 

Capital expenditures/investments in intangibles

 
413 

 
79 

 
2,321 

 
627 

 
482 

 
3,921 

 

Interest income

 

—

 

—

 

—

 

—

 
1,951 

 
1,951 

 

Interest expense

 

—

 

—

 

—

 

—

 
518 

 
518 

 

 

*

Segment pre-tax income from continuing operations does not include the amortization of intangible assets.

 

Reconciliation of assets to IBM as reported

 

($ in millions)

 

At December 31:

 

2016

 

2015

 

2014

 

Assets

 

 

 

 

 

 

 

Total reportable segments

 

$
98,534

 

$
91,999

 

$
93,933

 

 

 

 

 

 

 

 

 

 

 

 

Elimination of internal transactions

 
(5,670

)
(4,709

)
(5,193

)

Unallocated amounts

 

 

 

 

 

 

 

Cash and marketable securities

 
6,752

 
6,634

 
7,182

 

Notes and accounts receivable

 
2,660

 
2,333

 
4,253

 

Deferred tax assets

 
5,078

 
4,693

 
6,465

 

Plant, other property and equipment

 
2,656

 
2,650

 
2,169

 

Pension assets

 
3,034

 
1,734

 
2,160

 

Other

 
4,425

 
5,161

 
6,303

 

 

 

 

 

 

 

 

 

Total IBM consolidated assets

 

$
117,470

 

$
110,495

 

$
117,271

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Information

Revenue*

 

($ in millions)

 

For the year ended

 

 

 

 

 

 

 

December 31:

 

2016

 

2015

 

2014

 

United States

 

$
30,194 

 

$
30,514 

 

$
32,021 

 

Japan

 
8,339 

 
7,544 

 
8,382 

 

Other countries

 
41,386 

 
43,683 

 
52,390 

 

 

 

 

 

 

 

 

 

Total IBM consolidated revenue

 

$
79,919 

 

$
81,741 

 

$
92,793 

 

 

 

 

 

 

 

 

 

 

 

 

 

*

Revenues are attributed to countries based on the location of the client.

 

Plant and Other Property—Net

 

($ in millions)

 

At December 31:

 

2016

 

2015

 

2014

 

United States

 

$
4,701 

 

$
4,644 

 

$
4,388 

 

Other countries

 
5,607 

 
5,532 

 
5,690 

 

 

 

 

 

 

 

 

 

Total

 

$
10,308 

 

$
10,176 

 

$
10,078 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue by Classes of Similar Products or Services

 

($ in millions)

 

For the year ended

 

 

 

 

 

 

 

December 31:

 

2016

 

2015

 

2014

 

Cognitive Solutions

 

 

 

 

 

 

 

Software

 

$
13,969 

 

$
14,557 

 

$
16,502 

 

Services

 
4,111 

 
3,175 

 
3,143 

 

Systems

 
107 

 
108 

 
44 

 

Global Business Services

 

 

 

 

 

 

 

Services

 

$
16,399 

 

$
16,851 

 

$
19,202 

 

Software

 
179 

 
164 

 
186 

 

Systems

 
121 

 
151 

 
124 

 

Technology Services &

 

 

 

 

 

 

 

Cloud Platforms

 

 

 

 

 

 

 

Services

 

$
24,311 

 

$
23,947 

 

$
26,462 

 

Maintenance

 
5,862 

 
6,085 

 
6,790 

 

Software

 
3,818 

 
3,907 

 
4,332 

 

Systems

 
1,346 

 
1,203 

 
1,304 

 

Systems

 

 

 

 

 

 

 

Servers

 

$
3,567 

 

$
5,032 

 

$
7,177 

 

Storage

 
2,083 

 
2,325 

 
2,641 

 

Software

 
1,586 

 
1,749 

 
2,053 

 

Services

 
478 

 
442 

 
423 

 

Global Financing

 

 

 

 

 

 

 

Financing

 

$
1,231 

 

$
1,386 

 

$
1,543 

 

Used equipment sales

 
461 

 
454 

 
491