IBM Profit Margins Shrink Again in Shift to Cloud Computing

International Business Machines Corp. said profit margins shrank for the fourth quarter in a row, underscoring the technology company’s challenge in shifting to more subscription-based software and cloud services.

Since Chief Executive Officer Ginni Rometty took the top post in 2012, investors have been waiting for her to turn the computer services company around and find growth in newer businesses -- like cloud and artificial intelligence -- to offset declines in legacy hardware, software and services units. The move is taking longer than some investors would like. IBM has been spending more on infrastructure and development, as well as on acquisitions, which has dented profitability in recent quarters. The company now has 49 data centers, having added two new ones in the third quarter in South Korea and Norway, Chief Financial Officer Martin Schroeter said on a conference call.