IBM posted quarterly earnings and revenues above analyst estimates on Thursday, as cloud sales popped 33 percent.
But the iconic New York–based enterprise technology company has now suffered 19 straight quarters of declining year-over-year total revenues.
The company posted adjusted earnings per share on Thursday of $5.01, excluding items, and revenues of $21.77 billion. Wall Street expected IBM to report earnings of $4.88 a share on revenue of $21.64 billion in the fiscal fourth quarter, according to a Thomson Reuters consensus estimate.
Shares briefly rose as much as 3 percent in extended trading, before paring gains, last down more than 2 percent.
While earnings per share rose 4 percent from a year ago, revenues were down 1 percent, the company said. IBM's revenue has decline from the year-ago quarter since April 2012, when sales were nearly flat.
The company has mounted an uneasy transition away from operating systems and equipment, and toward "strategic imperatives" like business services, artificial intelligence and cloud.
"In 2016, our strategic imperatives grew to represent more than 40 percent of our total revenue and we have established ourselves as the industry's leading cognitive solutions and cloud platform company," Ginni Rometty, IBM chairman, president and chief executive officer, said in a statement.
Cognitive solutions hit a revenue of $5.3 billion for the quarter, compared to the $5.38 billion expected by StreetAccount estimates. Business services hit revenue of $4.1 billion, compared to StreetAccount expectations of $4.23 billion. And technology services and cloud platforms hit $9.3 billion, above the $9.16 billion estimates in StreetAccount.
IBM's cloud, and its artificially intelligent assistant, Watson, have hit some major milestones over the last few months. IBM's cloud now powers the U.S. Army, while Watson is in a new car infotainment system.
Investors were searching for signals in the financial guidance that IBM will soon turn a corner. For the coming year, IBM said it expects $13.80 adjusted earnings per share, above the $13.48 per share expected by a Thomson Reuters consensus estimate.
"For IBM it's really going to be about it was the turnaround for a really long time, and it's still continuing, but we need to start to see it bear fruit," Lindsey Bell, an investment strategist at CFRA Research, told CNBC's "Closing Bell" on Thursday. "People were like, 'Ok, you've got turnaround plans, the stock can go higher, but what's that going to mean for revenue? Can we start seeing revenue turnaround and start to grow?'"
The end of the company's fiscal year will also mark the release of its annual report, which reveals the number of employees it had during the year. CEO Rometty has revealed ambitions to hire about 25,000 American professionals in the next four years in the United States, 6,000 of those in 2017.
While the company's net employment has inched up 50,000 over the last decade, divestitures over the past couple of years have taken their toll: In its latest annual report, for 2015, IBM said its workforce totaled 377,757, down by 53,455 from 2013.
One person that's betting in favor of the company is Warren Buffett. The billionaire investing guru has accumulated a nearly 8.6 percent stake in the company since he started buying shares in 2011.
Buffett likes the stock because he said IBM has a "stickiness" within corporate IT departments, and is the best of big companies when it comes to laying out a road map. The company has not missed a quarterly dividend payment since 1916, and has doubled its dividend since 2010, it said.
Shares briefly hit $171 in extended trading on Thursday, above the $170.43 per share, Buffett needed beat his average price paid per share.
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— CNBC's Deirdre Bosa and Natalia Wojcik, contributed to this report.