International Business Machines, abbreviated IBM and

nicknamed "Big Blue", is a multinational computer technology

and IT consulting corporation headquartered in Armonk, New

York, United States. The company is one of the few information

technology companies with a continuous history dating back to

the 19th century. IBM manufactures and sells computer

hardware and software (with a focus on the latter), and offers

infrastructure services, hosting services, and consulting services

in areas ranging from mainframe computers to

nanotechnology.[1] Ginni Rometty is the president and CEO of

IBM.

IBM has been well known through most of its recent history as

one of the world's largest computer companies and systems

integrators.[2] With over 433,362 (2012) employees worldwide,

IBM is one of the largest and most profitable information

technology employers in the world.[3] IBM holds more patents

than any other U.S. based technology company and has eleven

research laboratories worldwide.[4] The company has scientists,

engineers, consultants, and sales professionals in over 170

countries.[5] IBM employees have earned five Nobel Prizes, four

Turing Awards, five National Medals of Technology, and five

National Medals of Science.[6]

International Business Machines Corporation

Logo used since 1972.

Type Public

Traded as

NYSE: IBM

Dow Jones Industrial Average

Component

S&P 500 Component

Industry Computer hardware, Computer

software, IT services, IT consulting

Founded Endicott, New York, U.S.

(June 16, 1911 (102 years ago))

Founder(s) Thomas J. Watson

Charles Ranlett Flint

Headquarters Armonk, New York, U.S.

Area served Worldwide

Key people Ginni Rometty

(Chairman, President, and CEO)

Products See IBM products

Revenue US$ 104.5 billion (2012)[1]

Operating

income

US$ 21.90 billion (2012)[1]

Net income US$ 17.60 billion (2012)

[1]

Total assets US$ 119.21 billion (2012)

[1]

Total equity US$ 18.86 billion (2012)

[1]

Employees 434,246 (December 31, 2012)[2]

Divisions

Financing, Hardware, Services,

Software

Website IBM.com

Corporate affairs IBM's headquarters complex is located in Armonk, Town of

North Castle, New York, United States. The 283,000-square-

foot (26,300 m2) IBM building has three levels of custom

curtain wall. The building is located on a 25-acre (10 ha) site.

IBM has been headquartered in Armonk since 1964. The

company has twelve research labs worldwide—Almaden,

Austin, Australia, Brazil, China, Dublin, Israel, India, Tokyo,

Watson (New York), Zurich and Nairobi—with Watson

(dedicated in 1961) serving as headquarters for the research

division and the site of its annual meeting. Other campus

installations include towers in Montreal, Paris, and Atlanta;

software labs in Raleigh-Durham, Rome and Toronto; buildings

in Chicago, Johannesburg, and Seattle; and facilities in

Hakozaki and Yamato. The company also operates the IBM

Scientific Center, Hursley House, the Canada Head Office

Building, IBM Rochester, and the Somers Office Complex. The

company's contributions to architecture and design, including

Chicago's 330 North Wabash building designed by Ludwig Mies

van der Rohe, were recognized with the 1990 Honor Award

from the National Building Museum.

BOARD OF DIRECTORS

IBM's Board of Directors, with 14 members, is responsible for

the overall management of the company. With Cathie Black's

resignation from the board in November 2010, the remaining 13

members (along with their affiliation and year of joining the

board) are as follows: Alain J. P. Belda '08 (Alcoa), William R.

Brody '07 (Salk Institute / Johns Hopkins University), Kenneth

Chenault '98 (American Express), Michael L. Eskew '05 (UPS),

Shirley Ann Jackson '05 (Rensselaer Polytechnic Institute),

Andrew N. Liveris '10 (Dow Chemical), W. James McNerney,

Jr. '09 (Boeing), James W. Owens '06 (Caterpillar), Samuel J.

Palmisano '00 (IBM), Joan Spero '04 (Doris Duke Charitable

Foundation), Sidney Taurel '01 (Eli Lilly), and Lorenzo Zambrano '03

(Cemex)

Various IBM facilities

IBM Rochester (Minnesota), nicknamed the "Big

Blue Zoo"

IBM Avenida de América Building in Madrid, Spain

Somers (New York) Office Complex, designed by

I.M. Pei

Corporate recognition and brand

In 2012, Fortune ranked IBM the No. 2 largest U.S. firm in terms of number of

employees the No. 4 largest in terms of market capitalization, the No. 9 most

profitable, and the No. 19 largest firm in terms of revenue. Globally, the company

was ranked the No. 31 largest firm in terms of revenue by Forbes for 2011. Other

rankings for 2011/2012 include the following:[

No. 1 company for leaders (Fortune)

No. 1 green company worldwide (Newsweek)[46]

No. 2 best global brand (Interbrand)

No. 2 most respected company (Barron's)[47]

No. 5 most admired company (Fortune)

No. 18 most innovative company (Fast Company)

For 2012, IBM's brand was valued by Interbrand at $75.5 billion.[48]

Research and inventions

In 1945, The Watson Scientific Computing Laboratory was founded at Columbia

University in New York, New York. The renovated fraternity house on Manhattan's

West Side was used as IBM's first laboratory devoted to pure science. The lab was

the forerunner of IBM's Research Division, which today operates research

facilities around the world.

In 1966, IBM researcher Robert H. Dennard invented Dynamic Random Access

Memory (DRAM) cells, one-transistor memory cells that store each single bit of

information as an electrical charge in an electronic circuit. The technology permits

major increases in memory density and is widely adopted throughout the industry

where it remains in widespread use today.

IBM has been a leading proponent of the Open Source Initiative, and began

supporting Linux in 1998.[62]

The company invests billions of dollars in services

and software based on Linux through the IBM Linux Technology Center, which

includes over 300 Linux kernel developers.[63]

IBM has also released code under

different open source licenses, such as the platform-independent software

framework Eclipse (worth approximately US$40 million at the time of the

donation),[64]

the three-sentence International Components for Unicode (ICU)

license, and the Java-based relational database management system (RDBMS)

Apache Derby. IBM's open source involvement has not been trouble-free, however

(see SCO v. IBM).

Famous inventions by IBM include the following:

Automated teller machine (ATM) Floppy disk Hard disk drive Electronic keypunch Magnetic stripe card Virtual machine Scanning tunneling microscope Reduced instruction set computing Relational database Universal Product Code (UPC) Financial swap SABRE airline reservation system Dynamic Random Access Memory (DRAM) Watson artificial intelligence

IBM Corp.

Profit & Loss Year Ended 31 December 2012 2011 2010 2009 2008

$ millions

Turnover 104507.0 106916.0 99870.0 95758.0 103630.0

Operating Profit 22361.0 21414.0 20091.0 18540.0 17388.0

Net Interest -459.0 -411.0 -368.0 -402.0 n/a

Profit Before Tax 21902.0 21003.0 19723.0 18138.0 16715.0

Profit After Tax 16604.0 15855.0 14833.0 13425.0 12334.0

Total Dividend n/a n/a n/a n/a n/a

Retained Profit / Loss n/a n/a n/a n/a n/a

Balance Sheet Year Ended 31 December 2012 2011 2010 2009 2008

$ millions

Intangible Assets 33034.0 29605.0 28624.0 22703.0 21104.0

Tangible Assets 13996.0 13883.0 14096.0 14165.0 14305.0

Fixed Investments 5021.0 4895.0 5778.0 5379.0 n/a

Total Fixed Assets 69780.0 65505.0 65334.0 60087.0 60520.0

Stocks 2287.0 2595.0 2450.0 2494.0 2701.0

Debtors n/a n/a n/a n/a n/a

Cash at Bank and in Hand 10412.0 11922.0 11651.0 12183.0 12741.0

Total Assets 119213.0 116433.0 113450.0 109024.0 109524.0

Creditors Amount Within 1 year 34444.0 33660.0 33784.0 31835.0 31199.0

Creditors Amount After 1 year 32516.0 31217.0 27870.0 28334.0 30815.0

Total Liabilities 100229.0 96197.0 90278.0 86269.0 95939.0

Net Assets 18984.0 20236.0 23172.0 22755.0 13585.0

Net Current Assets n/a n/a n/a n/a n/a

Called Up Share Capital 50110.0 48129.0 45418.0 41810.0 n/a

Share Premium Account n/a n/a n/a n/a n/a

Other Reserves -148890.0 -132847.0 -114904.0 -100073.0 n/a

Profit and Loss Account 117640.0 104857.0 92532.0 80900.0 n/a

Shareholders Funds 18860.0 20139.0 23046.0 22637.0 13465.0

Minority Interests 124.0 97.0 126.0 118.0 120.0

Key Figures

Year Ended 31 December 2012 2011 2010 2009 2008

Earnings Per Share Basic USD 0.01 0.01 0.01 0.01 9.02

Earnings Per Share Diluted USD 0.01 0.01 0.01 0.01 n/a

Earnings Per Share Adjusted USD 0.01 0.01 0.01 0.01 9.02

Earnings Per Share Growth (%) 10 13 16 12 23

Total Dividend USD 2.55 3.00 2.60 2.20 2.00

Operating Margin (%) 21 20 20 19 17

ROCE (%) 116 98 87 71 63

Dividend Cover 5.70 4.42 4.50 4.60 4.51

Dividend Yield 1.40 1.60 1.80 n/a 1.10

Price / Earnings Ratio 12.90 14.20 12.50 n/a 20.90

Dividend Per Share Growth (%) -15 15 18 10 33

Annual Financials for International Business

Machines Corp. Fiscal year is January-December. All values USD

millions. 2008 2009 2010 2011 2012

5-year

trend

Sales/Revenue 103.63B 95.76B 99.87B 106.92B 104.51B

Cost of Goods Sold (COGS) incl. D&A 58.6B 52.38B 54.19B 57.04B 54.67B

COGS excluding D&A 53.15B 47.39B 49.36B 52.22B 49.99B

Depreciation & Amortization Expense 5.45B 4.99B 4.83B 4.82B 4.68B

Depreciation 4.14B 3.77B 3.66B 3.59B 3.39B

Amortization of Intangibles 1.31B 1.22B 1.17B 1.23B 1.28B

Gross Income 45.03B 43.38B 45.68B 49.88B 49.84B

2008 2009 2010 2011 2012

5-year

trend

SG&A Expense 28.36B 26.2B 27.03B 29.11B 28.87B

Research & Development 6.02B 5.82B 6.03B 6.26B 6.3B

2008 2009 2010 2011 2012

5-year

trend

Other SG&A 22.34B 20.38B 21B 22.85B 22.57B

Other Operating Expense 0 0 0 0 0

Unusual Expense 711M 50M (84M) 144M 571M

EBIT after Unusual Expense (711M) (50M) 84M (144M) (571M)

Non Operating Income/Expense 1.08B 1.41B 1.37B 764M 1.96B

Non-Operating Interest Income 343M 107M 92M 136M 109M

Equity in Affiliates (Pretax) 0 - - - -

Interest Expense 673M 498M 474M 519M 558M

Gross Interest Expense 688M 511M 479M 528M 576M

Interest Capitalized 15M 13M 5M 9M 18M

Pretax Income 16.72B 18.14B 19.72B 21B 21.9B

Income Tax 4.38B 4.71B 4.89B 5.15B 5.3B

Income Tax - Current Domestic 554M 593M 469M 697M 1.5B

Income Tax - Current Foreign 1.93B 2.35B 3.13B 3.24B 3.01B

Income Tax - Deferred Domestic 1.47B 1.53B 1.23B 990M 692M

Income Tax - Deferred Foreign 432M 247M 69M 222M 105M

Income Tax Credits 0 0 0 0 0

Equity in Affiliates 0 0 0 0 0

Other After Tax Income (Expense) - 0 0 0 0

Consolidated Net Income 12.33B 13.43B 14.83B 15.86B 16.6B

Minority Interest Expense 0 0 0 0 0

2008 2009 2010 2011 2012

5-year

trend

Net Income 12.33B 13.43B 14.83B 15.86B 16.6B

Extraordinaries & Discontinued Operations 0 0 0 0 0

Extra Items & Gain/Loss Sale Of Assets 0 0 0 0 0

Cumulative Effect - Accounting Chg - 0 0 0 0

Discontinued Operations 0 0 0 0 0

Net Income After Extraordinaries 12.33B 13.43B 14.83B 15.86B 16.6B

Preferred Dividends 0 0 0 0 0

Net Income Available to Common 12.33B 13.43B 14.83B 15.86B 16.6B

EPS (Basic) 9.01 10.12 11.69 13.25 14.53

Basic Shares Outstanding 1.37B 1.33B 1.27B 1.2B 1.14B

EPS (Diluted) 8.89 10.01 11.52 13.06 14.37

Diluted Shares Outstanding 1.39B 1.34B 1.29B 1.21B 1.16B

EBITDA 22.13B 22.17B 23.49B 25.58B 25.64B

MAJOR SHAREHOLDERS

Breakdown % of Shares Held by All Insider and 5% Owners: 0%

% of Shares Held by Institutional & Mutual Fund

Owners: 60%

2008 2009 2010 2011 2012

5-year

trend

% of Float Held by Institutional & Mutual Fund

Owners: 60%

Number of Institutions Holding Shares: 1750

Major Direct Holders

Holder Shares Reported

PALMISANO

SAMUEL J

285,107 Aug 16, 2012

MILLS STEVEN A 144,470 May 7, 2013

ROMETTY

VIRGINIA M

24,429 Feb 19, 2013

DANIELS MICHAEL

E

107,871 Feb 1, 2013

LEBLANC ROBERT

J.

51,400 Feb 15, 2013

Top Institutional Holders

Holder Shares % Out Value* Reported

Berkshire Hathaway, Inc 68,121,984 6.22 13,018,792,362 Jun 30, 2013

State Street Corporation 60,541,885 5.53 11,570,159,642 Jun 30, 2013

Vanguard Group, Inc. (The) 54,608,801 4.99 10,436,287,959 Jun 30, 2013

BlackRock Institutional Trust

Company, N.A. 27,496,733 2.51 5,254,900,643 Jun 30, 2013

State Farm Mutual Automobile

Insurance Co 16,651,892 1.52 3,182,343,080 Jun 30, 2013

Northern Trust Corporation 16,317,160 1.49 3,118,372,447 Jun 30, 2013

Bank of New York Mellon

Corporation 15,377,793 1.40 2,938,850,020 Jun 30, 2013

BlackRock Fund Advisors 10,562,286 0.96 2,018,558,477 Jun 30, 2013

Wellington Management Company, 10,471,466 0.96 2,001,201,867 Jun 30, 2013

2008 2009 2010 2011 2012

5-year

trend

LLP

Norges Bank Investment

Management 9,100,412 0.83 1,743,183,918 Dec 31, 2012

Top Mutual Fund Holders

Holder Shares % Out Value* Reported

Vanguard Total Stock Market Index

Fund 15,742,070 1.44 3,008,466,997 Jun 30, 2013

Vanguard 500 Index Fund 9,982,835 0.91 1,907,819,596 Jun 30, 2013

Vanguard Institutional Index Fund-

Institutional Index Fund 9,906,435 0.90 1,893,218,792 Jun 30, 2013

SPDR S&P 500 ETF Trust 9,560,038 0.87 1,742,508,126 Aug 31, 2013

SPDR Dow Jones Industrial Average

ETF 5,974,574 0.55 1,088,985,602 Aug 31, 2013

Vanguard/Wellington Fund Inc. 5,038,680 0.46 1,048,146,213 May 31, 2013

Vanguard Growth Index Fund 5,060,289 0.46 967,071,830 Jun 30, 2013

Spartan 500 Index Fund 4,291,020 0.39 782,124,215 Aug 31, 2013

Select Sector SPDR Fund-

Technology 3,906,959 0.36 712,121,416 Aug 31, 2013

Vanguard Specialized-Dividend

Appreciation Index Fund 3,617,533 0.33 705,563,636 Jul 31, 2013

FUTURE PLANS

IBM Developer Kits are made available with IBM Products such

as AIX, zOS, and WebSphere. In addition, for the various Linux

platforms, we intend to distribute the IBM Developer Kits with

the leading Linux distributions on each platform. For each

platform where the IBM Developer Kit is not available with a

distribution, IBM will provide alternative access.

The most recent JSE technology from IBM is the 7 level. Our

implementation of version 7 includes significant functional

enhancements as well as upgraded Java Virtual Machine and

Just-In-Time (JIT) compiler capabilities.