Computing major IBM has announced that it will split its current business into two companies. While IBM will shift focus to higher-margin businesses like the hybrid cloud and artificial intelligence solutions, the new company, which will be spun off next year, will focus on the legacy IT infrastructure.

CEO Arvind Krishna in conversation with CNBC-TV18 said that part of the company will looking at an over $1.2 trillion market in hybrid cloud and AI solutions. IBM will be a $25 billion co by the time the spin-off is complete, he added.

The new company will have $19 billion in annual revenue and will serve 75 percent of fortune 100 companies when it makes its share market debut. It will officially be named next year and will have 90,000 employees. The separation is expected to cost IBM $5 billion.

Krishna added that the business split is the result of a multi-year journey. The last 15 months have helped IBM build confidence to go in for the split, he added.

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First Published:Oct 9, 2020 8:25 PM IST