International Business Machines Corp. is exploring a possible sale of its IBM Watson Health business, according to people familiar with the matter, as the tech giant’s new CEO moves to streamline the company and become more competitive in cloud computing. .
IBM is studying alternatives for the unit that could include a sale to a private equity firm or industry player or a merger with a blank checking company, the people said. The unit, which uses artificial intelligence to help hospitals, insurers and pharmaceutical companies manage their data, has about $ 1 billion in annual revenue and is currently unprofitable, the people said.
Its brands include Merge Healthcare, which analyzes mammograms and MRIs; Phytel, who helps with patient communications; and Truven Health Analytics, which analyzes complex health data.
It’s unclear how much the business could get in a sale, and there may not be one.
IBM, with a market value of $ 108 billion, has lagged behind as cloud computing rivals Microsoft Corp. and Amazon.com Inc. skyrocket to valuations 10 times higher. The Armonk, NY company has said it is focused on boosting its hybrid cloud operations while exiting some unrelated businesses.