IBM Cloud Rated Second Big Global IaaS Provider By IDC

As per IDC’s worldwide semiannual public cloud services tracker, International Business Machines (NYSE:IBM) is the second leading Information as a Service (IaaS) provider.

The report took into consideration individual cloud service providers and total market revenues to evaluate the “complete gamut of IaaS capabilities including provisioning servers (virtual and bare metal), storage and networking options.”

IBM CTO Jim Comfort said "We're glad to see IDC recognize the momentum IBM Cloud is making as our investments in data center expansion continue to pay off.” The company already has 47 data centers across the globe forming a part of the company’s ambitious $1.2 billion cloud data center expansion strategy.

We believe that IBM’s growth will be driven primarily by its focus on higher-growth and high-value segments particularly in the software sector. IBM's growth initiatives, including its Big Data & business analytics, cloud computing, mobile, security and social business are expected to drive growth going ahead. For the first quarter, revenues from “Strategic Imperatives” grew 14% year over year to $7 billion and for trailing 12 months, the company’s initiatives have generated about $29.8 billion in revenues.

As per an Apr 2016 IDC report, cloud IT infrastructure for cloud environments spending is expected to grow at a 5-year CAGR of 12.5%, hitting $57.8 billion by 2020. IDC estimates cloud IT infrastructure spending to be 47.9% of total expenditures on enterprise IT infrastructure by 2020. All these spell big opportunity for IBM.

At present, IBM carries a Zacks Rank #3 (Hold). Better-ranked stocks worth consideration in the tech space include NetEase, Inc (NASDAQ:NTES) , Imprivata, Inc. (NYSE:IMPR) and Ellie Mae, Inc. (NYSE:ELLI) . NetEase and Imprivata sport a Zacks Rank #1 (Strong Buy) while Elli Mae carries a Zacks Rank #2 (Buy).