IBM's financial results for the Q2 of 2010 have dismayed the hopes of trade watchers at Wall Street expectations.

It was stated that the company is witnessing a slow growth in software sales and a net increase in income of 9 per cent mounting to $3.39 billion, or $2.65 per share. However, the revenue dropped to go with $24.2 billion estimated by analysts, which expectedly was $23.7 billion.

The company claims that the low revenue that came up was reported of direct loss of $500 million, was primarily due to unstable currency rates, a trend which was unnoticed by IBM analysts.

Adding to the tales of dismay for investors, IBM also claimed of 12 per cent dip in service contracts to $12.3 billion. Service contracts are believed to be a major source for any IT company, and it is also stated that the outsourced service contracts also droop by 19 percent.

The company stated that this is result of the shortfall that comes on an unusually high number of contract extensions that are agreed upon by a mutual agreement last year.

IBM claims of 14 per cent rise in business analytics software sales, and information system software also rose by 7 per cent which acts as the only savior to the recent mayhem.