Considering all the bad moves, very bad management, terrible treatment of employees who then go to competing companies where they are much happier, isn't it strange that IBM is not bankrupt already?
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It's called buybacks. Just keep pouring revenue into ja--ing the stock valuation instead of investing in the infrastructure. The exec's don't care because they will quit while ahead and publicly blame the collapse on their successors. It's ENRON 2.0.
My theory is that many of our dinosaur clients in highly regulated or low-innovation industries are happy to keep paying IBM for ongoing engagements. However, they aren't looking to grow, nor are they looking to take on digital transformation projects at scale. In other words, our clients want the status quo. Unfortunately, that doesn't lead to positive growth for IBM and we're so seemingly antiquated that newer companies with younger IT decision makers view us as a relic of their grandparents' generation.
No.
1gic You are closer to the pin than anyone when you say buyout. You would be better to say partnership
June, lol. In GBS err IBM Consulting we've been hearing for the last YEAR that we'll have more clarity on the new operating model in January. This company moves slower than a glacier. Why is everything always 6-18 months out and then nothing happens. Our customers and competitors aren't standing still.
strategy is ... We’ll know the answer to this by June
Wow I can't wait. I wonder if Wall Street can't wait either.
I think it is more likely that by June, whatever strategy they figured out pre-pandemic will be completely misaligned with the real world.
Execs are not there to make IBM better and bring it back to past glories... Execs are only there to pocket money and get rich. This constant restructuring (10+ years) is just a game to delay the inevitable so that the Execs pocket their money. None of these Execs have any clue on how to compete and fix a broken company. AK is no better, he is just as greedy as the others before him. IBM has probably another 10 years before it goes totally bankrupt, unless it gets bought out.
IBM had to do a lot of house cleaning when they spun off Kyndryl. 88.5K heads went to Kyndryl, but another large portion (3 billion) was set aside to streamline IBM. (most of that 3 billion was spent on aligning services and marketing toward enterprise engagements) That entailed a lot of layoffs and a lot of reshuffling as IBM also consolidated down to 3 divisions with more transparency. In 2022 IBM has already pre-announced another 1 billion spend to streamline (think head count reductions on the order of 12-15k). In addition to that IBM will exit certain markets via partnerships as they realize they can’t compete/make suitable margins/or just choose to not play, and thus a partnership (think give to get) makes far more sense. It appears each division from IBM will have to ante up approx 15k worth of heads into the partnership. Distributed infrastructure and infrastructure support from the “infrastructure division”, automation and Data & AI out of SW division (mostly centered around pieces of the business IBM wants to exit (Intel), and Redhat overlap with IBM legacy cloud products)), and Business transformation out of consulting division. Who would want to partner? Some one who can benefit via growing their open cloud and hosting IBM’s Niche cloud, while IBM labs do the leg work on competitive AI products. It’s a win win and dove tails nicely with what AK has been saying the go forward strategy is. We’ll know the answer to this by June, but IBM is aggressively moving toward a competitive enterprise strategy, because they missed the intel/public cloud opportunity
As someone already said, it's just a question of time. This year particularly look at the amount of dividends paid versus net income, the % will have never been so high. As far as balance sheet is concerned, the net book value of a share is already negative considering the non tangible assets that are goodwill. The best that can happen is a buyout, but at what price (in terms of dollars and pain for employees) ?
IBM is living on past glories and borrowed time. Unless someone starts cleaning house from the top-down and gets rid of all the completely useless "charts not parts" managers, develops a lucid strategy to provide products that customers really need instead of just selling the "brand", and makes it a decent place to work again, IBM will become just another has-been like Kodak, Xerox, and GE ... and it's already pretty far down that well-worn path on its way to oblivion. 😞
Like it or not they make billions upon billions in 90 days at a time.
IBM is morally bankrupt which is worse!!!
Just wait 'till they kick IBM out of the Dow!
Technically they have been bankrupt for years they just haven’t gotten around to telling the shareholders and employees yet.
It is only a question of time... IBM keeps on divesting businesses... One day there will be nothing left!
Been on its way since 2Q '93 and most def has been since about 3Q 2015. They just won't declare. Their true innovation lies in finacial engineering. Well, that and layoffs. They should be offering clients solution services around both.
I'm sure the debt is up there. It would be interesting to see the "real" balance sheet.