Key Performance Metrics

  • The review of Net Profit Margin witnessed a fluctuating trend. The Net Profit Margin declined from 16.34% in 2019 to 12.13% in 2023.
  • The average EBIT Margin for the period under analysis was 12.26%, with 2022 and 2019 performing the worst and best, respectively.
  • In the current year, IBM was able to cover its interest liabilities 6.40 times in the current year- compared to 2019 when it was 8.06 times.
  • The Asset turnover stood at 0.47 times in 2023 from 0.39 in 2019, implying a low performance on Assets of the business in relation to revenue.


  • The revenue of IBM has fluctuated year on year. The revenue decreased by 4.39% between 2019 and 2020 and a further 5.54% increase was recorded between 2021 and 2022. There also occurred an increase of 2.20% between 2022 and 2023 (the current period).
  • IBM’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.


  • The company’s result in liquidity looks poor, as current ratio/acid test decreased from 1.02:1/0.98:1 to 0.96:1/0.96:1 on the last year. Which implies that the company does not have enough assets to settle its current liabilities.

Capital Structure

  • IBM is both equity and debt financed.
  • The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be high as it stood at 2.66 in the current year.

Source: IBM Annual Report

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