Moody's Investors Service downgraded IBM Corp.'s Aa3 rating by one notch to A1 and revised its outlook to stable from negative. "Despite still solid debt protection measures and progress in transitioning its business towards becoming a provider of enterprise class, data analytics and cloud-based offerings, the downgrade reflects the transformation and high level of investments which have negatively impacted IBM's profitability and cash flow, as well as concerns that IBM will remain challenged for a longer than previously anticipated time to grow total revenue and return to the margin profile achieved prior to 2016," said Richard Lane, a Moody's senior vice president. IBM has made progress in shifting toward cloud services, but total revenue has been flat or negative for 19 quarters, said the analyst.
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