Sharp increases in sales and service revenues helped International Business Machines Corp. post a 7.2 percent increase in first-quarter earnings to $730 million ($1.25 a share) from $681 million ($1.17) in the same period last year. Revenues rose to $6.46 billion from $5.75 billion in the 1980 quarter.

And Westinghouse Electric Corp. said Thursday that its earnings rose 17.8 percent in the first three months this year to $118.5 million from $100.6 million in the first quarter of 1980 as sales and operating profits of the company's public systems and power systems divisions increased.

IBM reported a 4 percent gain in income from rentals of its data-processing equipment to $2.76 billion from $2.65 billion in the first quarter last year. Income from servicing the equipment it leases soared 28 percent to $1.23 billion from $964 million.

Equipment sales climbed nearly 16 percent to $2.47 billion from $2.13 billion. The company had sought to reverse a trend in recent quarters of making larger gains in rental fees at the expense of improvement in its sales volume. The first-quarter report indicates it succeeded. A higher ratio of sales to leases means income from a larger proportion of deliveries is recorded immediately, rather than spread out over several years.

IBM is the world's largest manufacturer of data-processing equipment. Information-processing accounts for about 80 percent of its revenues, while office products provide about 16 percent.

Westinghouse's profits amounted to $1.38 a share on sales of $2.2 billion. During the first quarter of 1980, the Pittsburgh-based manufacturer of electrical and mechanical equipment earned $1.18 a share on sales of $2 billion.