(Reuters) - International Business Machines (NYSE:IBM) has agreed to sell its weather business to private equity firm Francisco Partners for an undisclosed sum, the technology services giant said on Tuesday.
The sale includes The Weather Company's consumer-focused assets such as Weather.com and Storm Radar, as well as enterprise offerings for industries including media and aviation. IBM will retain its sustainability software business.
The Big Blue said Tuesday it plans to continue using The Weather Company's weather data for its software offerings focused on environmental insights.
The so-called Environmental Intelligence Suite uses a NASA-powered model and is offered as part of Watsonx, IBM's artificial intelligence (AI) and data platform.
"Over the last few years, we've evolved IBM to be a hybrid cloud and AI company. We regularly review our portfolio to make sure our business areas are core to that strategy," said Rob Thomas, senior vice president for software.
IBM declined to give more details on the sale. Francisco Partners did not immediately respond to a request for comment.
The Wall Street Journal had reported in April that IBM was exploring a sale of its weather business in a deal that could be valued at more than $1 billion.
The sale underscores a broader retrenchment in the tech industry this year as companies cut costs to offset a slowdown in demand from inflation-wary consumers and businesses.
IBM, which missed revenue estimates for the second quarter in July, had said in January it would lay off 3,900 employees.
But the company has been investing in its cloud offerings and announced a $4.6 billion all-cash buyout of technology spend-management platform Apptio in June.
The deal with Francisco Partners is expected to close in the first quarter of 2024 and is subject to regulatory approval.