IBM sales grow again after a year of decline due to the strength of the cloud business

International Business Machines (NYSE: IBM ) Corp on Monday returned first-quarter sales growth after a year of declines and beat Wall Street forecasts, buoyed by its bets on the lucrative cloud computing business.

Shares of the Dow Jones component , which have gained nearly 6% so far this year, were up more than 4% in after-hours trading on Wall Street.

Chief Financial Officer James Kavanaugh said cloud spending by clients in the U.S. retail, manufacturing and travel industries was recovering after an initial drop caused by the pandemic.

Sales of its cloud computing services rose 21% to $6.5 billion in the quarter. The 109-year-old firm is preparing to split into two public limited companies.

Total revenue rose nearly 1% to $17.73 billion in the quarter, beating analysts’ average estimate of $17.35 billion, according to IBES data from Refinitiv.

Earnings fell to $955 million, or $1.06 a share, in the quarter ended March 31, from $1.18 billion, or $1.31 a share, a year earlier.

Excluding items, the company earned $1.77 per share, beating market expectations of $1.63.

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