IBM Expands Cloud Computing Operations

IBM Expands Cloud Computing Operations


Software giant International Business Machines Corporation (NYSE: IBM) yesterday unveiled its plans to expand its cloud footprint in 18 new zones. Furthermore, the company has acquired three big cloud clients. In addition to the introduction of next generation power generation system servers,  IBM has also built the world’s fastest supercomputer in collaboration with Nvidia for the US Department of Energy’s Oak Ridge National Laboratory. The facts provided below indicate that the stock would remain upbeat in the days to come. IBM closed at $146.58 on Monday, up 0.30% from the prior close.

The Armonk, New York-based company is building new availability zones in high demand centres in Asia-Pacific (Tokyo and Sydney), Europe (Germany and UK), and North America (Washington, DC and Dallas, Texas).  An availability zone is a separate cloud facility within a data center region. It will have an independent power, cooling, and networking facility to strengthen fault tolerance. IBM Cloud operates in 60 locations and these additional facilities will increase the capacity and capability of the main centers. Furthermore, the availability zones also give clients an option to deploy multi-zone Kubernetes clusters using the IBM Cloud Kubernetes Service. This will enable clients to have greater control of their data and comply with new data regulations such as the European Union’s new General Data Protection Regulation (GDPR).

IBM’s cloud facility is already attracting large clients. ExxonMobil, Bausch & Lomb, and Westpac are already migrating their core workloads to the IBM Cloud.

  • ExxonMobil – is using IBM Cloud as the platform for their Speedpass mobile app, which was also developed by IBM Services.  
  • Bausch + Lomb – the global eyecare company, has chosen IBM Cloud for its state-of-the-art cataract surgical system.
  • Westpac – one of Australia’s largest banks has migrated to IBM’s dedicated cloud infrastructure.

In other notable news, the US has once again regained the number one position for owning the world’s fastest supercomputer, which was developed by IBM with assistance from Nvidia Corp. Notably, IBM’s supercomputer Deep Blue became popular in 90s when it won Kasparov in chess.  The supercomputer, named Summit, was developed for the US Department of Energy’s Oak Ridge National Laboratory at a cost of $200 million. Summit, which can perform 200 quadrillion calculations per second, or 200 Petaflops, is almost 60% faster than China’s supercomputer, which can process instructions at a speed of 125.43 Petaflops. Summit is also the world’s smallest supercomputer, occupying two tennis courts.

Summit can reach a speed of 1.88 Exaops. It can be used to analyze millions of genomes quickly. Furthermore, it is very much useful in molecular analysis, cancer research and even in astrophysics.

IBM has also launched the next-generation Power Systems Servers, which incorporates POWER9 processor. The new systems can improve the training times of deep learning systems by 4x, allowing enterprises to create fast and accurate AI applications. The server can also assist in credit risk analysis and real-time fraud detection. The positive developments related to IBM are expected to keep the stock bullish in the short-term.

The stock is rising after testing its major support at 107 levels. Additionally, the oscillator of moving average has turned positive. Therefore, we are expecting the stock to rally in the short-term.

IBM - Technical Analysis - 12th June 2018

To gain from the uptrend, an investment in a call option seems to be a better choice. However, we require an option contract, which does not expire before June 19th. Additionally, the stock of IBM should be trading near $145 in the NYSE.

Disclaimer: The trading analysis offered here is our opinion. It is not provided as trading advice, merely an indication of our trading plan. We cannot guarantee success and we encourage traders to incorporate a strong money management strategy to limit losses. Please use this article as part of your own research before formulating strategies prior to trading.

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