IBM posts earnings of $2.95 a share vs. $2.89 expected

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International Business Machines reported quarterly earnings and revenue that beat analysts' expectations on Monday.

The enterprise technology company posted fiscal-second-quarter earnings per share of $2.95, compared to $3.84 a share in the year-earlier period.

Revenue for the quarter came in at $20.24 billion, against the comparable year-ago figure of $20.81 billion. This quarter marks IBM's 17th straight quarterly decline in revenue.

Shares edged slightly higher in after-hours trading following the earnings report.

Analysts expected IBM to report earnings of $2.89 per share on revenue of $20.03 billion, according to a Thomson Reuters consensus estimate.

The earnings come as Big Blue, founded in 1911, continues its transition from a legacy technology company to the cloud. The company's data intelligence play, Watson, is branded as "cognitive," or artificial intelligence plus, and aims to add value compared with its cloud competitors.

"IBM Cloud grew 30 percent to $3.4 billion in the quarter, and over the trailing 12 months were $11.6 billion," according to the company's spokesperson. "So cloud is becoming more important to the overall IBM story—a sign of how the transformation is taking hold."

IBM said it is seeing benefits from increased R&D investments, including the close of 25 acquisitions in the past 18 months, mostly around what CEO Virginia Rometty dubs "strategic imperatives": cloud, analytics, security, and social and mobile technologies.

-CNBC's Anita Balakrishnan contributed to this report.