| Revenue and Pre-tax Income by Segment |
| | | | | | | | | | | | | | | | | | | | | | Cloud & | | Global | | Global | | | | | | | | | | | | | Cognitive | | Business | | Technology | | | | | Global | | Total | | (Dollars in millions) | | Software | | Services | | Services | | Systems | | Financing | | Segments | | For the three months ended June 30, 2020: | | | | | | | | | | | | | | | | | | | | External revenue | | $ | 5,748 | | $ | 3,890 | | $ | 6,316 | | $ | 1,852 | | $ | 265 | | $ | 18,072 | | Internal revenue | | | 743 | | | 55 | | | 304 | | | 240 | | | 241 | | | 1,582 | | Total revenue | | $ | 6,491 | | $ | 3,945 | | $ | 6,621 | | $ | 2,092 | | $ | 506 | | $ | 19,655 | | Pre-tax income from continuing operations | | $ | 1,708 | | $ | 362 | | $ | 250 | | $ | 248 | | $ | 176 | | $ | 2,744 | | Revenue year-to-year change | | | 5.2 | % | | (7.5) | % | | (7.3) | % | | 8.7 | % | | (20.0) | % | | (2.4) | % | Pre-tax income year-to-year change | | | (14.9) | % | | 25.1 | % | | 6.4 | % | | 304.8 | % | | (26.2) | % | | (3.1) | % | Pre-tax income margin | | | 26.3 | % | | 9.2 | % | | 3.8 | % | | 11.8 | % | | 34.9 | % | | 14.0 | % | | | | | | | | | | | | | | | | | | | | | For the three months ended June 30, 2019: | | | | | | | | | | | | | | | | | | | | External revenue | | $ | 5,563 | * | $ | 4,197 | * | $ | 6,837 | | $ | 1,753 | | $ | 351 | | $ | 18,701 | * | Internal revenue | | | 607 | | | 69 | | | 302 | | | 171 | | | 281 | | | 1,430 | | Total revenue | | $ | 6,170 | * | $ | 4,266 | * | $ | 7,139 | | $ | 1,924 | | $ | 632 | | $ | 20,131 | * | Pre-tax income from continuing operations | | $ | 2,007 | * | $ | 290 | * | $ | 235 | | $ | 61 | | $ | 239 | | $ | 2,832 | * | Pre-tax income margin | | | 32.5 | %* | | 6.8 | %* | | 3.3 | % | | 3.2 | % | | 37.8 | % | | 14.1 | %* |
| | | | | | | | | | | | | | | | | | | | | | Cloud & | | Global | | Global | | | | | | | | | | | | | Cognitive | | Business | | Technology | | | | | Global | | Total | | (Dollars in millions) | | Software | | Services | | Services | | Systems | | Financing | | Segments | | For the six months ended June 30, 2020: | | | | | | | | | | | | | | | | | | | | External revenue | | $ | 10,987 | | $ | 8,027 | | $ | 12,783 | | $ | 3,220 | | $ | 564 | | $ | 35,581 | | Internal revenue | | | 1,556 | | | 101 | | | 599 | | | 388 | | | 453 | | | 3,096 | | Total revenue | | $ | 12,543 | | $ | 8,128 | | $ | 13,382 | | $ | 3,608 | | $ | 1,017 | | $ | 38,677 | | Pre-tax income from continuing operations | | $ | 2,641 | | $ | 633 | | $ | 72 | | $ | 31 | | $ | 370 | | $ | 3,747 | | Revenue year-to-year change | | | 4.7 | % | | (4.3) | % | | (6.4) | % | | 5.7 | % | | (24.0) | % | | (2.2) | % | Pre-tax income year-to-year change | | | (30.4) | % | | 7.8 | % | | (85.9) | % | | nm | | | (29.8) | % | | (29.0) | % | Pre-tax income margin | | | 21.1 | % | | 7.8 | % | | 0.5 | % | | 0.9 | % | | 36.4 | % | | 9.7 | % | | | | | | | | | | | | | | | | | | | | | For the six months ended June 30, 2019: | | | | | | | | | | | | | | | | | | | | External revenue | | $ | 10,530 | * | $ | 8,353 | * | $ | 13,711 | | $ | 3,081 | | $ | 757 | | $ | 36,432 | * | Internal revenue | | | 1,448 | | | 143 | | | 591 | | | 334 | | | 581 | | | 3,097 | | Total revenue | | $ | 11,978 | * | $ | 8,495 | * | $ | 14,303 | | $ | 3,415 | | $ | 1,338 | | $ | 39,529 | * | Pre-tax income/(loss) from continuing operations | | $ | 3,792 | * | $ | 587 | * | $ | 510 | | $ | (141) | | $ | 527 | | $ | 5,276 | * | Pre-tax income/(loss) margin | | | 31.7 | %* | | 6.9 | %* | | 3.6 | % | | (4.1) | % | | 39.4 | % | | 13.3 | %* |
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| Reconciliation of segment revenue and pre-tax income to IBM as reported |
Reconciliations to IBM as Reported: | | | | | | | | (Dollars in millions) | | | | | | | | For the three months ended June 30: | | 2020 | | 2019 | | Revenue: | | | | | | | | Total reportable segments | | $ | 19,655 | | $ | 20,131 | * | Other—divested businesses | | | 13 | | | 403 | * | Other revenue | | | 37 | | | 57 | | Eliminations of internal transactions | | | (1,582) | | | (1,430) | | Total consolidated revenue | | $ | 18,123 | | $ | 19,161 | | | | | | | | | | Pre-tax income from continuing operations: | | | | | | | | Total reportable segments | | $ | 2,744 | | $ | 2,832 | * | Amortization of acquired intangible assets | | | (472) | | | (169) | | Acquisition-related (charges)/income | | | (1) | | | (102) | | Non-operating retirement-related (costs)/income | | | (273) | | | (136) | | Eliminations of internal transactions | | | (121) | | | (60) | | Other—divested businesses | | | (22) | | | 561 | * | Unallocated corporate amounts | | | (283) | | | (156) | | Total pre-tax income from continuing operations | | $ | 1,571 | | $ | 2,768 | |
* Recast to conform to current period presentation. Reconciliations to IBM as Reported: | | | | | | | | (Dollars in millions) | | | | | | | | For the six months ended June 30: | | 2020 | | 2019 | | Revenue: | | | | | | | | Total reportable segments | | $ | 38,677 | | $ | 39,529 | * | Other—divested businesses | | | 32 | | | 780 | * | Other revenue | | | 81 | | | 131 | | Eliminations of internal transactions | | | (3,096) | | | (3,097) | | Total consolidated revenue | | $ | 35,694 | | $ | 37,342 | | | | | | | | | | Pre-tax income from continuing operations: | | | | | | | | Total reportable segments | | $ | 3,747 | | $ | 5,276 | * | Amortization of acquired intangible assets | | | (945) | | | (343) | | Acquisition-related (charges)/income | | | (2) | | | (141) | | Non-operating retirement-related (costs)/income | | | (538) | | | (274) | | Eliminations of internal transactions | | | (176) | | | (149) | | Other—divested businesses | | | 3 | | | 505 | * | Unallocated corporate amounts | | | (568) | | | (224) | | Total pre-tax income from continuing operations | | $ | 1,522 | | $ | 4,651 | |
* Recast to conform to current period presentation. nm - not meaningful
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