NEW YORK (CNN/Money) - IBM on Wednesday said its third-quarter profit from continuing operations was 99 cents per share, beating most analysts' expectations.

At the same time, there was some confusion about the business forecast executives provided for the fourth quarter. At issue was whether the company would need the revenue and earnings from PwC Consulting, which it bought earlier this month, in order to meet Wall Street's consensus estimate for revenue growth of about 12 percent.

John Joyce, IBM's chief financial officer, said on a conference call that with the PwC Consulting purchase complete, the company will begin to benefit from its added revenue, expected to be about $1 billion in the fourth quarter.

However, he noted that most analysts' had not taken that additional revenue into account when they formulated their estimates. "After adjusting for that revenue and earnings impact, I am generally comfortable with the range of expectations for our performance in the fourth quarter," Joyce said.

Shares of IBM (IBM: Research, Estimates), the world's largest supplier of computer hardware and IT services, rose sharply in extended-hours trade Friday, gaining 7.6 percent to $69.99, suggesting that investors were pleased with the results and interpreted Joyce's remarks as an affirmation of Wall Street's most recent expectations.

Briefing.com late Wednesday said on its Web site that it had concluded that the company's fourth-quarter revenue guidance excluded PwC Consulting, and that therefore this was a "clean" comparison in which both IBM's guidance and analysts' consensus estimate excluded PwC revenue.

But an IBM spokeswoman, when asked for clarification of the company's guidance following the call, told CNN/Money that the anticipated 12 percent increase includes the additional $1 billion in revenue from PwC Consulting.

Bob Djurdjevic, president of Annex Research, a market research and consulting firm that does not trade the stocks or take short positions in any of the companies it follows, said he had expected IBM's services and consulting business would show a decline this year had it not been for the acquisition of PWC Consulting.

"What he is saying is we expect to meet the expectations thanks to this additional source of revenue, not from our existing ongoing operations," Djurdjevic said.

Even with the additional revenue from PwC, Djurdjevic said the company's outlook is dubious because it hinges largely on revenue growth in consulting and services, an industry that recently has shown signs of weakness.

EDS, the No. 2 supplier of IT consulting and services, last month warned of a wide quarterly revenue and profit shortfall, pinning the blame in large part on a near halt in new contract signings.

Although much of EDS' trouble appears to be company specific, during Wednesday's call, IBM's Joyce noted that many of his company's customers remain cautious about signing large services contracts.

Djurdjevic said that many customers also appear to be reneging on some existing deals with IBM and asking for others to be renegotiated, putting the company's outlook, which is tied largely to growth in services, at risk.

"It's an optimistic outlook based on hope and prayer rather than fact and reason," he said.

Other IBM watchers weren't quite as pessimistic about IBM's prospects.

Sam Albert, an independent IT industry analyst and management consultant, said IBM's recent strategic moves, including selling off its hard-disk drive business and purchasing PwC Consulting as well as a string of other recent acquisitions, put in a strong position to take advantage of the opportunities in the IT industry over the longer term.

"The third quarter was better than I had anticipated, and my feeling is that under the circumstances, IBM is making some very smart moves for the future," Albert said.

During the third quarter, IBM logged a profit, excluding the results from its money-losing hard-drive business, of $1.7 billion, or 99 cents per share.

The consensus estimate of analysts polled by First Call was for a profit of 96 cents per share. During last year's third-quarter, IBM logged earnings of 97 cents per share.

At $19.8 billion, IBM's third-quarter revenue from ongoing operations was flat with the year-ago quarter and slightly better than most analysts had expected.

The company's latest results exclude the hard-disk drive operations, which it is spinning off in a joint venture with Hitachi. Including those results, IBM's net income for the third quarter was $1.3 billion, or 76 cents per share, compared with $1.6 billion, or 90 cents per in the third quarter of 2001.

Total third-quarter revenue of $20.3 billion, which includes $498 million of revenue from the hard-disk drive unit, declined 1 percent from the third quarter of 2001.

IBM executives attributed the stronger-than-expected results in large part to cost cutting, which has included laying off thousands of employees, as well as stronger revenue from its Global Services unit.

Revenue from Global Services, including maintenance, rose 2.4 percent in the third quarter to $8.9 billion, IBM said. Some investors had been on edge in recent weeks in anticipation of IBM's services revenue in light of the EDS warning.

At the same time, IBM said revenue from its two other major business lines, computer hardware and software, declined from the year-ago period.

At $6.7 billion, computer hardware revenue fell 1 percent from the last year's third-quarter. Software sales fell 2.9 percent to $3.1 billion.

IBM executives asserted that they gained shares in some of their key markets, including database software and data-storage hardware.