The following tables reflect the continuing operations results of the company’s segments consistent with the management and measurement system utilized within the company. Effective with the closing of the transaction in July, Red Hat is included in the Cloud & Cognitive Software segment. The “Other” segment includes the divested mortgage servicing and select software businesses. Performance measurement is based on operating pre-tax income from continuing operations. The segments represent components of the company for which separate financial information is available that is utilized on a regular basis by the chief operating decision maker (the chief executive officer) in determining how to allocate resources and evaluate performance. The tables reflect the segments recast for the prior-year period due to the company’s segment changes effective January 2019.

* Recast to conform to 2019 presentation.

Reconciliations to IBM as Reported:


(Dollars in millions)
For the three months ended September 30:	2019		2018
Revenue:
Total reportable segments	$	19,462	$	19,914	*
Other — divested businesses		48		432	*
Other revenue		59		62
Eliminations of internal transactions		(1,541)		(1,652)	*
Total consolidated revenue	$	18,028	$	18,756

Pre-tax income from continuing operations:
Total reportable segments	$	2,661	$	3,741	*
Amortization of acquired intangible assets		(473)		(207)
Acquisition-related (charges)/income		(255)		(2)
Non-operating retirement-related (costs)/income		(145)		(389)
Eliminations of internal transactions		(84)		(118)	*
Other — divested businesses		(25)		62	*
Unallocated corporate amounts		(157)		(91)
Total pre-tax income from continuing operations	$	1,522	$	2,996

* Recast to conform to 2019 presentation.

SEGMENT INFORMATION


	Cloud &			Global			Global
	Cognitive			Business			Technology						Global			Total
(Dollars in millions)	Software			Services			Services			Systems			Financing			Segments
For the nine months ended September 30, 2019:
External revenue	$	15,962		$	12,391		$	20,412		$	4,562		$	1,100		$	54,426
Internal revenue		2,135			213			879			528			884			4,638
Total revenue	$	18,097		$	12,604		$	21,291		$	5,091		$	1,983		$	59,065
Pre-tax income/(loss) from continuing operations	$	5,052		$	1,188		$	1,000		$	(101)		$	803		$	7,941
Revenue year-to-year change		0.2	%		0.2	%		(5.1)	%		(15.0)	%		(18.3)	%		(3.9)	%
Pre-tax income year-to-year change		(12.3)	%		11.7	%		(11.0)	%		(128.8)	%		(23.0)	%		(15.0)	%
Pre-tax income/(loss) margin		27.9	%		9.4	%		4.7	%		(2.0)	%		40.5	%		13.4	%

For the nine months ended September 30, 2018:
External revenue	$	15,548	*	$	12,326	*	$	21,846	*	$	5,412		$	1,188		$	56,319	*
Internal revenue		2,518	*		249			589	*		576			1,240			5,173	*
Total revenue	$	18,066	*	$	12,575	*	$	22,435	*	$	5,989		$	2,428		$	61,492	*
Pre-tax income/(loss) from continuing operations	$	5,760	*	$	1,063	*	$	1,124	*	$	352		$	1,042		$	9,342	*
Pre-tax income/(loss) margin		31.9	%*		8.5	%*		5.0	%*		5.9	%		42.9	%		15.2	%*

* Recast to conform to 2019 presentation.

Reconciliations to IBM as Reported:


(Dollars in millions)
For the nine months ended September 30:	2019		2018
Revenue:
Total reportable segments	$	59,065	$	61,492	*
Other — divested businesses		754		1,335	*
Other revenue		190		176
Eliminations of internal transactions		(4,638)		(5,173)	*
Total consolidated revenue	$	55,370	$	57,830

Pre-tax income from continuing operations:
Total reportable segments	$	7,941	$	9,342	*
Amortization of acquired intangible assets		(816)		(613)
Acquisition-related (charges)/income		(396)		(3)
Non-operating retirement-related (costs)/income		(419)		(1,185)
Eliminations of internal transactions		(233)		(615)	*
Other — divested businesses		477		265	*
Unallocated corporate amounts		(380)		(283)
Total pre-tax income from continuing operations	$	6,173	$	6,908

* Recast to conform to 2019 presentation.