International Business Machine Corp., widely called as IBM, the Armonk, New York-headquartered American multinational tech conglomerate, said in a statement on Thursday that the company had been exploring an option to spin off a $19 billion chuck of its business in a bid to focus more on cloud computing and artificial intelligence.
Aside from that, the 109-year-old tech conglomerate that had sidestepped its computer hardware business back in the 2005s and started off supplying software for a raft of big-league businesses, governments alongside other organizations, had also stated earlier in the day that the Armonk-based tech conglomerate was looking to a spin-off of its infrastructure services into a new public company, named as NewCo, while the split was expected to take effect by late-2021.
IBM breaks off 109-year-old business in push for AI, cloud computing
In point of fact, latest statement from the American multinational tech mogul came forth as it had been scuffling to grapple with a highly congested cloud computing market, largely dominated by top cloud rivals likes of Microsoft Corp.’s Azure and Amazon.com Inc.’s Amazon Web Services (AWS), while the century-old tech conglomerate’s latest move to establish a $19 billion holding solely dedicated to manage its businesses infrastructure, would likely to help IBM allocate more resources on cloud computing and AI, eventually stepping up competitions.
Apart from that, followed by the IBM statement that was released earlier on Thursday, IBM Chief Executive Arvind Krishna was quoted saying that the spin-off would enable the American tech trailblazer to focus more on its cloud platform and AI, while the newly formed entity would manage its business infrastructure alongside other organizations.
Notably, IBM Chief Executive Krishna had told in April this year that the New York-based International Business Machine Corp., which had reported a $77.1 billion in annual revenues last year, would continue to erase services and software divisions that would fail to align themselves on IBM’s top two focus area for growth, artificial intelligence and cloud computing, however, analysts suggested a delayed cloud computing push from IBM would unlikely to stem a lucid upshot.