IBM (IBM) is scheduled to report results of its fiscal first quarter after the market close on April 20, with a conference call scheduled for 5:00 pm ET. What to watch for:
1. 2020 EPS CONSENSUS DOWN SHARPLY: Along with its last report, IBM guided for fiscal 2020 adjusted earnings per share of "at least" $13.35. At the time, analysts were expecting the company to report FY20 EPS of $13.29, but that consensus estimate has slipped to $11.73.
2. NEW CEO: In late January, IBM's board of directors announced that it had named Arvind Krishna as its next CEO effective April 6, succeeding Virginia "Ginni" Rometty. Prior to his appointment, Krishna served as IBM's senior VP for Cloud and Cognitive Software, and was a principal architect of the company's acquisition of Red Hat. The company said at the time that Rometty would remain in her role as executive chairman of the board and serve through the end of the year, at which point she will retire after nearly 40 years with IBM.
"Arvind is the right CEO for the next era at IBM," Rometty said at the time. "He is a brilliant technologist who has played a significant role in developing our key technologies such as artificial intelligence, cloud, quantum computing and blockchain. He is also a superb operational leader, able to win today while building the business of tomorrow. Arvind has grown IBM's Cloud and Cognitive Software business and led the largest acquisition in the company's history. Through his multiple experiences running businesses in IBM, Arvind has built an outstanding track record of bold transformations and proven business results, and is an authentic, values-driven leader. He is well-positioned to lead IBM and its clients into the cloud and cognitive era."
3. KRISHNA ON COVID-19: In an interview with CNBC earlier this month, CEO Arvind Krishna said that the COVID-19 outbreak, which had led to the cancellation of several in-person events the company was planning, could push companies to accelerate their adoption of modern technologies such as artificial intelligence and cloud. The CEO noted that the world is just 20% in to cloud, and it has taken advantage of only 4% of the potential for productivity in AI, according to CNBC's Jordan Novet. Krishna also told CNBC that IBM itself has made technological changes to help roughly 95% of its workers work from home so they avoid furthering the spread of the virus.
"When we look at the usage of AI and cloud, I think it is especially going to accelerate also not just us, but how our clients are going to go on their digital transformations," Krishna said. "And I believe this crisis is only going to accelerate that as we go over the next few months."
4. PC MARKET: The global traditional PC market, comprised of desktops, notebooks, and workstations, declined 9.8% year over year in the first quarter of 2020, reaching a total of 53.2M shipments according to preliminary results from the International Data Corporation Worldwide Quarterly Personal Computing Device Tracker released last week. The stark decline after a year of growth in 2019 was the result of reduced supply due to the outbreak of COVID-19 in China, the world's largest supplier of PCs, according to IDC.