IBM hammered on earnings slump

IBM reported a 21 percent slump in first quarter earnings Wednesday, as the computer giant saw weaker hardware sales and focused more on services and the Internet "cloud."

Profits amounted to $2.38 billion on revenues of $22.48 billion.

The results were largely in line with expectations, but in after-hours trade IBM stock slid 4.3 percent to $188.

IBM said revenues from hardware sales including its big servers fell 23 percent, and posted an operating loss in part due to restructuring costs.

But the company saw better results from software and services, including the big data analytics for which "Big Blue" is known.

"In the first quarter, we continued to take actions to transform parts of the business and to shift aggressively to our strategic growth areas including cloud, big data analytics, social, mobile and security," said Ginni Rometty, IBM chairman, president and chief executive.

"As we move through 2014, we will begin to see the benefits from these actions. Over the long term, they will position us to drive growth and higher value for our clients."