IBM reported another stellar quarter for its Power Systems line: In the third quarter of 2011, Power Systems accounted for 15 percent revenue growth over the same quarter last year, plus continued to hound HP and Oracle/Sun with 250 new competitive takeouts. Here’s the key references to IBM Power Systems, as noted by Mark Loughridge, IBM’s senior vice president and chief financial officer of Finance and Enterprise Transformation, in the IBM earning’s call with investors yesterday:

"Looking at the drivers of our performance. Our software profit was up 12 percent, driven by key branded middleware revenue growth of 17 percent. Hardware profit growth of 8 percent was led by Power Systems, where we had outstanding revenue growth and margin performance. We’re continuing to drive competitive displacements and extend our share gains in UNIX. Services delivered strong profit growth with pre-tax income up 13 percent in both segments. Services revenue growth was again led by growth markets, up double digits at constant currency."

An important side note comes from IBM’s revenue based on geography, where IBM reveals that not all of this Power Systems action is happening internationally: 

"Our geographic performance was again led by the growth markets and North America. I’ll discuss the geographic results on a local currency basis.

Revenue in our major market countries was essentially flat year to year. The US, our largest market, was up 4 percent and Canada was up 7 percent, driven by continued momentum in our software business and great performance in Power Systems. In Europe, we had good growth in Spain, which was up 9 percent, and in the UK, up 5 percent. We’ve now had 8 consecutive quarters of constant currency revenue growth in the UK.

Our growth markets again had fantastic performance, outpacing the majors by 12 points. With 13 percent revenue growth, this is the fifth consecutive quarter of double-digit revenue growth and share gains, compared to a strong third quarter last year. Performance was broad-based. As I mentioned, we had double-digit growth in 40 growth market countries, including each of the BRICs. Our success is broad-based from a segment perspective as well. In fact, growth markets led the performance in each segment, with strong growth and expected share gains in GTS, GBS, Software, and Systems and Technology. Within growth markets, we’re expanding into new countries and territories to reach new clients and enterprises. And so far this year, we have opened over 80 new branches."

IBM’s Power Systems made another sweet leap--in addition to revenue growth, the margin, the amount of profit IBM can attribute to Power Systems, rose nicely as well: 

"In Systems and Technology, we had double-digit growth in our growth markets, while major markets declined. As I mentioned earlier, we had terrific revenue growth and margin expansion in Power Systems, while our System z mainframe wrapped on new product introductions a year ago.

Turning to gross profit, our operating gross margin improved one and a half points with growth across our major segments. The largest contribution came from Systems and Technology which was up over 3 points, driven by improvements in Power, System z and System x."

Nice. 

And here’s the full Loughridge comments on the Systems and Technology segment for IBM:

"Moving on to Systems and Technology, revenue was $4.5 billion, up 4 percent, or 1 percent at constant currency, and profit was up 8 percent. Growth markets grew 12 percent at constant currency. This is the seventh consecutive quarter of double-digit growth in growth markets. Gross profit margin expanded 3.4 points to almost 40 percent, driven by margin expansion in Power, System z, and System x.

Now let me take you through the brands.

System z revenue declined 5 percent and MIPS were down 11 percent as we wrapped on the successful launch of our zEnterprise 196 in the third quarter of last year. Since the z196 started shipping a year ago, we have added over 80 new System z customers, with more than 30 percent of these in the growth markets.

We had great performance in Power, up 15 percent year to year. We have gained share in each of the last 14 quarters. And now, for the third consecutive quarter, IBM’s strong performance accounted for all of the UNIX industry’s growth. We continued our success in competitive takeouts. This quarter we had over 250 competitive displacements, which resulted in over $225 million of business. Roughly half of this business came from HP and the other half from Oracle/Sun.

Storage hardware revenue grew 8 percent year to year, with contributions from both disk and tape. When combined with storage software, total storage grew 12 percent this quarter.

System x revenue grew 1 percent. System x revenue in growth markets was up 15 percent at constant currency. This is the eighth consecutive quarter of double-digit revenue growth in growth markets.

Overall Systems & Technology revenue grew 4 percent, gross profit margin expanded over 3 points, and pre-tax income was up 8 percent."

For additional details, check out the IBM 3Q11 press release.