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Revenue Recognition | 3 Months Ended
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Mar. 31, 2025
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | Revenue Recognition: Disaggregation of Revenue In the first quarter of 2025, the company made changes to the reported revenue categories within its Software and Consulting reportable segments to better reflect the market opportunities and how IBM addresses them. Beginning January 1, 2025, the company reports revenue for Hybrid Cloud (Red Hat), Automation, Data and Transaction Processing within Software; and it no longer reports revenue for Hybrid Platform & Solutions. Within Consulting, the company reports revenue for Strategy and Technology and Intelligent Operations. These changes did not impact the company's Consolidated Financial Statements or its reportable segments. The following tables provide details of revenue by major products/service offerings and revenue by geography. Revenue by Major Products/Service Offerings
(Dollars in millions) |  |  |  |  |  |  |  |
For the three months ended March 31: |  | 2025 |  | 2024 (1) |  |  |  |
Hybrid Cloud |  | $ | 1,687 |  |  | $ | 1,510 |  |  |  |  |
Automation |  | 1,584 |  |  | 1,391 |  |  |  |  |
Data |  | 1,236 |  |  | 1,173 |  |  |  |  |
Transaction Processing |  | 1,828 |  |  | 1,824 |  |  |  |  |
Total Software |  | $ | 6,336 |  |  | $ | 5,899 |  |  |  |  |
Strategy and Technology |  | 2,782 |  |  | 2,863 |  |  |  |  |
Intelligent Operations |  | 2,286 |  |  | 2,323 |  |  |  |  |
Total Consulting |  | $ | 5,068 |  |  | $ | 5,186 |  |  |  |  |
Hybrid Infrastructure |  | 1,646 |  |  | 1,803 |  |  |  |  |
Infrastructure Support |  | 1,240 |  |  | 1,273 |  |  |  |  |
Total Infrastructure |  | $ | 2,886 |  |  | $ | 3,076 |  |  |  |  |
Financing (2) |  | 191 |  |  | 193 |  |  |  |  |
Other |  | 61 |  |  | 108 |  |  |  |  |
Total revenue |  | $ | 14,541 |  |  | $ | 14,462 |  |  |  |  |
(1)Prior-year amounts recast to reflect January 2025 changes to the reported revenue categories within Software and Consulting segments. (2)Contains lease and loan financing arrangements which are not subject to the guidance on revenue from contracts with customers. Revenue by Geography
(Dollars in millions) |  |  |  |  |  |  |  |
For the three months ended March 31: |  | 2025 |  | 2024 |  |  |  |
Americas |  | $ | 7,206 |  |  | $ | 7,296 |  |  |  |  |
Europe/Middle East/Africa |  | 4,552 |  |  | 4,313 |  |  |  |  |
Asia Pacific |  | 2,783 |  |  | 2,853 |  |  |  |  |
Total |  | $ | 14,541 |  |  | $ | 14,462 |  |  |  |  |
Remaining Performance Obligations The remaining performance obligation (RPO) disclosure provides the aggregate amount of the transaction price yet to be recognized as of the end of the reporting period and an explanation as to when the company expects to recognize these amounts in revenue. It is intended to be a statement of overall work under contract that has not yet been performed and does not include contracts in which the customer is not committed, such as certain as-a-service, governmental, term software license and services offerings. The customer is not considered committed when they are able to terminate for convenience without payment of a substantive penalty. The disclosure includes estimates of variable consideration, except when the variable consideration is a sales-based or usage-based royalty promised in exchange for a license of intellectual property. Additionally, as a practical expedient, the company does not include contracts that have an original duration of one year or less. RPO estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidations, adjustment for revenue that has not materialized and adjustments for currency. At March 31, 2025, the aggregate amount of the transaction price allocated to RPO related to customer contracts that are unsatisfied or partially unsatisfied was approximately $64 billion. Approximately 69 percent of the amount is expected to be recognized as revenue in the subsequent two years, approximately 27 percent in the subsequent three to five years and the balance thereafter. Revenue Recognized for Performance Obligations Satisfied (or Partially Satisfied) in Prior Periods For the three months ended March 31, 2025, revenue recognized for performance obligations satisfied or partially satisfied in prior periods was immaterial. Reconciliation of Contract Balances The following table provides information about notes and accounts receivable — trade, contract assets and deferred income balances.
(Dollars in millions) |  | At March 31, 2025 |  | At December 31, 2024
Notes and accounts receivable — trade (net of allowances of $102 in 2025 and $114 in 2024) |  | $ | 5,857 |  |  | $ | 6,804 |
Contract assets (1) |  | $ | 465 |  |  | $ | 433 |
Deferred income (current) |  | $ | 15,057 |  |  | $ | 13,907 |
Deferred income (noncurrent) |  | $ | 3,844 |  |  | $ | 3,622 |
(1)Included within prepaid expenses and other current assets in the Consolidated Balance Sheet. The amount of revenue recognized during the three months ended March 31, 2025 that was included within the deferred income balance at December 31, 2024 was $4.4 billion and was primarily related to software and services. The following table provides roll forwards of the notes and accounts receivable–trade allowance for expected credit losses for the three months ended March 31, 2025 and the year ended December 31, 2024.
(Dollars in millions) |  |  |  |  |  |  |  |
January 1, 2025 |  | Additions / (Releases) |  | Write-offs (1) |  | Foreign currency and other |  | March 31, 2025
$114 |  | $(10) |  | $(8) |  | $6 |  | $102
January 1, 2024 |  | Additions / (Releases) |  | Write-offs (1) |  | Foreign currency and other |  | December 31, 2024
$192 |  | $(2) |  | $(78) |  | $2 |  | $114
(1)The majority of the write-offs during the period related to receivables which had been previously reserved. The contract assets allowance for expected credit losses was not material in any of the periods presented.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-9 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-10 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-15 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-13 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 606 -Publisher FASB -URI https://asc.fasb.org/606/tableOfContent + Details
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