Despite beating Wall Street's earnings forecast for its fiscal fourth quarter, IBM missed revenue expectations because of weak server, storage and hardware sales.
IBM's revenue dropped from $29.3 billion last year to $27.7 billion. This is the fourth straight quarterly sales decline for the company. IBM's System and Technology Group reported a revenue drop of more than 26 percent to $4.26 billion during the quarter.
IBM CFO Martin Schroeter admitted there were "business model issues in parts of our hardware business" in a conference call with investors. Schroeter also expected a $1 billion "workforce rebalancing charge" in the first quarter, which could signify significant layoffs.