PCs and servers have never been a core IBM product. Their core product is the same as it's always been: enterprise consulting, and mainframes. Enterprise consulting is the biggest part now, although mainframes have long been effectively subsumed into that anyway (renting a mainframe is just part of a solution package).

They still make mainframes. They sold off everything hardware wise except for that. Per the article they signed an 10 year agreement with GF to supply POWER chips.

IBM is a software, service, SAAS, PAAS, and consulting company based on their website.

IAAS too (IBM SoftLayer).

"Enterprise solutions" (ie. consulting and expensive SaaS), as it has been for decades.

Things with better margins than hardware.

IBM has been exiting low margin businesses for years now so the chip announcement isn't that surprising. I don't see how cloud can be high margin because there is some serious competition in that market.

IBM has also been pushing hard into the information security market with the recent purchases of ISS (X-Force) and Q1 Labs (QRadar SIEM), both of which are insanely high-regarded products in the security space.