Segments (Tables)

12 Months Ended

Dec. 31, 2020

Segments

Revenue and Pre-tax Income by Segment

($ in millions)
	Cloud &			Global			Global
	Cognitive			Business			Technology						Global			Total
For the year ended December 31:	Software			Services			Services			Systems			Financing			Segments
2020
External revenue	$	23,376		$	16,162		$	25,812		$	6,978		$	1,123		$	73,451
Internal revenue		3,169			193			1,226			824			894			6,306
Total revenue	$	26,545		$	16,355		$	27,039		$	7,802		$	2,017		$	79,758
Pre-tax income from continuing operationsÈ	$	6,362		$	1,351		$	117		$	449		$	761		$	9,040
Revenue year-to-year change		3.2	%		(4.2)	%		(5.2)	%		(6.3)	%		(23.4)	%		(3.1)	%
Pre-tax income year-to-year change		(18.5)	%		(16.8)	%		(92.9)	%		(36.0)	%		(27.8)	%		(29.6)	%
Pre-tax income margin		24.0	%		8.3	%		0.4	%		5.8	%		37.7	%		11.3	%
2019
External revenue	$	22,891	*	$	16,798	*	$	27,361		$	7,604		$	1,400		$	76,054	*
Internal revenue		2,827			278			1,157			726			1,232			6,220
Total revenue	$	25,718	*	$	17,076	*	$	28,518		$	8,330		$	2,632		$	82,274	*
Pre-tax income from continuing operations	$	7,811	*	$	1,623	*	$	1,645		$	701		$	1,055		$	12,835	*
Revenue year-to-year change		2.7	%*		(0.3)	%*		(5.0)	%		(5.9)	%		(17.8)	%		(2.3)	%*
Pre-tax income year-to-year change		(12.4)	%*		1.3	%*		(7.6)	%		(22.4)	%		(22.5)	%		(11.9)	%*
Pre-tax income margin		30.4	%*		9.5	%*		5.8	%		8.4	%		40.1	%		15.6	%*
2018
External revenue	$	21,857	*	$	16,795	*	$	29,146		$	8,034		$	1,590		$	77,421	*
Internal revenue		3,190			326			872			815			1,610			6,813
Total revenue	$	25,047	*	$	17,121	*	$	30,018		$	8,848		$	3,200		$	84,235	*
Pre-tax income from continuing operations	$	8,914	*	$	1,602	*	$	1,781		$	904		$	1,361		$	14,562	*
Revenue year-to-year change		2.0	%*		3.0	%*		0.5	%		(1.1)	%		1.0	%		1.3	%*
Pre-tax income year-to-year change		10.0	%*		26.2	%*		(32.0)	%		(19.9)	%		6.5	%		1.2	%*
Pre-tax income margin		35.6	%*		9.4	%*		5.9	%		10.2	%		42.5	%		17.3	%*

^È Includes the impact of a $2.0 billion pre-tax charge for structural actions in the fourth quarter of 2020.

* Recast to conform to 2020 presentation.

Reconciliation of segment revenue and pre-tax income to IBM as reported

Reconciliations of IBM as Reported

($ in millions)
For the year ended December 31:	2020		2019			2018
Revenue
Total reportable segments	$	79,758	$	82,274	*	$	84,235	*
Other—divested businesses		37		930	*		1,961	*
Other revenue		132		162			207
Elimination of internal transactions		(6,306)		(6,220)			(6,813)
Total IBM consolidated revenue	$	73,620	$	77,147		$	79,591

* Recast to conform to 2020 presentation.

($ in millions)
For the year ended December 31:	2020			2019			2018
Pre-tax income from continuing operations
Total reportable segments	$	9,040	È	$	12,835	*	$	14,562	*
Amortization of acquired intangible assets		(1,858)			(1,298)			(809)
Acquisition-related charges		(13)			(423)			(16)
Non-operating retirement-related (costs)/income		(1,123)			(615)			(1,572)
Spin-off-related charges		(28)			—			—
Elimination of internal transactions		(381)			(290)			(725)
Other—divested businesses		(9)			574	*		287	*
Unallocated corporate amounts		(990)			(617)			(385)
Total pre-tax income from continuing operations	$	4,637	È	$	10,166		$	11,342

^È Includes the impact of a $2.0 billion pre-tax charge for structural actions in the fourth quarter of 2020.

* Recast to conform to 2020 presentation.

Assets and Other Items by segment

($ in millions)
	Cloud &			Global			Global
	Cognitive			Business			Technology				Global		Total
For the year ended December 31:	Software			Services			Services		Systems		Financing		Segments
2020
Assets	$	58,752		$	10,290		$	21,971	$	4,620	$	25,075	$	120,708
Depreciation/amortization of intangibles**		1,168			180			2,605		343		119		4,415
Capital expenditures/investments in intangibles		548			28			2,039		249		41		2,906
Interest income		—			—			—		—		1,058		1,058
Interest expense		—			—			—		—		307		307
2019
Assets	$	58,342	*	$	10,136	*	$	22,436	$	4,590	$	29,568	$	125,072	*
Depreciation/amortization of intangibles**		1,089	*		167	*		2,601		350		186		4,392
Capital expenditures/investments in intangibles		517	*		47	*		1,575		305		57		2,501
Interest income		—			—			—		—		1,490		1,490
Interest expense		—			—			—		—		512		512
2018
Assets	$	28,502	*	$	8,443	*	$	17,624	$	4,030	$	41,320	$	99,920	*
Depreciation/amortization of intangibles**		1,051	*		108	*		2,359		315		229		4,063
Capital expenditures/investments in intangibles		468	*		58	*		2,569		241		274		3,610
Interest income		—			—			—		—		1,647		1,647
Interest expense		—			—			—		—		515		515

* Recast to conform to 2020 presentation.

** 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:	2020		2019			2018
Assets
Total reportable segments	$	120,708	$	125,072	*	$	99,920	*
Elimination of internal transactions		(4,685)		(4,317)			(7,143)
Other-divested businesses		218		1,906	*		2,702	*
Unallocated amounts
Cash and marketable securities		12,486		7,308			10,393
Notes and accounts receivable		1,589		1,488	*		1,597
Deferred tax assets		9,012		4,995			5,089
Plant, other property and equipment		2,206		2,262	*		2,463	*
Operating right-of-use assets**		3,409		3,530			—
Pension assets		7,610		6,865			4,666
Other		3,417		3,077	*		3,695	*
Total IBM consolidated assets	$	155,971	$	152,186		$	123,382

* Recast to conform to 2020 presentation.

** Reflects the adoption of the FASB guidance on leases in 2019.

Geographic Information

Revenue*

($ in millions)
For the year ended December 31:	2020		2019		2018
United States	$	26,978	$	28,395	$	29,078
Japan		8,694		8,681		8,489
Other countries		37,949		40,071		42,024
Total IBM consolidated revenue	$	73,620	$	77,147	$	79,591

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

Plant and Other Property–Net

($ in millions)
At December 31:	2020		2019		2018
United States	$	4,410	$	4,485	$	4,585
Other countries		5,533		5,294		5,774
Total	$	9,943	$	9,778	$	10,359

Operating Right-of-Use Assets–Net*

($ in millions)
At December 31:	2020		2019		2018
United States	$	1,243	$	1,386	$	—
Japan		606		659		—
Other countries		2,836		2,951		—
Total	$	4,686	$	4,996	$	—

* Reflects the adoption of the FASB guidance on leases in 2019.

Revenue by Classes of Similar Products or Services

($ in millions)
For the year ended December 31:	2020		2019			2018
Cloud & Cognitive Software
Software	$	19,107	$	18,649	*	$	17,906	*
Services		4,159		4,076	*		3,795	*
Systems		110		166			156
Global Business Services
Services	$	15,896	$	16,527	*	$	16,439	*
Software		180		156			151
Systems		86		115			206
Global Technology Services
Services	$	19,632	$	20,768		$	22,222
Maintenance		4,815		5,183			5,484
Systems		967		1,072			1,069
Software		399		338			371
Systems
Servers	$	3,466	$	3,746		$	3,996
Storage		1,801		1,920			2,114
Software		1,359		1,528			1,499
Services		351		410			425
Global Financing
Financing	$	834	$	1,120		$	1,223
Used equipment sales		289		281			366

* Recast to conform to 2020 presentation.