Segments (Tables)

6 Months Ended

Jun. 30, 2022

Segments

Revenue and Pre-tax Income by Segment

													Total
(Dollars in millions)	Software			Consulting			Infrastructure			Financing			Segments
For the three months ended June 30, 2022:
Revenue	$	6,166		$	4,809		$	4,235		$	146		$	15,355
Pre-tax income from continuing operations	$	1,375		$	343		$	757		$	102		$	2,577
Revenue year-to-year change		6.4	%		9.8	%		19.0	%		(29.9)	%		10.1	%
Pre-tax income year-to-year change		29.9	%		26.9	%		54.8	%		(22.4)	%		32.2	%
Pre-tax income margin		22.3	%		7.1	%		17.9	%		69.7	%		16.8	%
For the three months ended June 30, 2021*:
Revenue	$	5,795		$	4,378		$	3,560		$	209		$	13,941
Pre-tax income from continuing operations	$	1,059		$	270		$	489		$	131		$	1,949
Pre-tax income margin		18.3	%		6.2	%		13.7	%		63.0	%		14.0	%

													Total
(Dollars in millions)	Software			Consulting			Infrastructure			Financing			Segments
For the six months ended June 30, 2022:
Revenue	$	11,938		$	9,637		$	7,453		$	300		$	29,328
Pre-tax income from continuing operations	$	2,509		$	691		$	956		$	186		$	4,342
Revenue year-to-year change		9.2	%		11.5	%		8.8	%		(28.0)	%		9.3	%
Pre-tax income year-to-year change		46.2	%		26.3	%		22.5	%		(18.9)	%		32.6	%
Pre-tax income margin		21.0	%		7.2	%		12.8	%		62.0	%		14.8	%
For the six months ended June 30, 2021*:
Revenue	$	10,933		$	8,641		$	6,853		$	417		$	26,843
Pre-tax income from continuing operations	$	1,717		$	547		$	780		$	229		$	3,274
Pre-tax income margin		15.7	%		6.3	%		11.4	%		55.0	%		12.2	%

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

Reconciliations to IBM as Reported:

(Dollars in millions)
For the three months ended June 30:	2022			2021*
Revenue:
Total reportable segments	$	15,355		$	13,941
Other‒divested businesses		162			197
Other revenue		18			80
Total consolidated revenue	$	15,535		$	14,218
Pre-tax income from continuing operations:
Total reportable segments	$	2,577		$	1,949
Amortization of acquired intangible assets		(458)			(456)
Acquisition-related (charges)/income		(2)			(18)
Non-operating retirement-related (costs)/income		(192)			(317)
Kyndryl-related impacts**		(145)			—
Eliminations of internal transactions		(4)			5
Other‒divested businesses		160	+		(50)
Unallocated corporate amounts and other		(215)			(202)
Total pre-tax income from continuing operations	$	1,722		$	912

* Recast to conform to current year presentation.

** Refer to note 8, “Financial Assets & Liabilities,” for additional information.

+ Includes a gain from the sale of the company’s healthcare software assets. Refer to note 6, “Acquisitions & Divestitures.”

Reconciliations to IBM as Reported:

(Dollars in millions)
For the six months ended June 30:	2022			2021*
Revenue:
Total reportable segments	$	29,328		$	26,843
Other‒divested businesses		316			394
Other revenue		88			167
Total consolidated revenue	$	29,732		$	27,405
Pre-tax income from continuing operations:
Total reportable segments	$	4,342		$	3,274
Amortization of acquired intangible assets		(919)			(903)
Acquisition-related charges		(9)			(34)
Non-operating retirement-related (costs)/income		(394)			(649)
Kyndryl-related impacts**		(367)			—
Eliminations of internal transactions		(15)			(4)
Other‒divested businesses		109	+		(65)
Unallocated corporate amounts		(403)			(464)
Total pre-tax income from continuing operations	$	2,345		$	1,155

* Recast to conform to current year presentation.

** Refer to note 8, “Financial Assets & Liabilities,” for additional information.

+ Includes a gain from the sale of the company’s healthcare software assets. Refer to note 6, “Acquisitions & Divestitures.”