International Business Machines (NYSE:IBM) has teamed up with a Chinese telecom in a new mobile app partnership. The deal will allow the telecom to take advantage of the MobileFirst platform that allows businesses to make cost-effective, scalable applications on the cloud.
Both companies will work together to provide new, innovative solutions to businesses across China.
IBM stock rose to $159.82, or .40%, on the news.
The company is partnering with Chinese telecoms in an attempt to break through a lot of the political obstacles companies face when entering the market. Reports indicate that IBM is in talks with the largest cloud providers and fixed-line carriers in an attempt to further push the company’s products and services.
Many investors are unsure of the partnership with some viewing it as a weakness for IBM. The company’s stock performance has been disappointing this year, and the company’s net income has been on the decline. Analysts also note that IBM has a high debt management, which is a concern for the company.
Despite all of these negative points, IBM has a very high profit margin of 58.23%. Net profit margins of 22.73% are also well above the industry average, which is a benefit for stockholders and potential investors.