Jan. 14 (Bloomberg) -- International Business Machines Corp., the world's biggest computer-services company, posted earnings and sales that topped analysts' projections as orders from Asia and Europe bolstered results.

IBM advanced 8 percent in early trading, which would be the most in more than five years if it holds when U.S. markets open. Fourth-quarter profit climbed to $2.80 a share and sales rose to $28.9 billion, exceeding predictions by more than $1 billion.

Business in Asia, Europe and developing countries drove results, Chief Executive Officer Samuel Palmisano said today in a statement. The remarks eased concern that slowing economic growth in the U.S. will drag down technology company profits and marked a reversal from the previous quarter, when IBM disappointed investors with slack hardware sales.

IBM rose $7.85 to $105.52 in early trading after closing at $97.67 on Jan. 11 on the New York Stock Exchange. The Armonk, New York-based company's shares climbed 11 percent last year.

Analysts anticipated profit from continuing operations of $2.60 a share and revenue of $27.7 billion, according to the average of estimates compiled by Bloomberg.

The company plans to report full results on Jan. 17.

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Palmisano increased IBM's staff in Brazil, Russia, India and China to about 100,000 as of December, seeking clients in countries where economic growth is outstripping the U.S.

Developing countries were IBM's fastest-growing source of business in the third quarter, with a 19 percent increase in sales across Brazil, Russia, India and China. European revenue followed with an 11 percent jump, trailed by the Asia-Pacific region at 9.4 percent and the Americas at 3.8 percent.

Last week, UBS analyst Benjamin Reitzes in New York cut his rating on IBM, saying the hardware and services businesses may be hurt amid the U.S. slowdown.

Of the 10 percent sales increase, 6 points came from currency benefits. The euro climbed 11 percent against the U.S. dollar in the year ended Dec. 31, boosting the value of sales made in Europe.

Technology spending probably will rise 5.5 percent this year, compared with a projected increase of 8 percent for 2007, Gartner Inc. said in an October report. Companies may cut spending to help cushion themselves from the risk of a recession, brought on by tightening credit markets.

IBM's third-quarter results had suffered from declining hardware revenue. Sales in that unit dropped 10 percent, failing to meet IBM's expectations. Chief Financial Officer Mark Loughridge said then that revenue in that unit may be little changed in the fourth quarter from a year earlier.

To contact the reporter on this story: Julie Alnwick in Toronto at jalnwick@bloomberg.net

Last Updated: January 14, 2008 08:45 EST