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IBM's Rometty: Focusing on high growth, won't forget core

Rometty: IBM a high value innovation company

IBM is firmly focused on investing in high growth businesses, the company's chief executive said Thursday.

IBM CEO Ginni Rometty spoke with CNBC at the company's annual investor meeting in New York, just after the tech giant's management outlined a plan to pump up its business by doubling down on higher-value products and services.

"We are a high value innovation company," Rometty said, boasting regular double-digit growth in its cloud, analytics, mobile, social, and security businesses.

Despite the announcements, IBM shares traded down more than 1 percent Thursday midday.

Virginia 'Ginni' Rometty, CEO, IBM
Andrew Harrer | Bloomberg | Getty Images

IBM said it plans to shift $4 billion in spending to its "strategic imperatives" in 2015. With these investments, revenue from these areas will reach an expected $40 billion by 2018, representing more than 40 percent of overall revenue, according to the company.

In 2014, these businesses only generated $25 billion in revenue.

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But as the company focuses on high growth sectors, in will not forget its core business interests, Rometty said.

"We run the critical systems for the world," she said. "Those are high value, though the market is not growing in those, so we are not counting on that."

IBM shares declined nearly 15 percent last year, but have seen modest gains so far in 2015.

Revenue at IBM has gradually shrunk over the past three years as it sold off its unprofitable units in businesses such as low-end servers, semiconductors and cash registers.

Rometty has said she was happy to jettison revenue from such unprofitable businesses, which she dubs "empty calories."

Read More IBM CFO: Feeling good despite disappointing outlook

IBM revenue has now fallen for the past 11 quarters, while earnings growth has been sporadic.

The company says its long-term plan is to hit "low single-digit" revenue growth and "high single-digit" growth in operating earnings per share. Last year IBM withdrew its long-term plan to hit $20 per share in operating earnings for 2015.

The IBM chief also addressed the company's partnerships, telling CNBC that she "couldn't be happier" about its work with Apple to develop apps. By the end of this quarter, IBM will have released its first 25 iOS apps, she said.

—CNBC's Josh Lipton and Reuters contributed to this report.

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