IBM generated $84 billion in total revenue over the past year. Expenses accounted for 79% of revenue at $65.9 billion, while taxes were another 4% at $3.6 billion. This left IBM with a net income of $14.3 billion, from which it paid $4.8 billion in dividends and repurchased $3.6 billion of its own stock. The remaining funds were retained by the company.

1. IBM's Billions
How Big Blue spends its revenue

2. $84billionIBM's revenue (ttm)

3. $100 billion
$84 billion$78 billion
Slovak RepublicIBMOman
If IBM were a country...

4. The S&P 500 Companies, Ranked by Revenue
IBM:
29th
$500
Billion

5. Not all of this falls to the bottom line.

6. 79%
Where does IBM's revenue go?
$84
Billion
Expenses ate up $65.9 billion.$65.9 billion

7. Where does IBM's revenue go?
79%
4%
$84
Billion
Taxes accounted for another $3.6 billion.$3.6 billion

8. Where does IBM's revenue go?
79%
4%
17%
$84
Billion
Leaving net income of $14.3 billion

9. Where does IBM's revenue go?
79%
4%
6%
17%
$84
Billion
From this, it paid dividends totaling $4.8 billion

10. Where does IBM's revenue go?
79%
4%
6%
4%
17%
$84
Billion
And bought back common stock worth $3.6 billion

11. Where does IBM's revenue go?
79%
4%
6%
4%
7%
17%
$84
Billion
And retained the rest…

12. Interesting
observations3

13. First, IBM pays out a smaller share of its annual
earnings than many other major companies do.
0%
20%
40%
60%
80%
100%
JNJ XOM INTC AAPL WFC WMT IBM
Dividends Buybacks Retained Earnings
How 7 Companies Allocate Their Earnings (ttm)

14. Second, IBM enjoys wider profit margins
than the typical large cap stock.
19%
IBM's pretax
operating margin (ttm)
17%
Median pretax operating
margin of the 100 biggest
S&P 500 companies (ttm)

15. 0%
200%
400%
600%
800%
1,000%
1,200%
1,400%
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
IBM's
stock
S&P 500
Which, third,
helps explain…

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