International Business Machines Corp's shares climbed 4 percent to $85.40 in after-hours trade from a regular close of $81.98.

The world's biggest manufacturer of mainframe computers and No. 2 software maker forecast on Tuesday 2009 earnings per share of least $9.20 versus a consensus of $8.77, according to Reuters Estimates.

The Armonk, New York company also said net income rose 12 percent to $4.43 billion, or $3.28 per share, in the fourth quarter ended December 31, from $3.95 billion, or $2.80 per share, a year earlier. That easily beat the average analyst forecast of $3.03.

Revenue fell 6.4 percent to $27.0 billion.

"IBM has enjoyed certain attributes that other tech stocks don't enjoy. They have recurring revenue streams that also translate into profitability," said Keith Wirtz, chief investment officer for Fifth Third Asset Management.

"That's great for IBM and that's one of the reasons why, in today's uncertain environment, IBM's a very attractive name to hold."

IBM shares rose $3.27 to $85.25 in extended trading. They had closed down 3.5 percent on the New York Stock Exchange.

(Reporting by Jim Finkle; editing by Richard Chang)