10 Metrics Highlight IBM's Thriving Business

Is International Business Machines (NYSE: IBM) about to finally return to growth? IBM's long streak of declining revenue on a year-over-year basis nearly ground to a halt in the third quarter as the company crushed analysts' consensus revenue estimates. Furthermore, a close look at the quarter's results highlights a thriving business, suggesting a return to growth is all but certain.

Here are 10 of the most telling metrics from the quarter.

1. 9%

Showing just how impressed investors were with its third-quarter results, IBM's shares surged 9% on Wednesday, following the company's earnings release.

2. 3%

Where IBM's results likely surprised investors the most was the company's reported revenue. Its $19.2 billion in third-quarter revenue was an impressive 3% higher than the consensus estimate for the quarter.

3. 10%

Though IBM's third-quarter revenue was nearly flat compared to the year-ago quarter, its revenue from strategic imperatives -- cloud, analytics, mobile, social, and security -- climbed 10% year over year. Furthermore, strategic imperatives revenue is up 10% year over year in the trailing-12-month period.

4. 45%

Strategic imperatives revenue has quickly grown in importance to IBM. It now represents 45% of trailing-12-month revenue, up from 40% of revenue during the 12 months ending the same time last year.

5. $40 billion

Given this ongoing strength in strategic imperatives, IBM still expects full-year strategic imperatives revenue to reach $40 billion by the end of the year, up from trailing-12-month revenue of $34.9 billion.

6. $15.8 billion

IBM's cloud revenue continued to grow rapidly, up 20% year over year. Moreover, its trailing-12-month cloud revenue stands at a meaningful $15.8 billion. Highlighting the size of this figure: It's higher than Amazon (NASDAQ: AMZN) Web Services' trailing-12-month revenue, in Amazon's second quarter, of $14.5 billion. Of course, Amazon's 42% year-over-year growth in AWS revenue in Q2 suggests the e-commerce giant's cloud revenue is on pace to pass up IBM's in the near future. But it's definitely notable to see IBM's cloud segment driving such strong and meaningful growth.

7. 49%

IBM's security revenue soared 49% year over year, helped by its new IBM z Systems mainframe. IBM's security offerings are positioned to benefit from corporations' rising spending on data encryption.

8. $2.5 billion

IBM's third-quarter free cash flow of $2.5 billion -- up $100 million from the year-ago quarter -- demonstrates the company's financial operating strength.

9. $8 billion

In the first three quarters of the year, IBM has returned nearly $8 billion to shareholders through dividends and share repurchases. The company's consistent ability to generate free cash flow, combined with management's long track record of dividends, make IBM one of the safest dividend stocks in tech.

10. Eight quarters

With IBM's third-quarter non-GAAP (generally accepted accounting principles) earnings per share for the quarter coming in at $3.30, ahead of a consensus analyst estimate for $3.28, the company has beat the Street's consensus estimates for earnings per share for eight quarters in a row.

With recent performance like this, it's no surprise that IBM finally expects to return to growth in its fourth quarter. During the recent earnings call, management said it expected continued strength in security will help the company finally post year-over-year revenue growth. And given the overall state of IBM's business, growth will likely persist in 2018 and beyond.

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Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.