IBM vs. Oracle: Big Blue Hiring 1,500 Software Sales Pros
Move over, Oracle and HP Autonomy. IBM Software is betting big on business analytics and cloud software. Indeed, IBM (NYSE: IBM) will hire roughly 1,500 sales representatives from now through the end of 2012, according to CFO Mark Loughridge. For IBM’s channel partners the message is clear: Bet heavily on software now, and reap the profits as worldwide economies start to improve.
“We see great opportunity in our global software business and are hiring 200 to 300 sales representatives each month through year end,” Loughridge said during IBM’s Q2 2012 earnings call today.
While IBM’s top-line revenues face macroeconomic pressure, CEO Ginny Rometty raised IBM’s full-year earnings forecast.
Not Exactly Stellar
Overall, IBM’s software business has delivered mixed results so far this year. For Q2 2012:
- Software revenues were flat but up 4 percent adjusted for currency.
- Software pre-tax income increased 8 percent and pre-tax margin increased to 35.9 percent. Solid stuff.
- Revenues from IBM’s core middleware products, which include WebSphere, Information Management, Tivoli, Lotus and Rational products, were $3.9 billion, flat (up 4 percent, adjusting for currency) versus the second quarter of 2011.
- Operating systems revenues of $628 million were flat (up 3 percent, adjusting for currency) compared with the prior-year quarter.
- Revenues from the WebSphere family of software products increased 3 percent year over year.
- Information Management software revenues decreased 1 percent.
- Revenues from Tivoli software increased 2 percent.
- Revenues from Lotus software decreased 8 percent. (Ouch. Is hosted Exchange squeezing Lotus?)
- Rational software decreased 7 percent.
Despite those mixed results, IBM sees people power — more sales representatives — as a potential driver for more software revenues. Will channel partners follow that lead? Hmmm…
Meanwhile, Oracle has been executing well in recent months and the company is pursuing top-line hardware growth right now. Elsewhere, Hewlett-Packard hit some software bumps with its Autonomy business earlier this year — but HP is stating to show some synergies across its software lineup.