UNITED STATES SECURITIES AND EXCHANGE COMMISSION …

1 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, DC 20549 FORM 10 - QQUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTER ENDED MARCH 31, 20171-2360( COMMISSION file number)INTERNATIONAL BUSINESS MACHINES CORPORATION(Exact name of registrant as specified in its charter)New York13-0871985(State of incorporation)(IRS employer identification number) Armonk, New York 10504(Address of principal executive offices) (Zip Code)914-499-1900(Registrant s telephone number) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section l3 or l5(d) of the SECURITIES EXCHANGE Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

2 Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T ( of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the EXCHANGE Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company)Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the EXCHANGE Act).

3 Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the EXCHANGE Act). Yes No The registrant had 939,496,884 shares of common stock outstanding at March 31, I - Financial Information:Item 1. Consolidated Financial Statements (Unaudited):Consolidated Statement of Earnings for the three months ended March 31, 2017 and 2016 3 Consolidated Statement of Comprehensive Income for the three months ended March 31, 2017 and 2016 4 Consolidated Statement of Financial Position at March 31, 2017 and December 31, 2016 5 Consolidated Statement of Cash Flows for the three months ended March 31, 2017 and 20167 Consolidated Statement of Changes in Equity for the three months ended March 31, 2017 and 20168 Notes to Consolidated Financial Statements9 Item 2.

4 Management s Discussion and Analysis of Results of Operations and Financial Condition40 Item 4. Controls and Procedures 69 Part II - Other Information: Item 1. Legal Proceedings69 Item 2. Unregistered Sales of Equity SECURITIES and Use of Proceeds and Issuer Repurchases of Equity SECURITIES 69 Item 6. Exhibits 70 Part I - Financial InformationItem 1. Consolidated Financial Statements:INTERNATIONAL BUSINESS MACHINES CORPORATION AND SUBSIDIARY COMPANIESCONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)3 Three Months Ended March 31,(Dollars in millions except per share amounts)20172016 Revenue:Services$12,342$12,391 Sales5,4045,879 Financing409 414 Total revenue18,15518,684 Cost:Services8,5538,382 Sales1,5511,378 Financing279238 Total cost10,3839,999 Gross profit7,7728,686 Expense and other (income).

5 Selling, general and administrative5,1526,012 Research, development and engineering1,533 1,458 Intellectual property and custom development income(445)(217)Other (income) and expense(28)253 Interest expense135147 Total expense and other (income)6,3487,652 Income from continuing operations before income taxes1,4241,034 Provision for/(benefit from) income taxes(329)(983)Income from continuing operations$1,753$2,016 Loss from discontinued operations, net of tax(3)(3)Net income$1,750$2,014 Earnings/(loss) per share of common stock:Assuming dilution: Continuing operations$ $ Discontinued $ $ : Continuing operations$ $ Discontinued $ $ number of common shares outstanding: (millions)Assuming dividend per common share$ $ (Amounts may not add due to rounding.)(The accompanying notes are an integral part of the financial statements.)

6 INTERNATIONAL BUSINESS MACHINES CORPORATION AND SUBSIDIARY COMPANIESCONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)4 Three Months Ended March 31,(Dollars in millions)20172016 Net income$1,750$2,014 Other comprehensive income/(loss), before tax:Foreign currency translation adjustments161239 Net changes related to available-for-sale SECURITIES :Unrealized gains/(losses) arising during the period(1)(36)Reclassification of (gains)/losses to net income137 Total net changes related to available-for-sale securities01 Unrealized gains/(losses) on cash flow hedges:Unrealized gains/(losses) arising during the period(33)(265)Reclassification of (gains)/losses to net income(98)(91)Total unrealized gains/(losses) on cash flow hedges(130)(356)Retirement-related benefit plans:Prior service costs/(credits)0-Net (losses)/gains arising during the period61(147)Curtailments and settlements(1)5 Amortization of prior service (credits)/costs(21)(25)Amortization of net (gains)/losses710690 Total retirement-related benefit plans748522 Other comprehensive income/(loss), before tax779406 Income tax (expense)/benefit related to items of other comprehensive income(92)202 Other comprehensive income/(loss)688608 Total comprehensive income/(loss)$2,438$2,622(Amounts may not add due to rounding.)

7 (The accompanying notes are an integral part of the financial statements.)INTERNATIONAL BUSINESS MACHINES CORPORATION AND SUBSIDIARY COMPANIESCONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)ASSETS5At March 31,At December 31,(Dollars in millions)20172016 Assets:Current assets:Cash and cash equivalents$10,096$7,826 Marketable securities599701 Notes and accounts receivable - trade (net of allowances of $302in 2017 and $290 in 2016)8,3779,182 Short-term financing receivables (net of allowances of $351 in 2017and $337 in 2016)16,36219,006 Other accounts receivable (net of allowances of $38 in 2017 and$48 in 2016)1,1301,057 Inventories, at lower of average cost or market:Finished goods423358 Work in process and raw materials1,1861,195 Total inventories1,6091,553 Prepaid expenses and other current assets4,7154,564 Total current assets42,88943,888 Property, plant and equipment30,68130,133 Less: Accumulated depreciation19,81619,303 Property, plant and equipment net10,86510,830 Long-term financing receivables (net of allowances of $99 in 2017and $101 in 2016)8,5029,021 Prepaid pension assets3,4913,034 Deferred taxes6,4575,224 Goodwill36,30736,199 Intangible assets net4,4364,688 Investments and sundry assets4,5494,585 Total assets$117,495$117,470(Amounts may not add due to rounding.)

8 (The accompanying notes are an integral part of the financial statements.)INTERNATIONAL BUSINESS MACHINES CORPORATION AND SUBSIDIARY COMPANIESCONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED) (UNAUDITED)LIABILITIES AND EQUITY6At March 31,At December 31,(Dollars in millions)20172016 Liabilities:Current liabilities: Taxes$2,747$3,235 Short-term debt8,3407,513 Accounts payable 5,3246,209 Compensation and benefits3,1973,577 Deferred income12,35111,035 Other accrued expenses and liabilities4,5224,705 Total current liabilities36,48136,275 Long-term debt34,44134,655 Retirement and nonpension postretirement benefit obligations16,96717,070 Deferred income3,5573,600 Other liabilities7,6017,477 Total liabilities99,04799,078 Equity:IBM stockholders equity:Common stock, par value $ per share, and additional paid-in capital54,10453,935 Shares authorized: 4,687,500,000 Shares issued:2017 - 2,226,175,9752016 - 2,225,116,815 Retained earnings153,292152,759 Treasury stock - at cost(160,359)(159,050)Shares:2017 - 1,286,679,0912016 - 1,279,249,412 Accumulated other comprehensive income/(loss) (28,710)(29,398)Total IBM stockholders equity18,32718,246 Noncontrolling interests121146 Total equity18,44818,392 Total liabilities and equity$117,495$117,470(Amounts may not add due to rounding.)

9 (The accompanying notes are an integral part of the financial statements.)INTERNATIONAL BUSINESS MACHINES CORPORATION AND SUBSIDIARY COMPANIESCONSOLIDATED STATEMENT OF CASH FLOWS(UNAUDITED)7 Three Months Ended March 31,(Dollars in millions)20172016 Cash flows from operating activities:Net income$1,750$2,014 Adjustments to reconcile net income to cash provided by operating activitiesDepreciation709677 Amortization of intangibles390347 Stock-based compensation129133 Net (gain)/loss on asset sales and other13172 Changes in operating assets and liabilities, net of acquisitions/divestitures9642,187* **Net cash provided by operating activities3,9555,530* **Cash flows from investing activities:Payments for property, plant and equipment(740)(956)Proceeds from disposition of property, plant and equipment58129 Investment in software(137)(144)Acquisition of businesses, net of cash acquired(109)(2,590)Divestitures of businesses, net of cash transferred(1)47 Non-operating finance receivables net1,5701,500*Purchases of marketable SECURITIES and other investments(1,273)(1,041)Proceeds from disposition of marketable SECURITIES and other investments9811,169 Net cash (used in)/provided by investing activities350(1,886)*Cash flows from financing activities.

10 Proceeds from new debt2,8878,085 Payments to settle debt(1,531)(2,211)Short-term borrowings/(repayments) less than 90 days net(880)(910)Common stock repurchases(1,293)(939)Common stock repurchases for tax withholdings(50)(27)**Common stock transactions other5459 Cash dividends paid(1,321)(1,250)Net cash (used in)/provided by financing activities(2,134)2,806**Effect of EXCHANGE rate changes on cash and cash equivalents100217 Net change in cash and cash equivalents2,2706,668 Cash and cash equivalents at January 17,8267,686 Cash and cash equivalents at March 31$10,096$14,354* Revised classification of certain financing receivables.** Reclassified to reflect adoption of the FASB guidance on share-based compensation.(Amounts may not add due to rounding.)(The accompanying notes are an integral part of the financial statements.)