IBM stockholders get rosy review

IBM Chairman Samuel Palmisano and CEO Ginni Rometty were the headliners at IBM’s annual shareholders’ meeting Tuesday in North Charleston.

Ginni Rometty’s first annual meeting of stockholders as IBM Corp.’s chief executive officer, held Tuesday in North Charleston, couldn’t have gone much better.

It didn’t hurt that the century-old computing company’s first female CEO had plenty of good news to report.

On top of record revenues, profits and earnings per share in 2011, Rometty revealed that IBM will be paying out a dime-per-share increase in dividends this quarter, from 75 cents to 85 cents, continuing a 96-year streak of returning such a bonus to stockholders.

From there, Rometty, who got her start as an engineer at IBM in 1981, laid out the plan for future growth and profits, including expanding in emerging international markets like Africa and continuing to leverage and analyze “big data.”

Following in the footsteps of current IBM Chairman Samuel Palmisano, Rometty said her goal is to “constantly reinvent the company.” Investors seemed to like what they heard.

Larry Silvestre, who worked at IBM from 1961 to 1991, traveled from Mobile, Ala., to the Charleston Area Convention Center with wife Jeanne “to hear the new CEO on her feet.”

“And I was very impressed with her,” Silvestre said.

Cornelis De Vente, who met his wife, Phyllis, on his first day at IBM in 1955 and traveled from Atlanta for the annual meeting, agreed.

“I know that Tom Watson Sr. would be totally proud,” De Vente said of IBM’s first chief executive. “It’s a great thing for the corporation.”

The morning event, which ran less than an hour, was what you might expect from “Big Blue,” a business machines company that has grown to more than 400,000 employees and $100 billion in annual revenues since its founding in 1911.

After giving up their cellphones and passing through a metal detector, attendees sat in an IBM-themed ballroom, with blue-tinted curtains and a pair of glowing company logos behind the speaker’s dais.

Palmisano, who was CEO from 2002 until last year, moved briskly through the program, including votes on IBM’s board of directors and a few stockholder proposals concerning the transparency of IBM’s advocacy and lobbying, before introducing Rometty.

In her speech and the question-and-answer session that followed, she spoke about the future promise of Watson, the computer that famously beat the finest human competition at the TV game show “Jeopardy!.”

After machines that could count and then those that could be programmed, Watson represents the third generation of computing.

“Watson embodies a system that can learn over time,” she said.

Its primary post-”Jeopardy!” use is in healthcare, helping doctors diagnose patients. IBM has an agreement with Memorial Sloan-Kettering Cancer Center and will target lung, breast and prostate cancers.

Financial services will come next, she said, hinting that Watson might eventually be able to tell banking customers what their “next best action” is at any given juncture.

Other major possibilities on IBM’s horizon include business analytics applied to social media, part of the “vast new natural resource” known as big data and the increasing share of the company’s business in so-called growth markets like Africa.

Palmisano, who chimed in frequently during the shareholder question session, likened the potential there to that of China 25 years ago. “We have the same hope for Africa maybe a quarter century from now,” he said.

He also handled some of the thornier questions, rejecting the idea of a stock split and offering no answer when asked about a cost-of-living increase for retirees and whether Rometty was offered membership to the exclusive, all-male Augusta National Golf Club during this year’s Masters tournament.

“Thank you for your very kind comment,” Palmisano said to the man who praised IBM then asked about the golf controversy.

“We were all curious when that would come up.”

IBM stockholders did the rejecting when it came to the two transparency proposals put forth by a Charleston-based investment group, with more than 90 percent voting against changes to IBM’s disclosure policies.

And in less than an hour, the meeting was over, allowing the IBM executives and board members, like Boeing CEO W. James McNerney, to go on their way and leaving shareholders, like 30-year IBMers and recent retirees Howard and Joyce Sykes, to take stock.

“I think IBM’s got a great future,” Howard Sykes said.

EDITOR’S NOTE: Earlier versions of this story incorrectly stated the amount of the increase in per-share dividends to be paid this quarter. The Post and Courier regrets the error.