A $320 million charge to cover the settlement of pensions litigation dented third quarter net income at IBM.
But the largest technology company still managed to increase earnings per share by 4 per cent to $1.02, or 15 per cent to $1.07 excluding the charge.
IBM shares rose 2.3 per cent after-hours as the company said full-year earnings would top Wall Street estimates, indicating that fourth-quarter profit would be better than expected.
Third-quarter net income rose to $1.80 billion, or $1.06 per share, from $1.79 billion, or $1.02 per share, a year-earlier.
Net revenue rose 9 per cent to $23.4 billion, in line with Wall Street forecasts. Excluding the benefit of the weak dollar, which boosts the value of overseas sales when they are converted into dollars, revenue grew 5 per cent.
Excluding the pension charges, IBM recorded a third-quarter operating profit of $1.17 cents a share.
Chief financial officer Mr Mark Loughridge said that firming demand among customers is helping IBM shrug off economic shocks such as higher oil prices and technology pricing pressures.