In January 2022, IBM announced the divestiture of its healthcare data and analytics assets which is expected to close in the second quarter of 2022. Refer to note 6, “Acquisitions & Divestitures,” for additional information. The company re-aligned its management structure to manage these assets outside of the Software segment prior to the divestiture. In the first quarter of 2022, the financial results of these assets are presented in Other–divested businesses. This change did not impact IBM’s Consolidated Financial Statements.

In the fourth quarter of 2021, immediately prior to the separation of Kyndryl, the company made a number of changes to its organizational structure and management system to align the company’s operating model to its platform-centric approach to hybrid cloud and AI. With these changes, the company revised its reportable segments, but did not impact its Consolidated Financial Statements. The below table displays the segment updates in the fourth quarter of 2021.

(1) Does not include minor mission moves.

(2) IBM completed the separation of its managed infrastructure services business to Kyndryl on November 3, 2021.

(3)	Represents a joint venture relationship that was historically managed by the managed infrastructure services business that was not transferred to Kyndryl as part of the separation.

The following tables reflect the results of continuing operations of the company’s segments consistent with the management and measurement system utilized within the company and have been recast for the prior-year periods to reflect the company’s segment changes in the first quarter of 2022 and the fourth quarter of 2021 described above. Performance measurement is based on pre-tax income from continuing operations. These results are used by the chief operating decision maker, both in evaluating the performance of, and in allocating resources to, each of the segments.

SEGMENT INFORMATION


													Total
(Dollars in millions)	Software			Consulting			Infrastructure			Financing			Segments
For the three months ended March 31, 2022:
Revenue	$	5,772		$	4,829		$	3,219		$	154		$	13,973
Pre-tax income from continuing operations	$	1,134		$	348		$	199		$	84		$	1,766
Revenue year-to-year change		12.3	%		13.3	%		(2.3)	%		(26.2)	%		8.3	%
Pre-tax income year-to-year change		72.3	%		25.8	%		(31.7)	%		(14.3)	%		33.3	%
Pre-tax income margin		19.7	%		7.2	%		6.2	%		54.6	%		12.6	%

*For the three months ended March 31, 2021:**
Revenue	$	5,138		$	4,262		$	3,293		$	208		$	12,902
Pre-tax income from continuing operations	$	658		$	277		$	292		$	98		$	1,325
Pre-tax income margin		12.8	%		6.5	%		8.9	%		47.0	%		10.3	%

Reconciliations to IBM as Reported:


(Dollars in millions)
For the three months ended March 31:	2022		2021*
Revenue:
Total reportable segments	$	13,973	$	12,902
Other ‒ divested businesses		154		197
Other revenue		70		87
Total consolidated revenue	$	14,197	$	13,187

Pre-tax income from continuing operations:
Total reportable segments	$	1,766	$	1,325
Amortization of acquired intangible assets		(461)		(447)
Acquisition-related (charges)/income		(7)		(16)
Non-operating retirement-related (costs)/income		(202)		(332)
Kyndryl-related impacts**		(222)		—
Eliminations of internal transactions		(11)		(9)
Other ‒ divested businesses		(52)		(15)
Unallocated corporate amounts and other		(188)		(262)
Total pre-tax income from continuing operations	$	623	$	244

*	Recast to conform to current year presentation.

**	Refer to note 8, “Financial Assets & Liabilities,” for additional information.