Can the Hybrid Cloud Market Generate Fresh Growth for IBM?
IBM's (NYSE: IBM) recently emerged after the tech champion posted his second profit. The rally may have surprised some investors, as its quality numbers were weak. IBM's revenue dropped by 5% a year to $ 18.1 billion, although it still exceeded expectations of $ 400 million. Earnings were converted by 31 percent to $ 2.18 per share, although they also increased rates by nine cents.
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It would seem that IBM has recently pulled the bar down, which had been put down to deal with the COVID-19 disaster. But the other three facts seem like bears.
Three cloud images depicting public, hybrids and private clouds.
Image Source: Getty Images.
First, IBM’s cloud revenue has increased by 30% annually, with a 17% growth rate at Red Hat, and is faster than the 19% cloud revenue growth in the first quarter. Second, its large maross is increasing every year as the expansion of its cloud and Red Hat platforms increases its quality, productivity, and efficiency.
Finally, investors seem to be reassured by CEO Arvind Krishna’s focus on the “pure cloud” market, which he said repeatedly during the entire IBM conference. Let’s take a look at what a hybrid cloud really is, and why Krishna believes it could open up new growth opportunities for IBM.
What is a hybrid cloud?
There are three major types of cloud platforms: private, public, and hybrid. Independent clouds store company data on local servers, while public cloud services - such as Amazon (NASDAQ: AMZN) Web Services (AWS) and Microsoft (NASDAQ: MSFT) Azure - keep that data remotely.
Many large companies store their data in a private cloud so that they can access it quickly and securely. It also costs and takes time to submit all company information using the public cloud.
Hybrid clouds allow companies to separate their data between private and public clouds. For example, a company may store its most recent data on private servers while transferring its old data to a public cloud, and use its cloud services to analyze its local and remote data. These sets are often flexible, expensive, and easy to measure in large companies.
The global hybrid cloud market could grow from $ 45.7 billion to $ 128 billion between 2019 and 2025, according to Mordor Intelligence, and IBM believes it will contribute to that growth.
Understanding IBM's hybrid cloud plans
IBM servers and mainframes are widely used in private clouds. However, IBM's social platform is a bit tedious compared to AWS, Azure, Cloud Alibaba, and Alphabet's Google Cloud.
Server data center.
Image Source: Getty Images.
IBM does not plan to move forward with opponents of community cloud leaders. Instead, he introduced a new hybrid cloud deployment to his private cloud clients. IBM's hybrid cloud platform, which is growing exponentially with its Red Hat acquisition, uses open source software, so it works perfectly with AWS, Azure, and other leading public cloud services.
When Arvind Krishna took the plunge earlier this year, he said he would lead the Big Blue "on a journey of change" across cloud and AI markets related to cloud computing. To do this, Krishna wants IBM to link private and public clouds with an open source framework, which can provide a basis for selling other services.
IBM's hybrid cloud platform offers a variety of technologies - including Watson analytics, encryption services, and Internet of Things (IoT) tools - that pull data across all private and public cloud platforms. That submission could increase IB15's z15 mainframes sales, offering more hybrid cloud features, to local data centers.
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