IBM earnings Q2 2018

Andrew Harrer | Bloomberg | Getty Images

Ginni Rometty, chief executive officer of International Business Machines Corp.

IBM will report second-quarter earnings after the bell on Wednesday. The company will hold a press conference with analysts at 5 p.m. Eastern time.

Here’s what analysts are expecting:

• Earnings: $3.04 per share, excluding certain items, according to Thomson Reuters.
• Revenue: $19.85 billion in revenue, according to Thomson Reuters.

The estimate for revenue indicates that analysts believe IBM will report revenue growth for the third consecutive quarter, following five years of year-over-year revenue declines.

In a Tuesday note, Cantor Fitzgerald analysts led by Joseph Foresi said they were expecting a decrease in margins in the quarter. They thought second-quarter numbers would get a boost thanks to recent currency trends.

In the second quarter, the company acquired Oniqua, and IBM CEO Ginni Rometty said it had designed the world’s fastest supercomputer. The company also confirmed that layoffs impacted its Watson Health group.

“While this may be anecdotal, we attended a major healthcare IT conference this spring, and informal conversations with Watson Health employees suggested that the business is beginning to feel a lot more cohesive and integrated than previously,” Stifel analysts led by David Grossman wrote in a July 12 note.

And in late June, Nomura Instinet analysts led by Jeffrey Kvaal began coverage of IBM, with an initial rating of buy and a target price of $160.

“After years of revenue declines, IBM is poised to return to sustainable, if modest, revenue growth and mid-single-digit EPS growth,” the analysts wrote.

IBM stock is down 6 percent since the beginning of the year.

Programming Note: For more on IBM, watch “Mad Money” host Jim Cramer’s interview with IBM senior vice president of global markets Martin Schroeter tonight at 6 p.m. Eastern time.

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