CALIFORNIA, United States

IBM Corp says it managed a nine per cent increase in profit in the last quarter as the technology company’s revenue grew for the first time in a year and a half. IBM shares dipped in extended trading.

The revenue boost in the latest quarter, which ended December 31, was just under one per cent. And it was helped by currency fluctuations — at constant values for the dollar, IBM’s revenue would have dropped five per cent. But even the slight increase was notable because the last time IBM’s revenue had risen was the July-September quarter in 2008. Some analysts have been worried that IBM would have trouble continuing its streak of using cost cuts to squeeze out higher profits.

IBM said it earned US$4.8 billion, or US$3.59 per , in the last three months of 2009, up from US$4.4 billion, or US$3.27 per share, a year earlier. Analysts polled by Thomson Reuters expected US$3.47 per share.

Revenue was US$27.2 billion, versus US$27.0 billion in the fourth quarter of 2008. Analysts had expected flat revenue of US$27.0 billion.

IBM’s revenue in services and software rose, while hardware fell. However, the hardware division’s decline wasn’t as steep as in previous quarters.

IBM’s results don’t always track with the direction of the overall economy, but the higher revenue is a sign that corporations are resuming to normal patterns of spending on technology. IBM also said it signed US$18.8 billion in new services contracts in the quarter, up nine per cent from a year earlier. Revenue from those will contracts mostly will be booked in the coming years.

IBM said it expects profit of at least US$11 per share in 2010. That is higher than IBM’s previous prediction for US$10 to US$11 per share in profit.