The International Business Machines Corp. said Thursday it plans to earn $40 billion from the cloud and other growing parts of the tech industry by 2018. To help it transition into more profitable products and services like security and big data, IBM plans to spend $4 billion on its cloud, analytics and security businesses this year.
IBM executives unveiled the plan to convince investors it could shift towards more future-proof businesses at an annual investors meeting on Thursday in New York, according to Reuters. The Armonk, New York-based computing giant’s revenue has dragged over the last two years, largely due to by slow sales of its hardware.
Big Blue's stock fell two percent in 2013, making it the only company featured in the Dow Jones Industrial to lose value. In 2014, IBM stock fell 15 percent. Wall Street has been kinder to IBM this year, as its stock is up 1.5 percent.
With its $4 billion investment, IBM says it plans to increase revenue from growing areas like cloud computing to $40 billion by 2018. The categories, including big data and Bluemix mobile business, generated IBM less than $25 billion last year, with $7 billion coming from the cloud.
IBM’s revenue has fallen for the past three years, as the 104-year-old company shrugs off declining aspects of its business including cash registers and semiconductors. CEO Ginni Rometty said she was glad to drop revenue, or “empty calories,” from failing businesses.