Source document: international-business-machines-corp_2019

Question: What caused the increase in interest expense in 2019?
Facts: driven by a higher average debt balance and higher interest rates as we issued debt to finance the Red Hat acquisition.
Answer: driven by a higher average debt balance and higher interest rates as we issued debt to finance the Red Hat acquisition.

Question: What is excluded from the Operating (non-GAAP) interest expense?
Facts: It excludes the Red Hat pre-closing debt financing costs.
Answer: It excludes the Red Hat pre-closing debt financing costs.

Question: What was the increase in interest expense from 2018?
Facts: $621 million
Answer: $621 million

Question: What was the average Interest expense?
Facts: 1,344; 723
Derivation: (1,344 + 723) / 2
Answer: 1033.5 million

Question: What is the increase / (decrease) in Acquisition-related charges from 2018 to 2019? 
Facts: 0; 228
Derivation: -228 - 0
Answer: -228 million

Question: What is the increase / (decrease) in the Operating (non-GAAP) interest expense from 2018 to 2019?
Facts: 1,116; 723
Derivation: 1,116 - 723
Answer: 393 million

Question: What does the recorded investment include?
Facts: Includes deferred initial direct costs which are eliminated in IBM’s consolidated results.
Answer: Includes deferred initial direct costs which are eliminated in IBM’s consolidated results.

Question: What was the decline in the global financing receivables?
Facts: driven by write-offs of $64 million, primarily of receivables previously reserved, and net releases of $7 million as a result of lower average asset balances in client and commercial financing. See note K, “Financing Receivables,” for additional information.
Answer: driven by write-offs of $64 million, primarily of receivables previously reserved, and net releases of $7 million as a result of lower average asset balances in client and commercial financing. See note K, “Financing Receivables,” for additional information.

Question: What is the total allowance for credit losses in 2019?
Facts: 221
Answer: 221 million

Question: What is the increase / (decrease) in the recorded investment from 2018 to 2019?
Facts: 22,446; 31,182
Derivation: 22,446 - 31,182
Answer: -8736 million

Question: What is the average Specific allowance for credit losses?
Facts: 177; 220
Derivation: (177 + 220) / 2
Answer: 198.5 million

Question: What is the percentage increase / (decrease) in the Net financing receivables from 2018 to 2019?
Facts: 22,224; 30,890
Derivation: 22,224 / 30,890 - 1
Answer: -28.05 percent

Question: From where did the company has consistently generated strong cash flow?
Facts: operations
Answer: operations

Question: What is the cash flow from operations in 2019?
Facts: $14.8 billion
Answer: $14.8 billion

Question: What are the sources of additional liquidity?
Facts: maintaining an adequate cash balance, access to global funding sources, committed global credit facilities and other committed and uncommitted lines of credit worldwide.
Answer: maintaining an adequate cash balance, access to global funding sources, committed global credit facilities and other committed and uncommitted lines of credit worldwide.

Question: What is the average of Net cash from operating activities?
Facts: 14.8; 15.2; 16.7
Derivation: (14.8+15.2+16.7) / 3
Answer: 15.57 billion

Question: What is the average of Cash, restricted cash and short-term marketable securities?
Facts: 12.2; 12.8; 9.0
Derivation: (9.0+12.2+12.8) / 3
Answer: 11.33 billion

Question: What is the average of Committed global credit facilities?
Facts: 15.3
Derivation: (15.3+15.3+15.3) / 3
Answer: 15.3 billion

Question: What was the Total unrecognized compensation cost related to non-vested awards at December 31, 2019?
Facts: $1.2 billion
Answer: $1.2 billion

Question: In how many years is the Total unrecognized compensation cost related to non-vested awards is to be recognized?
Facts: 2.5 years
Answer: 2.5 years

Question: What was the amount of capitalized stock-based compensation cost in December 31, 2019?
Facts: not material
Answer: not material

Question: What was the increase / (decrease) in the cost from 2018 to 2019?
Facts: 100; 82
Derivation: 100 - 82
Answer: 18 million

Question: What is the average Selling, general and administrative?
Facts: 361; 384; 453
Derivation: (453 + 361 + 384) / 3
Answer: 399.33 million

Question: What is the percentage increase / (decrease) of Research, development and engineering from 2018 to 2019?
Facts: 126; 67
Derivation: 126 / 67 - 1
Answer: 88.06 percent

Question: As of December 31, 2019, what was the unrecognized compensation cost related to non-vested RSUs?
Facts: $1.1 billion
Answer: $1.1 billion

Question: Over what duration will the unrecognized compensation cost related to non-vested RSUs be recognized?
Facts: 2.5 years
Answer: 2.5 years

Question: What were the tax benefits realized by the company for year ended 31 December 2019?
Facts: $131 million
Answer: $131 million

Question: What is the increase / (decrease) in the RSUs Granted from 2018 to 2019?
Facts: 583; 674
Derivation: 674 - 583
Answer: 91 million

Question: What is the average RSUs vested?
Facts: 381; 428; 463
Derivation: (428 + 381 + 463) / 3
Answer: 424 million

Question: What is the percentage increase / (decrease) in PSUs granted from 2018 to 2019?
Facts: 118; 164
Derivation: 164 / 118 - 1
Answer: 38.98 percent

Question: What percent of the total external portfolio was with investment-grade clients with no direct exposure to consumers?
Facts: 62 percent
Answer: 62 percent

Question: What will be the increase in the investment grade post adjusting for mitigation actions?
Facts: 67 percent
Answer: 67 percent

Question: What was the available cash in 2019?
Facts: $ 1,697
Answer: $ 1,697 million

Question: What is the increase / (decrease) in the cash from 2018 to 2019?
Facts: 1,697; 1,833
Derivation: 1,697 - 1,833
Answer: -136 million

Question: What is the average of Equipment under operating leases— external clients?
Facts: 238; 444
Derivation: (238 + 444) / 2
Answer: 341 million

Question: What is the percentage increase / (decrease) in Total client financing assets from 2018 to 2019? 
Facts: 19,346; 20,170
Derivation: 19,346 / 20,170 - 1
Answer: -4.09 percent

Question: What activity impacted the 2019 results?
Facts: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.
Answer: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.

Question: What expenses were included in 2019 total consolidated expenses and other (income)?
Facts: Red Hat operational spending, interest expense from debt issuances to fund the acquisition and other acquisition-related activity, including: amortization of acquired intangible assets, retention and legal and advisory fees associated with the transaction.
Answer: Red Hat operational spending, interest expense from debt issuances to fund the acquisition and other acquisition-related activity, including: amortization of acquired intangible assets, retention and legal and advisory fees associated with the transaction.

Question: What caused the increase in the total operating expenses?
Facts: Total operating (non-GAAP) expense and other (income) increased 4.1 percent year to year, driven primarily by the factors above excluding the higher non-operating acquisition related activity and lower non-operating retirement-related costs described above.
Answer: Total operating (non-GAAP) expense and other (income) increased 4.1 percent year to year, driven primarily by the factors above excluding the higher non-operating acquisition related activity and lower non-operating retirement-related costs described above.

Question: What is the average of Total consolidated expense and other (income)?
Facts: 25,594; 26,322
Derivation: (26,322 + 25,594) / 2
Answer: 25958 million

Question: What is the increase / (decrease) in the Amortization of acquired intangible assets from 2018 to 2019?
Facts: 437; 764
Derivation: -764 - ( -437)
Answer: -327 million

Question: What is the increase / (decrease) in the Operating (non-GAAP) expense and other (income) from 2018 to 2019?
Facts: 23,569; 24,533
Derivation: 24,533 - 23,569
Answer: 964 million

Question: In 2018, net income includes what additional charges?
Facts: Includes charges of $2.0 billion in 2018 associated with U.S. tax reform.
Answer: Includes charges of $2.0 billion in 2018 associated with U.S. tax reform.

Question: In 2019, results were impacted by which activity?
Facts: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.
Answer: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.

Question: What was the U.S. tax reform charge in 2019?
Facts: 146
Answer: 146 million

Question: What was the increase / (decrease) in Net income from 2018 to 2019?
Facts: 8,728; 9,431
Derivation: 9,431 - 8,728
Answer: 703 million

Question: What was the increase / (decrease) in Income from continuing operations from 2018 to 2019?
Facts: 8,723; 9,435
Derivation: 9,435 - 8,723
Answer: 712 million

Question: What was the increase / (decrease) in Operating (non-GAAP) earnings from continuing operations from 2018 to 2019?
Facts: 11,436; 12,657
Derivation: 11,436 - 12,657
Answer: -1221 million

Question: How does the company utilizes certain of its financing receivables?
Facts: The company utilizes certain of its financing receivables as collateral for nonrecourse borrowings.
Answer: The company utilizes certain of its financing receivables as collateral for nonrecourse borrowings.

Question: What amount of Financing receivables pledged as collateral for borrowings in December 2018 and 2019?
Facts: Financing receivables pledged as collateral for borrowings were $1,062 million and $710 million at December 31, 2019 and 2018, respectively.
Answer: Financing receivables pledged as collateral for borrowings were $1,062 million and $710 million at December 31, 2019 and 2018, respectively.

Question: Did the company have any financing receivables held for sale as of December 2019 and 2018.
Facts: The company did not have any financing receivables held for sale as of December 31, 2019 and 2018.
Answer: The company did not have any financing receivables held for sale as of December 31, 2019 and 2018.

Question: What is the average Unearned income?
Facts: 1,195; 3
Derivation: 1,195 / 3
Answer: 398.33 million

Question: What is the average Recorded investment?
Facts: 3; 31,153
Derivation: 31,153 / 3
Answer: 10384.33 million

Question: How much is the difference between Unguaranteed and Guaranteed residual value of Investment in Sales-Type and Direct Financing Leases?
Facts: 589; 85
Derivation: 589-85 
Answer: 504 million

Question: What led to decrease in Systems gross profit margin?
Facts: The Systems gross profit margin decrease year to year was driven by the mix away from IBM Z and margin declines in Power Systems and Storage Systems.
Answer: The Systems gross profit margin decrease year to year was driven by the mix away from IBM Z and margin declines in Power Systems and Storage Systems.

Question: What led to decrease in pre-tax income?
Facts: The pre-tax income decline was driven by the strong performance in IBM Z in the prior year and the continued investment in innovation across the Systems portfolio.
Answer: The pre-tax income decline was driven by the strong performance in IBM Z in the prior year and the continued investment in innovation across the Systems portfolio.

Question: Did the Systems gross profit margin increase or decrease year to year?
Facts: The Systems gross profit margin decrease year to year
Answer: The Systems gross profit margin decrease year to year

Question: What is the average of External Systems Hardware gross profit?
Facts: 2,590; 2,893
Derivation: (2,590+2,893) / 2
Answer: 2741.5 million

Question: What is the increase/ (decrease) in External Systems Hardware gross profit from 2017 to 2018
Facts: 2,590; 2,893
Derivation: 2,590-2,893
Answer: -303 million

Question: What is the increase/ (decrease) in Pre-tax margin from 2017 to 2018
Facts: 10.2; 12.6
Derivation: 10.2-12.6 
Answer: -2.4 percent

Question: In 2019, what was the amount contributed to US Treasury securities?
Facts: $635 million
Answer: $635 million

Question: Contribution to US Treasury is considered what kind of a transaction?
Facts: non-cash transaction
Answer: non-cash transaction

Question: What was the Non pension post retirement benefit plan in 2019?
Facts: 304
Answer: 304 million

Question: What is the increase / (decrease) in the Non-U.S. DB plans from 2018 to 2019?
Facts: 243; 325
Derivation: 243 - 325
Answer: -82 million

Question: What is the average Non pension postretirement benefit plans?
Facts: 304; 335
Derivation: (304 + 335) / 2
Answer: 319.5 million

Question: What is the percentage increase / (decrease) in the Direct benefit payments from 2018 to 2019?
Facts: 559; 567
Derivation: 559 / 567 - 1
Answer: -1.41 percent

Question: Why are Commercial financing receivables are excluded from financing receivables?
Facts: they are short term in nature and the current estimated risk of loss and resulting impact to the company’s financing results are not material.
Answer: they are short term in nature and the current estimated risk of loss and resulting impact to the company’s financing results are not material.

Question: What were the write-offs in December 2019?
Facts: $16 million
Answer: $16 million

Question: What is the average recorded investment of impaired leases and loans for Americas for December 2019?
Facts: $138 million
Answer: $138 million

Question: What is the average Recorded investment of Lease receivables for Americas and EMEA for December 2019?
Facts: 1,186; 3,419
Derivation: (3,419+1,186) / 2 
Answer: 2302.5 million

Question: What is the average Recorded investment of Loan receivables for Americas and EMEA for December 2019?
Facts: 3,901; 6,726
Derivation: (6,726+3,901) / 2 
Answer: 5313.5 million

Question: What is the average Allowance for credit losses of Lease receivables at the beginning of January 2019?
Facts: 3; 99
Derivation: 99/ 3
Answer: 33 million

Question: What was the focus area for business in Infrastructure & Cloud Services 
Facts: In Infrastructure & Cloud Services, the business focused on prioritizing the portfolio to deliver high-value solutions to bring productivity to clients and allow for expanding workloads, while it exited some lower-value offerings.
Answer: In Infrastructure & Cloud Services, the business focused on prioritizing the portfolio to deliver high-value solutions to bring productivity to clients and allow for expanding workloads, while it exited some lower-value offerings.

Question: What impacted the Technology Support Services in 2018?
Facts: Technology Support Services was impacted by the hardware product cycle dynamics in 2018
Answer: Technology Support Services was impacted by the hardware product cycle dynamics in 2018

Question: How much did the cloud revenue grew within GTS?
Facts: Within GTS, cloud revenue of $8.0 billion grew 22 percent as reported and 21 percent adjusted for currency compared to the prior year.
Answer: Within GTS, cloud revenue of $8.0 billion grew 22 percent as reported and 21 percent adjusted for currency compared to the prior year.

Question: What is the increase/ (decrease) in Global Technology Services external revenue from 2017 to 2018
Facts: 29,146; 29,213
Derivation: 29,146-29,213 
Answer: -67 million

Question: What is the average of Global Technology Services external revenue for the year 2018 and 2017
Facts: 29,146; 29,213
Derivation: (29,146+29,213) / 2
Answer: 29179.5 million

Question: What is the increase/ (decrease) in Technology Support Services from 2017 to 2018
Facts: 6,961; 7,196
Derivation: 6,961-7,196
Answer: -235 million

Question: What caused the Total pre-tax retirement-related plan cost to decrease?
Facts: driven by a decrease in recognized actuarial losses ($1,123 million), primarily due to the change in the amortization period in the U.S. Qualified Personal Pension
Answer: driven by a decrease in recognized actuarial losses ($1,123 million), primarily due to the change in the amortization period in the U.S. Qualified Personal Pension

Question: What caused the Non-operating costs to decrease?
Facts: As discussed in the “Operating (non-GAAP) Earnings” section, we characterize certain retirement-related costs as operating and others as non-operating. Utilizing this characterization, operating retirement-related costs in 2019 were $1,457 million, a decrease of $37 million compared to 2018. Non-operating costs of $615 million in 2019 decreased $957 million year to year, driven primarily by the same factors as above.
Answer: As discussed in the “Operating (non-GAAP) Earnings” section, we characterize certain retirement-related costs as operating and others as non-operating. Utilizing this characterization, operating retirement-related costs in 2019 were $1,457 million, a decrease of $37 million compared to 2018. Non-operating costs of $615 million in 2019 decreased $957 million year to year, driven primarily by the same factors as above.

Question: What were the operating retirement related costs in 2019?
Facts: $1,457 million
Answer: $1,457 million

Question: What was the increase / (decrease) in service cost from 2018 to 2019?
Facts: 385; 431
Derivation: 385 - 431
Answer: -46 million

Question: What was the average interest cost?
Facts: 2,726; 2,929
Derivation: (2,929 + 2,726) / 2
Answer: 2827.5 million

Question: What was the increase / (decrease) in the Other costs from 2018 to 2019?
Facts: 16; 28
Derivation: 28 - 16
Answer: 12 million

Question: What was the Pre-tax income in 2018?
Facts: $1,629
Answer: $1,629 million

Question: What drove the margins and pre-tax income in GBS improvement?
Facts: were the result of the shift to higher-value offerings, realignment of resources to key skill areas, increased productivity and utilization as well as a benefit from currency, due to the company’s global delivery model.
Answer: were the result of the shift to higher-value offerings, realignment of resources to key skill areas, increased productivity and utilization as well as a benefit from currency, due to the company’s global delivery model.

Question: What was the gross profit margin in 2018?
Facts: 26.8%
Answer: 26.8%

Question: What is the increase / (decrease) in the external gross profit from 2017 to 2018?
Facts: 4,033; 4,448
Derivation: 4,448 - 4,033
Answer: 415 million

Question: What is the average Pre-tax income?
Facts: 1,303; 1,629
Derivation: (1,629 + 1,303) / 2
Answer: 1466 million

Question: What is the increase / (decrease) in the Pre-tax margin from 2017 to 2018?
Facts: 7.9; 9.6
Derivation: 9.6% - 7.9%
Answer: 1.7 percent

Question: What event impacted the 2019 results?
Facts: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.
Answer: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.

Question: What caused the year-to-year increase in the total expenses and other (income)?
Facts: The year-to-year increase was a result of higher spending (15 points) driven by Red Hat (15 points) and higher acquisitionrelated charges and amortization of acquired intangible assets associated with the Red Hat transaction (4 points), partially offset by higher divestiture gains (3 points) and lower non-operating retirement-related costs (3 points).
Answer: The year-to-year increase was a result of higher spending (15 points) driven by Red Hat (15 points) and higher acquisitionrelated charges and amortization of acquired intangible assets associated with the Red Hat transaction (4 points), partially offset by higher divestiture gains (3 points) and lower non-operating retirement-related costs (3 points).

Question: What caused total operating (non-GAAP) expense and other income to increase?
Facts: driven by the higher spending, partially offset by the divestiture gains, as described above.
Answer: driven by the higher spending, partially offset by the divestiture gains, as described above.

Question: What was the increase / (decrease) in Total consolidated expense and other (income) from 2018 to 2019?
Facts: 6,253; 7,107
Derivation: 7,107 - 6,253
Answer: 854 million

Question: What is the average Amortization of acquired intangible assets?
Facts: 106; 2; 294
Derivation: ( - 294 + (- 106)) / 2
Answer: -200 million

Question: What is the average of Operating (non-GAAP) expense and other (income)?
Facts: 5,746; 6,591
Derivation: (6,591 + 5,746) / 2
Answer: 6168.5 million

Question: What caused the Global Financing total revenue to decrease?
Facts: This was due to a decrease in internal revenue of 23.5 percent, driven by decreases in internal used equipment sales (down 27.4 percent to $862 million) and internal financing (down 12.6 percent to $370 million).
Answer: This was due to a decrease in internal revenue of 23.5 percent, driven by decreases in internal used equipment sales (down 27.4 percent to $862 million) and internal financing (down 12.6 percent to $370 million).

Question: What caused the internal financing revenue to decrease?
Facts: The decrease in internal financing revenue was due to lower average asset balances, partially offset by higher asset yields. The decrease in external financing revenue reflects the wind down of the OEM IT commercial financing operations.
Answer: The decrease in internal financing revenue was due to lower average asset balances, partially offset by higher asset yields. The decrease in external financing revenue reflects the wind down of the OEM IT commercial financing operations.

Question: What caused the sales of used equipment to decrease?
Facts: The decrease in 2019 was due to a lower volume of internal used equipment sales.
Answer: The decrease in 2019 was due to a lower volume of internal used equipment sales.

Question: What is the average External revenue?
Facts: 1,400; 1,590
Derivation: (1,400 + 1,590) / 2
Answer: 1495 million

Question: What is the increase / (decrease) in the internal revenue from 2018 to 2019?
Facts: 1,232; 1,610
Derivation: 1,232 - 1,610
Answer: -378 million

Question: What percentage of total revenue is Pre-tax income in 2019?
Facts: 1,055; 2,632
Derivation: 1,055 / 2,632
Answer: 40.08 percent

Question: What does Net Income include?
Facts: Includes charges of $0.1 billion in 2019 and $2.0 billion in 2018 associated with U.S. tax reform.
Answer: Includes charges of $0.1 billion in 2019 and $2.0 billion in 2018 associated with U.S. tax reform.

Question: What was the Operating (non-GAAP) earnings in 2019?
Facts: 11,436
Answer: 11,436 million

Question: What is the Basic earnings per share in 2019?
Facts: 10.63
Answer: 10.63

Question: What is the increase / (decrease) in revenue from 2018 to 2019?
Facts: 77,147; 79,591
Derivation: 77,147 - 79,591
Answer: -2444 million

Question: What are the total assets increase / (decrease) from 2018 to 2019?
Facts: 123,382; 152,186
Derivation: 152,186 - 123,382
Answer: 28804 million

Question: What is the Debt to Capital Ratio in 2019?
Facts: 45,812; 62,899
Derivation: 62,899 / (62,899 + 45,812)
Answer: 57.86 percent

Question: How has the revenue year to year change been adjusted?
Facts: (1.0) percent adjusted for currency; 0.2 percent excluding divested businesses and adjusted for currency
Answer: (1.0) percent adjusted for currency; 0.2 percent excluding divested businesses and adjusted for currency

Question: What impacted the 2019 results?
Facts: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity
Answer: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity

Question: What charges were included in 2018?
Facts: Includes charges of $2.0 billion or $2.23 of diluted earnings per share in 2018 associated with U.S. tax reform.
Answer: Includes charges of $2.0 billion or $2.23 of diluted earnings per share in 2018 associated with U.S. tax reform.

Question: What was the increase / (decrease) in revenue from 2018 to 2019?
Facts: 77,147; 79,591
Derivation: 77,147 - 79,591
Answer: -2444 million

Question: What was the total assets turnover ratio in 2019?
Facts: 152,186; 77,147
Derivation: 77,147 / 152,186
Answer: 50.69 percent

Question: What was the percentage increase / (decrease) in the net income from 2018 to 2019?
Facts: 8,728; 9,431
Derivation: 9,431 / 8,728 - 1
Answer: 8.05 percent

Question: What was the decrease in Working capital from 2018?
Facts: $10,200 million
Answer: $10,200 million

Question: What caused the current assets to decrease?
Facts: A decline in receivables of $6,769 million ($6,695 million adjusted for currency) driven by a decline in financing receivables of $8,197 million primarily due to the wind down of OEM IT commercial financing operations; partially offset by an increase in other receivables of $989 million primarily related to divestitures; and • A decrease of $3,213 million ($3,052 million adjusted for currency) in cash and cash equivalents, restricted cash, and marketable securities primarily due to retirement of debt.
Answer: A decline in receivables of $6,769 million ($6,695 million adjusted for currency) driven by a decline in financing receivables of $8,197 million primarily due to the wind down of OEM IT commercial financing operations; partially offset by an increase in other receivables of $989 million primarily related to divestitures; and • A decrease of $3,213 million ($3,052 million adjusted for currency) in cash and cash equivalents, restricted cash, and marketable securities primarily due to retirement of debt.

Question: What caused the current liabilities to decrease?
Facts: • A decrease in accounts payable of $1,662 million primarily due to the wind down of OEM IT commercial financing operations; and • A decrease in short-term debt of $1,410 million due to maturities of $12,649 million and a decrease in commercial paper of $2,691 million; partially offset by reclassifications of $7,592 million from long-term debt to reflect upcoming maturities and issuances of $6,334 million; offset by • An increase in operating lease liabilities of $1,380 million as a result of the adoption of the new leasing standard on January 1, 2019; and • An increase in deferred income of $861 million ($890 million adjusted for currency).
Answer: • A decrease in accounts payable of $1,662 million primarily due to the wind down of OEM IT commercial financing operations; and • A decrease in short-term debt of $1,410 million due to maturities of $12,649 million and a decrease in commercial paper of $2,691 million; partially offset by reclassifications of $7,592 million from long-term debt to reflect upcoming maturities and issuances of $6,334 million; offset by • An increase in operating lease liabilities of $1,380 million as a result of the adoption of the new leasing standard on January 1, 2019; and • An increase in deferred income of $861 million ($890 million adjusted for currency).

Question: What was the increase / (decrease) in the current assets from 2018 to 2019?
Facts: 38,420; 49,146
Derivation: 38,420 - 49,146
Answer: -10726 million

Question: What is the percentage increase / (decrease) in Current liabilities from 2018 to 2019?
Facts: 37,701; 38,227
Derivation: 37,701/38,227 - 1
Answer: -1.38 percent

Question: What is the average working capital?
Facts: 10,918; 718
Derivation: (718 + 10,918) / 2
Answer: 5818 million

Question: What led to increase in Global Financing total revenue?
Facts: an increase in internal revenue, partially offset by a decrease in external revenue.
Answer: an increase in internal revenue, partially offset by a decrease in external revenue.

Question: What led to decline in External revenue 
Facts: a decrease in external used equipment sales (down 30.8 percent), partially offset by an increase in external financing (up 4.9 percent).
Answer: a decrease in external used equipment sales (down 30.8 percent), partially offset by an increase in external financing (up 4.9 percent).

Question: What led to increase in Global Financing pre-tax income?
Facts: an increase in gross profit and a decrease in total expense.
Answer: an increase in gross profit and a decrease in total expense.

Question: What is the increase/ (decrease) in External revenue from 2017 to 2018
Facts: 1,590; 1,696
Derivation: 1,590-1,696
Answer: -106 million

Question: What is the increase/ (decrease) in Internal Revenue from 2017 to 2018
Facts: 1,471; 1,610
Derivation: 1,610-1,471 
Answer: 139 million

Question: What is the average of Internal Revenue?
Facts: 1,471; 1,610
Derivation: (1,610+1,471) / 2
Answer: 1540.5 million

Question: What caused the decrease in the total debt?
Facts: driven by issuances of $32,415 million; partially offset by debt maturities of $12,673 million and a decrease in commercial paper of $2,691 million.
Answer: driven by issuances of $32,415 million; partially offset by debt maturities of $12,673 million and a decrease in commercial paper of $2,691 million.

Question: What was the increase in the Non-Global Financing debt from 2018?
Facts: $23,587 million
Answer: $23,587 million

Question: What was the increase in the Global Financing debt from 2018?
Facts: $6,500 million
Answer: $6,500 million

Question: What was the increase / (decrease) in the total company debt from 2018 to 2019?
Facts: 45,812; 62,899
Derivation: 62,899 - 45,812
Answer: 17087 million

Question: What was the average Debt to support external clients?
Facts: 21,487; 27,536
Derivation: (21,487 + 27,536) / 2
Answer: 24511.5 million

Question: What is the percentage increase / (decrease) in the Non-Global Financing debt from 2018 to 2019?
Facts: 14,585; 38,173
Derivation: 38,173 / 14,585 - 1
Answer: 161.73 percent

Question: What caused the decrease in the actual shares?
Facts: The year-to- year decrease was primarily the result of the common stock repurchase program
Answer: The year-to- year decrease was primarily the result of the common stock repurchase program

Question: What was the increase / (decrease) in the average number of common shares in 2019?
Facts: 23.5 million shares lower in 2019 versus 2018
Answer: 23.5 million shares lower in 2019 versus 2018

Question: What additional charges were included in 2018?
Facts: Includes a charge of $2.0 billion or $2.23 of basic and diluted earnings per share in 2018 associated with U.S. tax reform.
Answer: Includes a charge of $2.0 billion or $2.23 of basic and diluted earnings per share in 2018 associated with U.S. tax reform.

Question: What was the increase / (decrease) from the Earnings per share of common stock from continuing operations basic?
Facts: 10.63; 9.56
Derivation: 10.63 - 9.56
Answer: 1.07

Question: What is the increase / (decrease) from the Earnings per share of common stock from continuing operations Diluted operating (non-GAAP)?
Facts: 12.81; 13.81
Derivation: 12.81 - 13.81
Answer: -1

Question: What is the increase / (decrease) in the Weighted-average shares outstanding assuming dilution?
Facts: 892.8; 916.3
Derivation: 892.8 - 916.3
Answer: -23.5

Question: What is the payment term for financing arrangements
Facts: Payment terms on these financing arrangements are generally for terms up to seven years. Client loans and installment payment financing contracts are priced independently at competitive market rates
Answer: Payment terms on these financing arrangements are generally for terms up to seven years. Client loans and installment payment financing contracts are priced independently at competitive market rates

Question: What is the purpose of Client loan and installment payment receivables (loans)?
Facts: Client loan and installment payment receivables (loans) are provided primarily to clients to finance the purchase of hardware, software and services.
Answer: Client loan and installment payment receivables (loans) are provided primarily to clients to finance the purchase of hardware, software and services.

Question: What is the payment term for inventory and accounts receivable financing?
Facts: Payment terms for inventory and accounts receivable financing generally range from 30 to 90 days.
Answer: Payment terms for inventory and accounts receivable financing generally range from 30 to 90 days.

Question: What is the average of Total financing receivables, net?
Facts: 12,884; 3,820; 6,199
Derivation: (6,199+3,820+12,884) / 3
Answer: 7634.33 million

Question: What is the average of Unearned income?
Facts: 1,083; 3
Derivation: 1,083/ 3
Answer: 361 million

Question: What is the average of Recorded investment?
Facts: 13,022; 3,831; 5,567
Derivation: (5,567+3,831+13,022) / 3
Answer: 7473.33 million

Question: What led to fall in systems revenue from 2017 to 2018?
Facts: strong IBM Z performance in 2017 and continued price pressures impacting Storage Systems in a competitive environment
Answer: strong IBM Z performance in 2017 and continued price pressures impacting Storage Systems in a competitive environment

Question: What factors led to growth in Power Systems 
Facts: strong performance in POWER9-based systems and Linux throughout the year.
Answer: strong performance in POWER9-based systems and Linux throughout the year.

Question: How was the performance of hardware platforms year to year
Facts: hardware platforms were down year to year for the full year, as reported and adjusted for currency.
Answer: hardware platforms were down year to year for the full year, as reported and adjusted for currency.

Question: What is the increase/ (decrease) in Systems external revenue from 2017 to 2018
Facts: 8,034; 8,194
Derivation: 8,034-8,194
Answer: -160 million

Question: What is the increase/ (decrease) in the value of Systems Hardware from 2017 to 2018
Facts: 6,363; 6,494
Derivation: 6,363-6,494
Answer: -131 million

Question: What is the increase/ (decrease) in the value of Operating Systems Software from 2017 to 2018
Facts: 1,671; 1,701
Derivation: 1,671-1,701
Answer: -30 million

Question: What caused the Total selling, general and administrative (SG&A) expense to increase?
Facts: Higher spending (5 points) driven by Red Hat spending (5 points); and • Higher acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat acquisition (3 points); partially offset by • The effects of currency (2 points).
Answer: Higher spending (5 points) driven by Red Hat spending (5 points); and • Higher acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat acquisition (3 points); partially offset by • The effects of currency (2 points).

Question: What caused the Operating (non-GAAP) expense to increase?
Facts: driven by the same factors excluding the acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat transaction.
Answer: driven by the same factors excluding the acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat transaction.

Question: What were the Bad debt expenses in 2019?
Facts: 89
Answer: 89 million

Question: What was the increase / (decrease) in the Selling, general and administrative—other from 2018 to 2019?
Facts: 16,438; 17,099
Derivation: 17,099 - 16,438
Answer: 661 million

Question: What was the average of Advertising and promotional expense?
Facts: 1,466; 1,647
Derivation: (1,647 + 1,466) / 2
Answer: 1556.5 million

Question: What is the increase / (decrease) in the Stock-based compensation from 2018 to 2019?
Facts: 361; 453
Derivation: 453 - 361
Answer: 92 million

Question: How much was the write-offs of lease and loan receivables for December 2018?
Facts: Write-offs of lease receivables and loan receivables were $15 million and $20 million, respectively, for the year ended December 31, 2018.
Answer: Write-offs of lease receivables and loan receivables were $15 million and $20 million, respectively, for the year ended December 31, 2018.

Question: What is the average recorded investment of impaired leases and loans for Americas, EMEA and Asia Pacific for December 2018?
Facts: The average recorded investment of impaired leases and loans for Americas, EMEA and Asia Pacific was $138 million, $55 million and $73 million, respectively, for the year ended December 31, 2018.
Answer: The average recorded investment of impaired leases and loans for Americas, EMEA and Asia Pacific was $138 million, $55 million and $73 million, respectively, for the year ended December 31, 2018.

Question: How much credit losses were recorded for lease and loan receivables for December 2018?
Facts: Provisions for credit losses recorded for lease receivables and loan receivables were $14 million and $2 million, respectively, for the year ended December 31, 2018.
Answer: Provisions for credit losses recorded for lease receivables and loan receivables were $14 million and $2 million, respectively, for the year ended December 31, 2018.

Question: What is the average Recorded investment of Loan receivables for Americas and EMEA for December 2018?
Facts: 3,675; 6,817
Derivation: (6,817+3,675) / 2
Answer: 5246 million

Question: What is the average Allowance for credit losses of Lease receivables at the beginning of January 2018?
Facts: 103; 3
Derivation: 103 / 3
Answer: 34.33 million

Question: What is the average Recorded investment of Lease receivables for Americas and EMEA for December 2018?
Facts: 1,341; 3,827
Derivation: (3,827+1,341) / 2
Answer: 2584 million

Question: What are the benefits reflected from gross profit margin?
Facts: The 2018 GTS gross profit margin was essentially flat year to year and reflected benefits from productivity initiatives
Answer: The 2018 GTS gross profit margin was essentially flat year to year and reflected benefits from productivity initiatives

Question: What does the productivity initiatives include?
Facts: automation of delivery processes infused with AI and global workforce optimization.
Answer: automation of delivery processes infused with AI and global workforce optimization.

Question: What does the Pre-tax income performance implied? 
Facts: Pre-tax income performance reflected continued investment to expand go-to-market capabilities and develop new offerings for the hybrid market.
Answer: Pre-tax income performance reflected continued investment to expand go-to-market capabilities and develop new offerings for the hybrid market.

Question: What is the average of External total gross profit?
Facts: 10,022; 10,035
Derivation: (10,035+10,022) / 2
Answer: 10028.5 million

Question: What is the increase/ (decrease) in External total gross profit from 2017 to 2018
Facts: 10,022; 10,035
Derivation: 10,035-10,022
Answer: 13 million

Question: What is the increase/ (decrease) in Pre-tax income from 2017 to 2018
Facts: 1,781; 2,618
Derivation: 1,781-2,618 
Answer: -837 million

Question: What is the current and noncurrent total deferred costs for 2019?
Facts: $1,896 million was current and $2,472 million was noncurrent at December 31, 2019
Answer: $1,896 million was current and $2,472 million was noncurrent at December 31, 2019

Question: What is the current and noncurrent total deferred costs for 2018?
Facts: $2,300 million was current and $2,676 million was noncurrent at December 31, 2018.
Answer: $2,300 million was current and $2,676 million was noncurrent at December 31, 2018.

Question: What is the total deferred costs amortized during 2019?
Facts: $3,836 million
Answer: $3,836 million

Question: What is the increase/ (decrease) in Capitalized costs to obtain a contract from 2018 to 2019
Facts: 609; 717
Derivation: 609-717
Answer: -108 million

Question: What is the average of Capitalized costs to obtain a contract?
Facts: 609; 717
Derivation: (609+717) / 2
Answer: 663 million

Question: What is the average of Deferred setup costs?
Facts: 1,939; 2,085
Derivation: (1,939 +2,085) / 2
Answer: 2012 million

Question: What impacted the Gross margin in Cloud & Cognitive Software?
Facts: impacted by an increased mix toward SaaS, a mix toward security services and increased royalty costs associated with IP licensing agreements compared to the prior year
Answer: impacted by an increased mix toward SaaS, a mix toward security services and increased royalty costs associated with IP licensing agreements compared to the prior year

Question: What drove the Pre-tax income improvement?
Facts: primarily driven by operational efficiencies and mix.
Answer: primarily driven by operational efficiencies and mix.

Question: What was the gross profit margin in 2018?
Facts: 77.6%
Answer: 77.6%

Question: What is the increase / (decrease) in the external gross profit from 2017 to 2018?
Facts: 16,986; 17,224
Derivation: 17,224 - 16,986
Answer: 238 million

Question: What is the average Pre-tax income?
Facts: 8,068; 8,882
Derivation: (8,882 + 8,068) / 2
Answer: 8475 million

Question: What is the increase / (decrease) in the Pre-tax margin from 2017 to 2018?
Facts: 32.4; 35.0
Derivation: 35.0% - 32.4%
Answer: 2.6 percent

Question: What caused the decrease in the pre-tax income in 2019?
Facts: The year-to-year improvements in margins and pre-tax income were driven by the continued mix shift to higher-value offerings, the yield from delivery productivity improvements and a currency benefit from leveraging the global delivery resource model.
Answer: The year-to-year improvements in margins and pre-tax income were driven by the continued mix shift to higher-value offerings, the yield from delivery productivity improvements and a currency benefit from leveraging the global delivery resource model.

Question: What was the pre-tax margin of 2019?
Facts: 9.9%
Answer: 9.9%

Question: What was the External gross profit margin in 2019?
Facts: 27.7%
Answer: 27.7%

Question: What were the average External total gross profit?
Facts: 4,448; 4,606
Derivation: (4,606+4,448) / 2
Answer: 4527 million

Question: What was the increase / (decrease) in the Pre-tax income from 2018 to 2019?
Facts: 1,629; 1,666
Derivation: 1,666 - 1,629
Answer: 37 million

Question: What was the increase / (decrease) in the Pre-tax margin from 2018 to 2019?
Facts: 9.6; 9.9
Derivation: 9.9% - 9.6%
Answer: 0.3 percent

Question: What is included in Client solutions?
Facts: Client solutions often include IBM software and systems and other suppliers’ products if the client solution requires it.
Answer: Client solutions often include IBM software and systems and other suppliers’ products if the client solution requires it.

Question: What is included in Services?
Facts: For each of the segments that include services, Software-as-a-Service, consulting, education, training and other product-related services are included as services.
Answer: For each of the segments that include services, Software-as-a-Service, consulting, education, training and other product-related services are included as services.

Question: What is included in Software?
Facts: For each of these segments, software includes product license charges and ongoing subscriptions.
Answer: For each of these segments, software includes product license charges and ongoing subscriptions.

Question: What is the average of Financing under Global Financing?
Facts: 1,120; 1,167; 1,223
Derivation: (1,120+1,223+1,167 ) / 3
Answer: 1170 million

Question: What is the average of Used equipment sales?
Facts: 281; 366; 530
Derivation: (281+366+530) / 3
Answer: 392.33 million

Question: What is the increase/ (decrease) in Used equipment sales from 2018 to 2019
Facts: 281; 366
Derivation: 281-366 
Answer: -85 million

Question: What caused the total consolidated other (income) and expenses to decrease?
Facts: The year-to-year change was primarily driven by: • Lower non-operating retirement-related costs ($957 million). Refer to “Retirement-Related Plans” for additional information. • Higher gains from divestitures ($833 million) reflected in Other; and • Higher net exchange gains (including derivative instruments) ($272 million). The company’s hedging programs help mitigate currency impacts in the Consolidated Income Statement.
Answer: The year-to-year change was primarily driven by: • Lower non-operating retirement-related costs ($957 million). Refer to “Retirement-Related Plans” for additional information. • Higher gains from divestitures ($833 million) reflected in Other; and • Higher net exchange gains (including derivative instruments) ($272 million). The company’s hedging programs help mitigate currency impacts in the Consolidated Income Statement.

Question: What caused the Operating (non-GAAP) other (income) and expense to increase?
Facts: The year-to-year change was primarily driven by the same factors excluding lower non-operating retirement-related costs.
Answer: The year-to-year change was primarily driven by the same factors excluding lower non-operating retirement-related costs.

Question: What was the total Operating (non-GAAP) other (income) and expense in 2019?
Facts: $(1,431)
Answer: $(1,431) million

Question: What was the increase / (decrease) in the Foreign currency transaction losses/(gains) from 2018 to 2019?
Facts: 279; 427
Derivation: -279 - (-427)
Answer: 148 million

Question: What is the increase / (decrease) in the interest income from 2018 to 2019?
Facts: 264; 349
Derivation: -349 - (-264)
Answer: -85 million

Question: What is the average Acquisition-related charges?
Facts: 0; 154
Derivation: (154 + 0) / 2
Answer: 77 million

Question: What caused the increase in Cloud & Cognitive Software revenue in 2019?
Facts: There was strong growth in Cloud & Data Platforms, as reported and at constant currency, driven primarily by the acquisition of Red Hat in the third quarter of 2019. Red Hat had continued strong performance since the acquisition, in Red Hat Enterprise Linux (RHEL), application development and emerging technologies, led by OpenShift and Ansible.
Answer: There was strong growth in Cloud & Data Platforms, as reported and at constant currency, driven primarily by the acquisition of Red Hat in the third quarter of 2019. Red Hat had continued strong performance since the acquisition, in Red Hat Enterprise Linux (RHEL), application development and emerging technologies, led by OpenShift and Ansible.

Question: What caused the increase in Cognitive Applications revenue in 2019?
Facts: driven by double-digit growth as reported and adjusted for currency in Security, and growth in industry verticals such as IoT.
Answer: driven by double-digit growth as reported and adjusted for currency in Security, and growth in industry verticals such as IoT.

Question: What caused the increase in Cloud & Data Platforms revenue in 2019?
Facts: Performance was driven by the addition of RHEL and OpenShift and the continued execution of the combined Red Hat and IBM hybrid strategy.
Answer: Performance was driven by the addition of RHEL and OpenShift and the continued execution of the combined Red Hat and IBM hybrid strategy.

Question: What was the average Cloud & Cognitive Software external revenue in 2019 and 2018?
Facts: 22,209; 23,200
Derivation: (23,200 + 22,209) / 2
Answer: 22704.5 million

Question: What percentage of Cloud & Cognitive Software external revenue was Transaction Processing Platforms in 2019?
Facts: 23,200; 7,936
Derivation: 7,936 / 23,200
Answer: 34.21 percent

Question: What is the average of Cloud & Data Platforms in 2019 and 2018?
Facts: 8,603; 9,499
Derivation: (9,499 + 8,603) / 2
Answer: 9051 million

Question: How much amount did the unrecognized tax benefits increased in 2019?
Facts: $387 million
Answer: $387 million

Question: What attributed to settlements and reductions to unrecognized tax benefits?
Facts: The settlements and reductions to unrecognized tax benefits for tax positions of prior years were primarily attributable to U.S. federal and state tax matters, non-U.S. audits and impacts due to lapse of statute of limitations.
Answer: The settlements and reductions to unrecognized tax benefits for tax positions of prior years were primarily attributable to U.S. federal and state tax matters, non-U.S. audits and impacts due to lapse of statute of limitations.

Question: In December 2019, how much reduction was associated to timing adjustments, U.S. tax credits, potential transfer pricing adjustments and state income taxes.
Facts: $584 million
Answer: $584 million

Question: What is the average of Balance at January 1?
Facts: 3,740; 6,759; 7,031
Derivation: (6,759+7,031+3,740) / 3
Answer: 5843.33 million

Question: What is the average of Balance at December 31?
Facts: 6,759; 7,031; 7,146
Derivation: (7,146+6,759+7,031) / 3
Answer: 6978.67 million

Question: What is the average of Settlements for the period 2018-19?
Facts: 181; 2; 286
Derivation: (-286+(-181)) / 2
Answer: -233.5 million

Question: What percentage of total revenue was Research, development and engineering (RD&E) expenses?
Facts: Research, development and engineering (RD&E) expense was 7.8 percent of revenue in 2019 and 6.8 percent of revenue in 2018.
Answer: Research, development and engineering (RD&E) expense was 7.8 percent of revenue in 2019 and 6.8 percent of revenue in 2018.

Question: What caused the increase in the RD&E expenses?
Facts: RD&E expense increased 11.3 percent in 2019 versus 2018 primarily driven by: • Higher spending (11 points) including investment in the z15 and Red Hat spending in the second half of 2019 (8 points); and • Higher acquisition-related charges associated with the Red Hat transaction (1 point); partially offset by • The effects of currency (1 point).
Answer: RD&E expense increased 11.3 percent in 2019 versus 2018 primarily driven by: • Higher spending (11 points) including investment in the z15 and Red Hat spending in the second half of 2019 (8 points); and • Higher acquisition-related charges associated with the Red Hat transaction (1 point); partially offset by • The effects of currency (1 point).

Question: What caused the Operating (non-GAAP) expense increase?
Facts: Operating (non-GAAP) expense increased 10.4 percent year to year primarily driven by the same factors excluding the acquisition-related charges associated with the Red Hat transaction.
Answer: Operating (non-GAAP) expense increased 10.4 percent year to year primarily driven by the same factors excluding the acquisition-related charges associated with the Red Hat transaction.

Question: What was the increase / (decrease) in the Total consolidated research, development and engineering from 2018 to 2019?
Facts: 5,379; 5,989
Derivation: 5,989 - 5,379
Answer: 610 million

Question: What was the average Acquisition-related charges?
Facts: 0; 53
Derivation: (-53 + 0) / 2
Answer: -26.5 million

Question: What was the Operating (non-GAAP) research, development and engineering average?
Facts: 5,379; 5,936
Derivation: (5,936 + 5,379) / 2
Answer: 5657.5 million

Question: What was the additional inclusion in net intangible asset balance due to foreign currency translation?
Facts: include a decrease of $42 million in net intangible asset balances due to foreign currency translation
Answer: include a decrease of $42 million in net intangible asset balances due to foreign currency translation

Question: What are the types of other intangibles?
Facts: Other intangibles are primarily acquired proprietary and nonproprietary business processes, methodologies and systems.
Answer: Other intangibles are primarily acquired proprietary and nonproprietary business processes, methodologies and systems.

Question: What was the gross carrying amount of total intangible assets in 2019?
Facts: $ 1,749
Answer: $ 1,749 million

Question: What is the increase / (decrease) in the net capitalized software from 2018 to 2019?
Facts: 1,006; 939
Derivation: 1,006 - 939
Answer: 67 million

Question: What is the average net client relationships in 2019 and 2018?
Facts: 7,488; 945
Derivation: (7,488 + 945) / 2
Answer: 4216.5 million

Question: What is the percentage increase / (decrease)  in net Completed technology from 2018 to 2019?
Facts: 4,861; 860
Derivation: (4,861 - 860)/860
Answer: 465.23 percent

Question: In 2019, which activity impacted the result?
Facts: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.
Answer: 2019 results were impacted by Red Hat purchase accounting and acquisition-related activity.

Question: What caused the gross profit margin decline in 2019?
Facts: The gross profit margin decline was driven by the purchase price accounting impacts from the Red Hat acquisition.
Answer: The gross profit margin decline was driven by the purchase price accounting impacts from the Red Hat acquisition.

Question: What was the decrease in Pre-tax income in 2019?
Facts: Pre-tax income of $7,952 million decreased 10.5 percent compared to the prior year with a pre-tax margin decline of 4.4 points to 30.6 percent which reflects the acquisition of Red Hat, ongoing investments in key strategic areas and lower income from IP partnership agreements.
Answer: Pre-tax income of $7,952 million decreased 10.5 percent compared to the prior year with a pre-tax margin decline of 4.4 points to 30.6 percent which reflects the acquisition of Red Hat, ongoing investments in key strategic areas and lower income from IP partnership agreements.

Question: What was the average External gross profit in 2019 and 2018?
Facts: 17,224; 17,790
Derivation: (17,790 + 17,224) / 2
Answer: 17507 million

Question: What was the increase / (decrease) in the Pre-tax income from 2018 to 2019?
Facts: 7,952; 8,882
Derivation: 7,952 - 8,882
Answer: -930 million

Question: What was the average Pre tax margin in 2018 and 2019?
Facts: 2; 30.6; 35.0
Derivation: (30.6% + 35.0%) / 2
Answer: 32.8 percent

Question: What caused the increase in the Systems gross profit margin?
Facts: The increase was driven by actions taken in 2018 to better position the cost structure over the longer term, a mix to IBM Z hardware and operating systems and margin improvement in Storage Systems.
Answer: The increase was driven by actions taken in 2018 to better position the cost structure over the longer term, a mix to IBM Z hardware and operating systems and margin improvement in Storage Systems.

Question: What caused the decrease in the Pre-tax income?
Facts: driven by the declines in Power Systems and Storage Systems revenue and the continued investment in innovation across the Systems portfolio, mitigated by the benefit from the new hardware launches in the second-half 2019.
Answer: driven by the declines in Power Systems and Storage Systems revenue and the continued investment in innovation across the Systems portfolio, mitigated by the benefit from the new hardware launches in the second-half 2019.

Question: What was the Pre-tax margin in 2019?
Facts: 8.4%
Answer: 8.4%

Question: What was the average External Systems Hardware gross profit?
Facts: 2,590; 2,622
Derivation: (2,622 + 2,590) / 2
Answer: 2606 million

Question: What is the increase / (decrease) in the External Operating Systems Software gross profit from 2018 to 2019?
Facts: 1,412
Derivation: 1,412 - 1,412
Answer: 0 million

Question: What is the average Pre-tax income?
Facts: 701; 904
Derivation: (701 + 904) / 2
Answer: 802.5 million

Question: What caused the Systems Hardware revenue to decline?
Facts: driven primarily by declines in Power Systems and Storage Systems.
Answer: driven primarily by declines in Power Systems and Storage Systems.

Question: What caused the IBM Z revenue to decline?
Facts: IBM Z revenue decreased 1.1 percent as reported but was essentially flat adjusted for currency, reflecting the mainframe product cycles. Revenue declined through the first three quarters due to the end of the z14 product cycle, but there was strong growth in the fourth quarter driven by z15 shipments.
Answer: IBM Z revenue decreased 1.1 percent as reported but was essentially flat adjusted for currency, reflecting the mainframe product cycles. Revenue declined through the first three quarters due to the end of the z14 product cycle, but there was strong growth in the fourth quarter driven by z15 shipments.

Question: What caused the Power Systems revenue to decline?
Facts: due to the strong performance during the second half of 2018 driven by Linux and the introduction of the POWER9-based architecture in our mid-range and high-end products.
Answer: due to the strong performance during the second half of 2018 driven by Linux and the introduction of the POWER9-based architecture in our mid-range and high-end products.

Question: What is the average Systems external revenue?
Facts: 7,604; 8,034
Derivation: (7,604 + 8,034) / 2
Answer: 7819 million

Question: What is the average of Systems Hardware from 2018 to 2019?
Facts: 5,918; 6,363
Derivation: (5,918 + 6,363) / 2
Answer: 6140.5 million

Question: What is the increase / (decrease) in Operating Systems Software from 2018 to 2019?
Facts: 1,671; 1,686
Derivation: 1,686 - 1,671
Answer: 15 million

Question: What was the weighted average interest rate for commercial paper at December 31, 2019?
Facts: 1.6 percent
Answer: 1.6 percent

Question: What was the commercial paper in 2018?
Facts: $ 2,995
Answer: $ 2,995 million

Question: What was the increase / (decrease) in the short term loan from 2018 to 2019?
Facts: 161; 971
Derivation: 971 - 161
Answer: 810 million

Question: What was the average Long-term debt—current maturities?
Facts: 7,051; 7,522
Derivation: (7,522 + 7,051) / 2
Answer: 7286.5 million

Question: What was the percentage increase / (decrease) in total short term debt?
Facts: 10,207; 8,797
Derivation: 8,797 / 10,207 - 1
Answer: -13.81 percent

Question: What was the weighted average interest rate for short-term loans at December 31, 2019?
Facts: 6.1 percent
Answer: 6.1 percent

Question: What caused the decrease in the pre-tax income in 2019?
Facts: driven primarily by the decline in revenue and gross profit, and a higher level of workforce rebalancing charges in the current year.
Answer: driven primarily by the decline in revenue and gross profit, and a higher level of workforce rebalancing charges in the current year.

Question: What was the pre-tax margin of 2019?
Facts: 5.8%
Answer: 5.8%

Question: What were the steps taken by the firm to improve the cost effectiveness?
Facts: continued to take structural actions to improve our cost competitiveness and are accelerating the use of AI and automation in delivery operations, including leveraging Red Hat’s Ansible platform.
Answer: continued to take structural actions to improve our cost competitiveness and are accelerating the use of AI and automation in delivery operations, including leveraging Red Hat’s Ansible platform.

Question: What were the average External total gross profit?
Facts: 10,035; 9,515
Derivation: (9,515 + 10,035) / 2
Answer: 9775 million

Question: What was the increase / (decrease) rate in the Pre-tax income from 2018 to 2019?
Facts: 1,645; 1,781
Derivation: 1,645 / 1,781 - 1
Answer: -7.64 percent

Question: What was the increase / (decrease) in the Pre-tax margin from 2018 to 2019?
Facts: 5.8; 5.9
Derivation: 5.8% - 5.9%
Answer: -0.1 percent

Question: What was the decrease in Licensing of intellectual property?
Facts: 49.2 percent
Answer: 49.2 percent

Question: What caused the decrease in Licensing of intellectual property?
Facts: This was primarily due to a decline in new partnership agreements compared to the prior year. The timing and amount of licensing, sales or other transfers of IP may vary significantly from period to period depending upon the timing of licensing agreements, economic conditions, industry consolidation and the timing of new patents and know-how development.
Answer: This was primarily due to a decline in new partnership agreements compared to the prior year. The timing and amount of licensing, sales or other transfers of IP may vary significantly from period to period depending upon the timing of licensing agreements, economic conditions, industry consolidation and the timing of new patents and know-how development.

Question: What was the Custom development income in 2018?
Facts: 275
Answer: 275 million

Question: What was the Licensing of intellectual property including royalty-based fees average?
Facts: 367; 723
Derivation: (367 + 723) / 2
Answer: 545 million

Question: What was the increase / (decrease) in the Custom development income from 2018 to 2019?
Facts: 246; 275
Derivation: 246 - 275
Answer: -29 million

Question: What was the increase / (decrease) in the Sales/other transfers of intellectual property from 2018 to 2019?
Facts: 28; 34
Derivation: 34 - 28
Answer: 6 million

Question: What caused the increase in Global Business Services revenue?
Facts: driven by strong growth in Consulting, led by key offerings in digital Global Business Services revenue increased compared to 2017 driven by strong growth in Consulting, led by key offerings in digital and cloud application, where the business has brought together technology and industry expertise to help clients on their digital journey
Answer: driven by strong growth in Consulting, led by key offerings in digital Global Business Services revenue increased compared to 2017 driven by strong growth in Consulting, led by key offerings in digital and cloud application, where the business has brought together technology and industry expertise to help clients on their digital journey

Question: What was the impact on GPS and Application Management revenue?
Facts: GPS grew year to year, while Application Management revenue was flat as reported and declined adjusted for currency compared to 2017.
Answer: GPS grew year to year, while Application Management revenue was flat as reported and declined adjusted for currency compared to 2017.

Question: What was the percentage growth in GBS Cloud revenue?
Facts: 20 percent
Answer: 20 percent

Question: What is the increase / (decrease) in the Global Business Services external revenue from 2017 to 2018?
Facts: 16,073; 16,595
Derivation: 16,595 - 16,073
Answer: 522 million

Question: What is the average consulting?
Facts: 7,262; 7,705
Derivation: (7,705 + 7,262) / 2
Answer: 7483.5 million

Question: What percentage of total Global Business Services external revenue was Application Management in 2018?
Facts: 16,595; 7,705
Derivation: 7,705 / 16,595
Answer: 46.43 percent