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IBM reports increases in earnings and revenue

NEW YORK (AP)— International Business Machines Corp. reported a small gain in third-quarter profits Monday, as increasing revenues in almost every area of the business, including emerging markets such as Russia and China, helped offset expenses from a pension lawsuit.

For the three months ending Sept. 30, IBM earned $1.80 billion, or $1.06 per share, compared to $1.79 billion, or $1.02 a share, at the same time a year ago.

Excluding a charge of $320 million, or 11 cents a diluted share, related to a pension lawsuit filed by retirees, the company earned $2 billion, or $1.17 per share. Analysts surveyed by Thomson First Call had predicted $1.14 per share.

"Industry growth is the best it's been since 2000," said the company's chief financial officer, Mark Loughridge.

Third-quarter revenues were $23.43 billion, compared to $21.52 billion for the same period last year.

Portions of the retiree lawsuit are still unresolved, and the company said in September, when it announced the $320 million charge, that it could face additional payments. The company and the plaintiffs reached an agreement in September that would cap IBM's total liability, including this charge, at $1.7 billion.

The company announced its results after the markets closed. IBM shares had ended the regular trading session up $1.07, or 1.3 percent, at $85.92 on the New York Stock Exchange. In the extended session, the shares rose another 2.4 percent, or $2.08.

IBM said growth in the United States was the strongest it has been in three years, but sales in Europe were nearly flat.