Tech giant IBM has reported its 2006 first-quarter results, showing revenue of $20.7 billion, in line with expectations, and a profit of $1.7 billion, highlighting its video game console chipset business in its microelectronics division as one of the highlights for the company's growth.
The company has worked with Sony and Toshiba to co-produce the Cell technology being used in the PlayStation 3, and has provided the PowerPC-based CPU multi-core processor architecture for Microsoft's Xbox 360. In addition, IBM has also worked with Nintendo to create the CPU, codenamed Broadway, for the forthcoming Revolution console, meaning that the firm will have a share in revenue for all three next-gen consoles.
Samuel J. Palmisano, IBM chairman and chief executive officer, commented of the results: "IBM had a good quarter with excellent earnings-per-share results... Our performance underscores the strength of our business model across a balanced portfolio of software, services and hardware, and demonstrates the benefits of the strategic actions we've taken in recent years to reposition the company."
He particularly noted: "We had very strong results in middleware and continued revenue growth in microelectronics for our 300-millimeter wafer products that serve the major gaming platforms." The company's shares surged almost $2 following the earnings announcement on Tuesday, but were back down in Wednesday trading to $81.28, somewhat below a 52-week high of $89.94.