International Business Machines Corp posted a new 2015 profit target and quarterly revenue that both missed analysts’ estimates,

as the one-time world technology leader continues to grapple with its journey from low-margin hardware maker to the new world of

cloud computing.
Shares of IBM, which is still the world’s largest technology services company, but no longer regarded as a leader in innovation,

fell 1.8% to $154.05 in extended trading.
It was the 11th straight quarter that the Armonk, New York-based company has reported falling quarterly revenue, including the

effects of currency. It has seen shrinking revenue for three years now as it sheds low-profit businesses such as cash registers,

low-end servers and semiconductors and tries to focus on emerging areas such as security software and cloud services.
But the new businesses have so far failed to make up for revenue lost to divestitures. Annual revenue fell to $93bn for 2014,

from $107bn in 2011. The company had no guarantee that it would not fall further.  “We’re not interested in revenue for revenue’s

sake,” IBM chief financial officer Martin Schroeter told Reuters in a phone interview. “We’ll continue to divest if something

doesn’t fit the model.”
The struggle to make headway in the new Internet-based technology industry is shared by other longstanding giants.
SAP SE, Europe’s largest software group, on Tuesday cut key profit forecasts and abandoned a target for higher margins.
“IBM as well as other tech stalwarts such as Oracle , SAP, HP and Cisco face major headwinds as they adjust to this new cloud

paradigm shift, which coupled with a cloudy IT spending environment have negatively impacted results,” said Daniel Ives, an

analyst at FBR Capital Markets.
IBM last year withdrew its long-term plan to hit $20 per share in operating earnings for 2015, as it recognised that its

transition was faltering.
On Tuesday, IBM forecast 2015 operating earnings of $15.75 to $16.50 per share, just shy of analysts’ average estimate of $16.53,

according to Thomson Reuters I/B/E/S.
For the fourth quarter, IBM’s total revenue fell nearly 12% to $24.11bn. Revenue from hardware fell 39% to $2.41bn.
On an adjusted basis, the company earned $5.81 per share. Analysts on average were expecting a profit of $5.41 per share on

revenue of $24.77bn. IBM shares closed at $156.95 on the New York Stock Exchange on Tuesday.


UnitedHealth
UnitedHealth Group, the largest US health insurer, yesterday reported a better-than-expected fourth-quarter profit as it added

new customers in government-paid plans and its Optum pharmacy management business hit record revenue.
Profit in its health insurance business, which includes commercial and government customers, was helped by medical costs that the

company described as being “well controlled,” and decreased inpatient hospital use per person in 2014.
Low hospital and medical use has helped keep medical claims down and profits up at insurers during the past several years, even

as the US healthcare system has undergone major reform under the Affordable Care Act.
“We believe these results offer a solid finish to a year of transition,” BMO Capital Markets analyst Jennifer Lynch said in a

research note.  UnitedHealth’s shares rose 2.2% in premarket trading.
The company reported a medical care ratio, or the amount it spends on medical claims compared with the insurance premiums that it

brings in, of 79.8%. It was 81.2% a year earlier.
Health insurers have faced many changes during the past few years as the national healthcare reform law, often called Obamacare,

took effect. The law has brought higher fees and taxes for insurers and has also created a new individual healthcare insurance

market and expanded the ranks of Medicaid, which has helped increase revenue.
The company reported quarterly revenue of $33.4bn, up from $31.1bn a year earlier. Revenue in its Optum pharmacy management

business increased to $8.5bn from $6.9bn a year earlier.
UnitedHealth said it sees 2015 revenue at between $140.5bn and $141.5bn and net earnings in the range of $6 to $6.25 per share.
Analyst’s were expecting 2015 net earnings of $6.17 per share on revenue of $140.90bn, according to Thomson Reuters I/B/E/S.
The company’s earnings rose to $1.5bn, or $1.55 per share, in the quarter ended Deember 31, from $1.4bn, or $1.41 per share, a

year earlier.
Analysts had expected a profit of $1.50 per share and revenue of $33.11bn.


Netflix
Streaming video service Netflix said it will complete its expansion into 200 countries within two years, faster than expected, as

the company builds its presence overseas while growth in the US slows.
Netflix said on Tuesday it added 4.3mn subscribers in the quarter that ended in December, beating its own guidance thanks to

higher-than-expected interest overseas. Investors welcomed the news, sending shares up 15% in after-hours trading.
In the US, Netflix pulled in 1.9mn streaming customers, down from 2.3mn additions a year earlier, and forecast signing up 1.8mn

more in the current quarter.
Netflix believes the slowdown is “a natural progression in our large US market as we grow,” Netflix said in a quarterly letter to

shareholders.
In international markets, however, “progress has been so strong that we now believe we can complete our global expansion over the

next two years, while staying profitable, which is earlier than we expected,” it said.
Netflix added 2.4mn customers in its roughly 50 international markets, bringing its global total to 57.4mn worldwide.
“This company is going through a transition, one of a domestic growth story to one of domestic maturity, where the growth story

is really international,” FBR Capital Markets analyst Barton Crockett said.
New markets will include a “modest investment” in China, chief executive officer Reed Hastings said on a conference call. Netflix

needs a license to operate in the country, and “it’s not 100% clear we’ll be able to do that,” he said.
Netflix also said it will increase the percentage of content spending devoted to original series such as “Orange Is the New

Black” and “House of Cards,” and will finance the expansion with long-term debt. The company is investing in original shows as it

faces competition from Time Warner’s HBO, Amazon.com and Hulu, as well as on-demand offerings from pay TV providers.
For the quarter that ended in December, net income rose to $83.4mn, or $1.35 per share, from $48.4mn, or 79¢ per share, a year

earlier.
Excluding a 63¢ benefit from a tax accrual release related to resolution of a tax audit, the company reported a profit of 72

cents per share.
Revenue rose to $1.48bn from $1.18bn.
Analysts had expected profit of 45¢ per share, according to Thomson Reuters I/B/E/S.