International Business Machines Corp. delivered a mixed bag of second quarter results Monday with the company beating market expectations on earnings per share off the back of strong growth in its cloud business, while the rest of its legacy business continued to decline.

Big Blue booked in earnings of $3.84 a share in Q2, ahead of a market prediction of $3.78 a share, but of note 13 percent down for the same quarter of 2014.

Sales came in at $20.81 billion for the quarter versus the analyst prediction of $20.95; like the earnings per share this figure was also down over the same quarter of 2014 by 13 percent.

Net income from the quarter for continuing operations came in at $3.8 billion (non-GAAP,) down a full 15 percent versus Q2 2014, while GAAP adjusted income came in at $3.5 billion, down an even bigger 17 percent over the same quarter of 2014.

There was some rosy news for IBM with their “strategic imperative” revenue (their services arm including Cloud and business analytics) up 30 percent vs Q2 2014, with Cloud revenue surging, delivering a strong 70 percent growth figure year-on-year adjusting for currency changes, or 50 percent as reported; in raw numbers cloud delivered as a service delivered $4.5 billion for the quarter, up from $2.8 billion for Q2 2014.

“Our results for the first half of 2015 demonstrate that we continue to transform our business to higher value and return value to shareholders,” IBM Chairman, President and Chief Executive Officer Ginni Rometty said in a statement. “We expanded margins, continued to innovate across our portfolio and delivered strong growth in our strategic imperatives of cloud, analytics and engagement, which are becoming a significant part of our business.”

Wall Street analysts noted positives in the numbers in terms of strategic initiatives, while noting the decline in Big Blue’s traditional business, with Chief Strategist at Belpointe Asset Management David Nelson telling CNBC in an interview that “I think the challenge for the company is can they grow these strategic imperatives faster than the rest of the company is declining.”

Currency problems

The rise and rise of the United States dollar versus currencies across the rest of the world is a problem facing many tech companies, but in terms of IBM, who has a particularly rich global portfolio, it’s hurting their bottom line hard, with the company noting that total revenue, adjusted for currency changes year-on-year would only have been down 1 percent versus the 13 percent decline reported in the figures.

That said though, while it’s fair to accept that IBM, like others, are taking a hit due to foreign exchange fluctuations, these same companies were usually very remiss in noting that many of their previous surging profits were off the back of the previous decline of the US dollar versus global currencies.

The market didn’t like IBM’s results and sold the stock, driving the share price to hit $164.08 in after-hours trading, down 5.29 percent.

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