IBM plans to capitalize on the fact that marketing departments spend a bigger cut of their revenue on information technology than IT departments, a very ambitious move that can be credited to chief executive Virginia Rometty. IBM’s first female CEO entered office in January this year.
While IBM’s revenue is expected to drop by one percent in Q2, marketing departments’ spending will increase by nine. And about a third of this is going into software that helps marketers manage customer relations and predict consumer trends – an industry that was worth no less than $25 billion in 2011.
“Yuchun Lee, an IBM vice president who is one of the strategy’s architects, says the company is making investments in technology that could help clients manage online customer interactions, analyze social media data and craft targeted pitches,” writes the Wall Street Journal.
Over the past few years, IBM has spent $3 billion acquiring companies in this market, such as Coremetrics, DemandTec Inc. and Tealeaf Technology Inc., Mr. Lee said.”
IBM hopes to capitalize on marketers’ use of among other things, like analytics software, to boost its revenue, a push that analysts will definitely be watching as it progresses. But in the meanwhile the company managed to boost its profit substantially: today it is expected to report an increase of 10 percent in net income. That’s a handsome t $3.42 per share.
IBM will have to straighten up its bottom line a bit, and that accomplishment will be follow another one that was just announced this week – the firm built the most powerful supercomputer on earth. Sequoia as it’s called dethrones Japan’s K System with 98,304 nodes and 1.6 cores that add up to 1.6 petabytes of memory and a performance of 16.32 petaflops per second. To top it all off, Sequoia only requires one third of the voltage it takes to power the K System.