International Business Machines Corporation (NYSE:IBM) Q4 2019 Earnings Conference Call - Final Transcript
Jan 21, 2020 • 05:00 pm ET
James J. Kavanaugh
productivity and takes structural actions, especially in our GTS business. And remember, we'll continue to face year-to-year headwinds from the divested businesses, especially in the first half, and our P&L will also still have an impact from the Red Hat non-cash purchase accounting adjustments, though less than 2019. Looking at tax, we expect an operating tax rate in the range of 7% to 9%. Like 2019, that's an all-in rate, including an estimate of discrete items.
Putting all this together, we expect to deliver at least $13.35 of operating earnings per share for the year. Turning to free cash flow, we expect about $12.5 billion in 2020. Within that, we're expecting growth in capex, as we continue to build out cloud capacity. And as we said back in August, we expect Red Hat to be accretive to free cash flow, and that's net of the incremental interest expense.
With that, let me turn it back over to Patricia for the Q&A.
Thank you, Jim. Before we begin the Q&A, I'd like to mention a few items.
First, I'll remind you that the year-to-year growth rates, we're providing today for Red Hat are normalized to provide comparability to Red Hat's historical performance. Second, we have supplemental charts at the end of the slide deck that provide additional information on the quarter and the full year. And finally, as always, I ask you to refrain from multi-part questions.
So, Sheila, let's open it up for questions.