Warnings of Earnings miss.
IBM shares slipped double digits in premarket trading after the firm released preliminary second-quarter results that fell short of expectations.
CEO Arvind Krishna blamed the shortfall on weakness in the software and infrastructure business because clients shifted money toward hardware purchases like memory chips.
What does "enterprise" even mean? IBM hasn't been in the consumer space since it sold the PC business over 2 decades ago and their SMB market has been channel partner driven for as long as I can remember. Global 2000 has always been IBM's target market and almost all their revenue, no idea what this "enterprise restructuring" talk is all about.
But but but:
IBM ISC IBM sales cloud said they had a pipeline of $400,000,000 for this qtr.
The "sales" people all sent out 200 spam emails last week. How many customers replied? Thats right zero.
IBM GSS Global sales school graduates were told they are the smartest people on the planet?
watsonx and Bob a thons were the job #1 not sales and not customer relationships.
@ad it’s already -33% in trading this morning. what’s to say it isn’t going to get worse.
so https://www.cnbc.com/quotes/IBM (6 month chart) says it’s -33.1258% from its 2 Jun 2026 52wk high of 329.23 as of this writing.
i guess Jun was the time to get out.
go figure.
Look at where the stock was just 2 years ago, mid 2024, which is when Arvind started his pump scheme. Around $165. That is where it's headed back to. Even that may be somewhat overvalued, as it spent most of the prior decade bouncing around between $120-150 and there hasn't been any real growth since then just acquisitions and divestitures.
@Af. Thus the restructuring around “enterprise”. IBM realizes they are all in on the “enterprise” strategy (eg farm the branch) as they have been stating that on earnings calls for the past 2 years. Their problem is even though they have been stating “enterprise” is our way forward, they have not been executing against it. NOW the rubber has met the road, and the market is forcing them to address it (most likely as a Gerstner type of restructuring). SW was restructured as a distribution play several years ago, and it’s holding up as IBM doesn’t have to innovate, but rather just has to buy innovative companies and use its worldwide sales force to distribute those innovative products. Consulting will have to restructure/downsize as its overhead vs the body shop consulting companies makes repeatable tasks far too expensive to execute thru IBM. Finally infrastructure will also have to restructure with the resulting organization having to put all of its remaining eggs into the “enterprise” and IP basket, as it can’t afford to play in cloud, scaleout, and specific parts of TSS anymore. The net result of all of this restructuring will be a downsizing of IBM along with its remaining support staff. COSTS will be cut to the bone, and IBM will emerge a much smaller and “enterprised” / IP focused company. Buckle up as it’s going to be a bumpy ride for the next year.
IBM has been a disaster waiting to happen ever since Arvind was elevated to generate fake profits. The stock price does not deserve to above $200. It no longer merits its historical price of $120-$160 either as Arvind has eaten all of the seed corn. Let's see it drop below $100 per share please.
It is a worthless shell of a company and should be sold for scrap.
@a5
That is too optimistic. It is going to be lower than $200
While the preliminary earnings show SW executing (+10%), infrastructure and Consulting continue to underperform, and major surgery is going to have to happen to right the ship
If you excised out Infrastructure and Consulting, SW would crash. Their products are mostly garbage and their sales organization is incompetent. They 100% depend on ELAs from Z upgrades and Consulting bringing them into clients, without those two channels they couldn't exist standalone.
Wow, even financial gymnastics couldn't save AK the wannabe CEO this time. Ginni R would be proud of her protege tanking IBM just like she used to.
A 3% miss in revenue and EPS leads to a 22% correction in share price. Thats some overvaluation. “Is this going to trigger an RA”. Oh you betcha a restructuring (a major charge off for those who have not lived thru Mr Gerstner’s 8.9 billion) is coming and your badges are not going to save you as IBM will offshore anything that’s not nailed down to cut costs to the bone. While the preliminary earnings show SW executing (+10%), infrastructure and Consulting continue to underperform, and major surgery is going to have to happen to right the ship. I expect consulting to be restructured around “enterprise” exclusively and for Z to get folded into that new entity. Everything non-enterprise is on the block along with all of the support infrastructure who will be offshored to the lowest bidder. Good luck to everyone as the next 6 months are going to see IBM shrink.
The problem is that no matter how much Arvind wants to convince the world that IBM is an AI company, a Quantum company, even just a modern software company, the truth is IBM is the same old mainframe company it has always been.
What's the problem, Z is old obsolete 1960s technology, who needs it in 2026 ? IBM has the Cloud, AI BOB and Quantum to fall back on.
No surprise... the software folks across the organization are busy playing with Bob which is a total waste of time and costs IBM millions to be paid to Anthropic. This Bob thing is a total distraction, reason why work does not get done!
Way to go Bob!
How many of us on here and elsewhere were dismissed as cranks for claiming Arvind has been cooking the books, a fact that is obvious to anyone who works at IBM at a high enough level to see the constant financial shenanigans from Kav and crew. I just can't figure out why AK would write this letter a week before earnings release. A miss is a miss whether news breaks this week or next. Only thing I can think of is that something much bigger is coming, and his statement that they're still working to close the books might be a clue - IBM's financial close process is extremely efficient and should have concluded already. Something big is coming.
Is this going to trigger an RA?
IBM has been a trader's stock for a long time. The stock rises and falls as traders pile on and price moves with buy and sell activity. However, it is NOT an investor's stock. There is no particular reason why anybody should hold IBM, and a lot of reasons to get rid of it.
Continue to sell the stock on rallies. Don't even think of buying and holding it.
Ah yes the excuse of people wanted hardware like chips and software.
Always an excuse with Alvind. Will he go crying on Cramers show this week ?
Expect the price to drop below $200 at the close today.
Our little tricks and buzz words and marketing spin can only work for so long. Eventually truth comes out. Data doesn’t lie and when rubber hits road we are not in good shape despite on the glorious accomplishments announced in last month
Next, come the PIP for hard working people. Not the slimy Indian and his cabal of thieves.
The slimy Indian at the top blames everyone else, not himself. The really want to keep his bonus (loot) of $100 Millions. He knows, he does not deserve a penny.