The IT software and services provider has been focusing on the so-called "hybrid cloud" after spinning off its legacy IT-managed infrastructure business and posted double-digit growth across all its segments and geographies on a constant-currency basis for the third quarter.
IBM, whose cloud revenue rose 11% to $5.2 billion in the quarter, now expects its annual revenue to increase more than its previous estimate of mid-single-digit growth at constant currency.
Industry experts largely view digital transformation projects serviced by the likes of IBM to be resilient in an economic slowdown as more businesses turn to technology to reduce costs.
Still, this year's near 17% surge in the dollar is chipping away at the company's earnings, mirroring a trend seen at peers Microsoft Corp, Accenture and Salesforce Inc that also have sprawling international operations.
IBM, which makes 60% of its revenue from outside the United States, increased its full-year estimate for foreign exchange impact to 7% from 6%.
The company booked a forex hit of $1.1 billion in the third quarter.
Revenue came in at $14.12 billion, compared with $13.51 billion expected by analysts, according to Refinitiv data.
While IBM is somewhat shielded from IT budget cuts due to the recurring nature of half of its business, a change in spending patterns could hit the company. IT consulting firm Accenture said last month that customers were accelerating project timeframes.
IBM swung to a net loss of $3.20 billion, or $3.54 per share, in the third quarter, compared with a profit of $1.13 billion, or $1.25 per share, a year earlier, due to a one-time, non-cash pension settlement charge of about $5.9 billion.
(Reporting by Chavi Mehta in Bengaluru; Editing by Krishna Chandra Eluri and Shounak Dasgupta)
By Chavi Mehta
