International Business Machines Corporation
Income Statement
For the Year Ended Dec. 31, 1998 ($ in millions)
	1996	1997	1998
Revenue:
Hardware Segment	$36,634	$36,630	$35,419
Global Services Segment	$22,310	$25,166	$28,916
Software Segment	$11,426	$11,164	$11,863
Global Financing Segment	$3,054	$2,806	$2,877
Enterprise Investments Segment /Other	$2,523	$2,742	$2,592
Total Revenue	$75,947	$78,508	$81,667
Costs:
Hardware Segment	$22,888	$23,473	$24,214
Global Services Segment	$16,270	$18,464	$21,125
Software Segment	$2,946	$2,785	$2,260
Global Financing Segment	$1,481	$1,448	$1,494
Enterprise Investments Segment /Other	$1,823	$1,729	$1,702
Total Costs	$45,408	$47,899	$50,795
Gross Profit	$30,539	$30,609	$30,872
Operating Expenses:
Selling , General and Administrative	$16,854	$16,634	$16,662
Research , Development and Engineering	$5,089	$4,877	$5,046
Total Operating Expenses	$21,943	$21,511	$21,708
Operating Income	$8,596	$9,098	$9,164
Other Income - Principally Interest	$707	$657	$589
Interest Expense	$716	$728	$713
Income Before Taxes	$8,587	$9,027	$9,040
Provision for Income Taxes	$3,158	$2,934	$2,712
Net Income	$5,429	$6,093	$6,328
Preferred stock Dividends	$20	$20	$20
Net Income Applicbale to Common Stockholders	$5,409	$6,073	$6,308
EPS basic	$5.12	$6.18	$6.75
EPS diluted	$5.01	$6.01	$6.57