IBM, a multinational technology company, has successfully transitioned its business structure from a hardware business to software solution businesses like hybrid cloud computing and artificial intelligence (AI) in 2022; according to the head of its Korean unit, this trend will continue to intensify.
According to Won Sung-shik, country general manager of IBM Korea during a press conference in Seoul, based on a modified business portfolio, the software service and solution businesses increased to account for 70% of their total revenue in 2022, and they want to maintain this growth this year.
IBM reported sales of $60.5 billion in 2022, an increase of 6% from the previous year. Particularly, the company’s hybrid cloud business saw a gain in revenues of 11% to $22.4 billion, demonstrating that the company’s core business activities are now focused on software-related ventures.
Won said that customers won’t be familiar with IBM’s portfolio adjustment. Because they attempted to make a quick shift and the Korean market also underwent a similar amount of transformation the previous year, almost 70% of the revenue was earned from software solution services.
The infrastructure sectors, including cybersecurity, consulting, and data management and automation software for hybrid cloud computing and AI, particularly experienced growth in the Korean market. A hybrid cloud is a system that mixes private and public cloud services, allowing users to choose the most affordable option.
“Our growth strategy is to become a leader in hybrid cloud computing and AI. As more companies are making their transition to the cloud computing system, we estimate 30 percent to 40 percent of them are operating their system on hybrid cloud and multi-cloud systems. These changes create needs for a number of essential technologies and we have shifted the direction of our business to help customers transition to digital with our services and technology,” said Won.
Won gave examples of private and public companies, including KEPCO and the Korea Meteorological Administration, as well as state-run businesses, including Hyundai Marine & Fire Insurance and Samsung Electro-Mechanics, to illustrate how IBM Korea assisted Korean businesses in undergoing digital transformation.