International Business Machines Corp. is an information technology company, which provides integrated solutions that leverage information technology and knowledge of business processes. It operates through the following segments: Cognitive Solutions, Global Business Services, Technology Services & Cloud Platforms, Systems, and Global Financing. The Cognitive Solutions segment comprises a portfolio of capabilities that help IBM's clients to identify actionable insights and inform decision making for competitive advantage. It includes Watson, a cognitive computing platform that has the ability to interact in natural language, process amounts of big data, and learn from interactions with people and computers. This segment consists of Solutions Software, which provides the basis for many of the company's strategic areas including analytics, security and social; and Transaction Processing Software, which includes software that primarily runs mission-critical systems in industries such as banking, airlines and retail. The Global Business Services segment provides clients with consulting, application management and global process services. The Technology Services & Cloud Platforms segment provides comprehensive IT infrastructure and platform services that create business value for clients. The Systems segment provides clients with innovative infrastructure platforms to help meet the requirements of hybrid cloud and enterprise AI workload. The Global Financing segment encompasses two primary businesses: financing, primarily conducted through IBM Credit LLC, and remanufacturing and remarketing. The company was founded by Charles Ranlett Flint and Thomas J. Watson Sr. on June 16, 1911 and is headquartered in Armonk, NY.
In the third quarter, Global Financing total revenue of $645 million declined 11.2 percent compared to the prior year. Internal revenue decreased 10.6 percent, driven by a decrease in internal financing (down 21.7 percent to $86 million) and internal used equipment sales (down 5.2 percent to $216 million). External revenue decreased 11.7 percent (11 percent adjusted for currency), due to a decrease in external financing (down 14.6 percent to $261 million) and external used equipment sales (down 1.0 percent to $81 million).
The decrease in total revenue in the first nine months of 2019 compared to the same period of 2018 was due to a decrease in internal revenue of 28.7 percent, driven by a decrease in internal used equipment sales (down 36.0 percent to $593 million) and internal financing (down 7.4 percent to $291 million). External revenue decreased 7.4 percent (5 percent adjusted for currency), driven by a decline in external used equipment sales (down 19.9 percent to $216 million) and external financing (down 3.7 percent to $884 million).
The decrease in internal financing revenue in the third quarter and the first nine months of 2019 compared to the same periods in 2018 was primarily due to lower average asset balances, partially offset by higher asset yields. The decrease in external financing revenue in the third quarter and the first nine months of 2019 compared to the same periods in 2018 reflects the company’s wind down of the OEM IT commercial financing operations.