Job Cuts Expected for IBM as Revenue Growth Slows, According to Leading Financial Newsletter Profit Confidential

Share Article

Michael Lombardi, lead contributor to Profit Confidential, believes corporate revenue growth within the global economic slowdown is going to be very hard to come by for the remainder of 2012. So far, about 25% of all S&P 500 companies have reported their corporate earnings for the second quarter, Lombardi reports, noting sales have risen among these firms at the slowest rate since 2009, and IBM is just one of many that will rely on job cuts—not revenue growth—to increase corporate earnings.

Job Cuts Expected for IBM as Revenue Growth Slows, According to Leading Financial Newsletter Profit Confidential

Job Cuts Expected for IBM as Revenue Growth Slows, According to Leading Financial Newsletter Profit Confidential

If the big S&P 500 companies see their revenue growth stalling, they will cut expenses to achieve their projected corporate earnings; a cycle that puts further pressure on our economy—which I’m now believing cannot escape Recession Part II.

Past News Releases

RSS

Michael Lombardi, lead contributor to Profit Confidential, believes corporate revenue growth within the global economic slowdown is going to be very hard to come by for the remainder of 2012. So far, about 25% of all S&P 500 companies have reported their corporate earnings for the second quarter, Lombardi reports, noting sales have risen among these firms at the slowest rate since 2009, and IBM is just one of many that will rely on job cuts—not revenue growth—to increase corporate earnings.

In the article “Revenue Growth Collapses at Big American Companies,” Lombardi says he focuses on revenue growth of major companies because it is very important in determining economic growth.

“If the big S&P 500 companies see their revenue growth stalling, they will cut expenses to achieve their projected corporate earnings; a cycle that puts further pressure on our economy—which I’m now believing cannot escape Recession Part II,” says Lombardi.

Lombardi believes this has forced stock market analysts to now cut third-quarter revenue growth projections by 1.0%–1.5%, which is in the territory of recession.

“So how is it that the S&P 500 stock market index is able to remain steady despite the bad news?” asks Lombardi.

The Profit Confidential lead contributor notes that one of the largest S&P 500 companies International Business Machines Corporation, better known as IBM, reported corporate earnings that beat expectations for the second quarter. IBM also raised its corporate earnings guidance for 2012, he adds.

Lombardi believes IBM will be able to increase its corporate earnings in 2012 by cutting jobs, not by revenue growth.

“It is not going to increase revenue, because global spending on technology by companies is falling, which is reflective of the global economic slowdown,” he asserts.

Thus far, according to Lombardi, corporate earnings reports from the S&P 500 companies have confirmed the global economic slowdown.

“Both revenue and earnings growth are becoming harder and harder to come by. And the stock market is starting to see the picture clearly,” Lombardi concludes.

Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market... before it plunged.

Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.

To see the full article and to learn more about Profit Confidential, visit http://www.profitconfidential.com.

Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.

Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Michael Lombardi
Follow us on
Visit website