Despite Fortune ranking it among some of the top tech firms, International Business Machines’ (IBM) revenues have declined for ten consecutive years. During this period, IBM’s legacy businesses struggled, and the stock looked like the definition of a value trap. However, IBM could be on the cusp of a transformation. The spin-off of the managed infrastructure services division, a business that has weighed on results, will occur by year-end. Bulls believe that once the divestiture is complete, IBM’s cloud and block chain businesses will drive growth. What We Need To Know About The Spin-Off By the end of 2021, IBM will spin off a sizable portion of its managed infrastructure services business to focus on cloud computing. Currently referred to as “NewCo,” the divested assets provided $19 billion of IBM’s $72.5 billion in revenue in FY20. However, that $19 billion is the result of lower margin, slow growth businesses, and as such, IBM will have more
Operator
Welcome, and thank you for standing by. [Operator instructions] Today s conference is being recorded. If you have any objections, you may disconnect at this time. Now, I would like to turn the meeting over to Ms.
Patricia Murphy with IBM. Ma am, you may begin.
Patricia Murphy
Vice President, Finance and Operations
Thank you. This is Patricia Murphy, and I d like to welcome you to IBM s fourth-quarter 2020 earnings presentation. I m here with Arvind Krishna, IBM s chairman and chief executive officer; and Jim Kavanaugh, IBM s senior vice president and chief financial officer. We ll post today s prepared remarks on the IBM investor website within a couple of hours, and a replay will be available by this time tomorrow.