Computing giant IBM has announced profits of $2.6 billion for the first three months of the year, up 13 per cent on the same period last year.
The results beat official Wall Street forecasts, but in a newly bullish market buoyed by strong results from the likes of Intel and AMD, still fell short of the most optimistic forecasts.
And despite the firm having predicted continued growth in the quarter to come, IBM's shares fell around two per cent in after-hours trading.
Total revenues for the quarter were $22.9 billion, an increase of five per cent year-on-year, though IBM said adjusted for currency fluctuations caused by a weakened dollar, revenues were effectively flat.
"We had strong results in strategic investment areas including growth markets, business analytics and Smarter Planet solutions," said IBM chief executive Sam Palmisano in a statement.
In light of the results and reflecting the widely held sentiment that the recession is now officially over, Palmisano raised the company's earnings per share forecast for 2010 from $11 to $11.20.
"We are confident in our ability to grow revenue," he added.
While other technology firms have posted more dramatic improvements year on year, IBM pointed out that this was because it had protected its revenues during the downturn thanks to cost-cutting.
The drop on the company's share price is likely a reflection of investor disappointment in IBM's performance in its biggest division the provision of technology services and consulting, which is responsible for half of the company's revenues.
While IBM's services division did post a four per cent increase in revenues in the first quarter, adjusted for currency fluctuations that actually represents a two per cent drop on 2009's levels. In addition, the signing of new services deals fell two per cent (seven per cent adjusted) in the quarter to a total of $12.3 billion.
Software was the company's most profitable division, marking an 11 per cent jump in revenues to a total of $5 billion, while its server and mainframe hardware division grew five per cent to $3.4 billion.
