Segments

3 Months Ended

Mar. 31, 2023

Segments

Segments

4. Segments:

The following tables reflect the results of continuing operations of the company’s segments consistent with the management and measurement system utilized within the company. Performance measurement is based on pre-tax income from continuing operations. These results are used by the chief operating decision maker, both in evaluating the performance of, and in allocating resources to, each of the segments.

SEGMENT INFORMATION

													Total
(Dollars in millions)	Software			Consulting			Infrastructure			Financing			Segments
For the three months ended March 31, 2023:
Revenue	$	5,921		$	4,962		$	3,098		$	196		$	14,177
Pre-tax income from continuing operations	$	1,164		$	382		$	216		$	100		$	1,863
Revenue year-to-year change		2.6	%		2.8	%		(3.7)	%		27.3	%		1.5	%
Pre-tax income year-to-year change		2.7	%		9.6	%		8.5	%		19.6	%		5.5	%
Pre-tax income margin		19.7	%		7.7	%		7.0	%		51.3	%		13.1	%
For the three months ended March 31, 2022:
Revenue	$	5,772		$	4,829		$	3,219		$	154		$	13,973
Pre-tax income from continuing operations	$	1,134		$	348		$	199		$	84		$	1,766
Pre-tax income margin		19.7	%		7.2	%		6.2	%		54.6	%		12.6	%

Reconciliations to IBM as Reported:

(Dollars in millions)
For the three months ended March 31:	2023		2022
Revenue:
Total reportable segments	$	14,177	$	13,973
Other‒divested businesses		0		154
Other revenue		75		70
Total consolidated revenue	$	14,252	$	14,197
Pre-tax income/(loss) from continuing operations:
Total reportable segments	$	1,863	$	1,766
Amortization of acquired intangible assets		(392)		(461)
Acquisition-related (charges)/income		(3)		(7)
Non-operating retirement-related (costs)/income		5		(202)
Kyndryl-related impacts		—		(222)	*
Workforce rebalancing charges**		(259)		—
Other‒divested businesses		(4)		(52)
Unallocated corporate amounts and other		(151)		(199)	È
Total pre-tax income from continuing operations	$	1,058	$	623

* Unrealized loss on Kyndryl retained shares. See note 5, “Acquisitions & Divestitures,” for additional information.

** Beginning in the first quarter of 2023, the company updated its measure of segment pre-tax income, consistent with its management system, to no longer allocate workforce rebalancing charges to its segments. Workforce rebalancing charges in the first quarter of 2022 of $5 million were included in the segments.

^È Recast to conform to 2023 presentation.