IBM Corporation Case Study

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IBM Corp From 1996 to 1997, IBM saw their ROE increase between 15 and 25%. During 1998 to the first quarter of 2000, is when they began to steadily decrease from 27 to 18%. These factors are showing how IBM is having trouble increasing their ROE after 1998. This is because the company was experiencing a slowdown in capital spending. In the first quarter of 2000, these figures came in at a rate similar to what was experienced in late 1996. These trends are illustrating how the company is seeing a decline in their net income. This is decreasing the ROE percentages, with them gradually declining in 1999. In the first quarter of 2000, these amounts became more severe. ("IBM Corporation," 2013)

Revenue growth peaked in the final quarter of 1998. This is when the company saw the highest levels of sales, with customers spending...

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At the same time, they are determining how much new equipment they will purchase in the future. These amounts were much lower in 1997 and 1998. However, by 1999 and the first quarter of 2000, is when these figures began to increase. This is indicating that IBM is not selling as much of their products during some of their busiest times of the year. The gross margins are following a similar trend. This is taking place with them reaching a peak in 1998. ("IBM Corporation," 2013)
The biggest factors that contributed to an increase in the earnings per share were higher levels of capital spending in the last quarter. At the same time, these amounts were greater in anticipation of the Y2K switch. However, once the end of 1999 arrived, is the point these levels began to decrease. This is…

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IBM Corporation. (2013).

Identify the Industries. (2013).


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