File - IBM has said it will pay $1.5 billion to Globalfoundries in order to shed its costly chip division.
Your feedback is important to us!
We invite all our readers to share with us their views and comments about this article.
Disclaimer: Comments submitted by third parties on this site are the sole responsibility of the individual(s) whose content is submitted. The Daily Star accepts no responsibility for the content of comment(s), including, without limitation, any error, omission or inaccuracy therein. Please note that your email address will NOT appear on the site.
Alert: If you are facing problems with posting comments, please note that you must verify your email with Disqus prior to posting a comment. follow this link to make sure your account meets the requirements. (http://bit.ly/vDisqus)
Shares of both Coca-Cola and IBM fell more than 6 percent this week following their respective earnings, underscoring failings in their strategies.For IBM, it's the opposite: After years of financial maneuvering to fund buybacks and dividends, investors want good old-fashioned sales growth.IBM and Coca-Cola are in the bottom fifth of the Standard & Poor's 500 Index in terms of quarterly sales growth. Five years into a U.S. expansion – with the unemployment rate down to a six-year low of 5.9 percent – shareholders are looking for more dramatic remedies from companies that aren't sharing in the economic gains. IBM, meanwhile, has spent $19 billion buying back its shares in the past 12 months.Now that earnings growth has also slowed, investors are no long satisfied with IBM's sales, which fell more in the most recently reported quarter than 93 percent of companies in the S&P 500, according to data compiled by Bloomberg. Then this week, IBM reported its 10th straight decline in revenue and had to scrap a five-year profit forecast, telling investors that annual adjusted earnings would fall this year for the first time since 2002 .
FOLLOW THIS ARTICLE