International Business Machines (NYSE:IBM) Releases Earnings Results, Meets Expectations

International Business Machines (NYSE:IBM) issued its quarterly earnings data on Wednesday. The technology company reported $2.93 earnings per share for the quarter, meeting analysts’ consensus estimates of $2.93, FiscalAI reports. The business had revenue of $17.16 billion during the quarter, compared to analysts’ expectations of $17.48 billion. International Business Machines had a return on equity of 37.23% and a net margin of 15.61%.The company’s revenue was up 1.1% on a year-over-year basis. During the same period in the previous year, the firm posted $2.80 earnings per share.

Here are the key takeaways from International Business Machines’ conference call:

• IBM said Q2 revenue growth of 1% missed expectations, with the shortfall concentrated in software after large deals slipped late in the quarter.
• Management believes most of the missed software deals were deferred rather than lost, noting about a third have already closed in early Q3 and that recurring software demand remained healthy.
• IBM raised its full-year revenue growth outlook to 4%–5% and kept its free cash flow target to grow by about $1 billion, citing strong productivity actions and improved operating leverage.
• Underlying businesses still showed strength, including Red Hat growth acceleration, record consulting signings with GenAI making up about half of signings, and distributed infrastructure posting record revenue growth.
• IBM reiterated confidence in its long-term growth engines, highlighting double-digit software growth potential, a strong IBM Z refresh cycle, and major investments in quantum and AI-driven security opportunities like Project Lightwell.

International Business Machines Trading Down 2.1%

IBM opened at $206.03 on Thursday. The business has a fifty day moving average price of $263.26 and a 200 day moving average price of $261.42. The company has a debt-to-equity ratio of 1.75, a current ratio of 0.80 and a quick ratio of 0.76. International Business Machines has a 12 month low of $204.44 and a 12 month high of $332.46. The stock has a market capitalization of $193.64 billion, a price-to-earnings ratio of 18.22, a PEG ratio of 2.27 and a beta of 0.68.

Hedge Funds Weigh In On International Business Machines

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Price T Rowe Associates Inc. MD increased its stake in shares of International Business Machines by 83.4% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 5,617,117 shares of the technology company’s stock worth $1,663,847,000 after buying an additional 2,553,552 shares during the period. Dimensional Fund Advisors LP increased its position in shares of International Business Machines by 0.6% in the 4th quarter. Dimensional Fund Advisors LP now owns 5,036,639 shares of the technology company’s stock valued at $1,492,090,000 after purchasing an additional 29,420 shares during the last quarter. Amundi increased its position in shares of International Business Machines by 17.9% in the 3rd quarter. Amundi now owns 4,777,516 shares of the technology company’s stock valued at $1,382,695,000 after purchasing an additional 725,191 shares during the last quarter. Raymond James Financial Inc. raised its holdings in shares of International Business Machines by 3.6% in the 2nd quarter. Raymond James Financial Inc. now owns 3,094,667 shares of the technology company’s stock valued at $912,245,000 after purchasing an additional 106,879 shares in the last quarter. Finally, California State Teachers Retirement System lifted its position in shares of International Business Machines by 0.6% during the 3rd quarter. California State Teachers Retirement System now owns 1,479,491 shares of the technology company’s stock worth $417,453,000 after purchasing an additional 8,238 shares during the last quarter. Hedge funds and other institutional investors own 58.96% of the company’s stock.

International Business Machines News Summary

Here are the key news stories impacting International Business Machines this week:

• Positive Sentiment: IBM said it will acquire HRL Laboratories, a private quantum research lab, to expand its quantum computing strategy and strengthen its work in silicon-spin qubits and quantum sensing. The deal may reinforce IBM’s long-term AI/quantum growth narrative. Article Title
• Positive Sentiment: Some analysts and market commentary say the post-earnings selloff may have been overdone, noting that delayed enterprise deals could still close and that IBM’s AI demand and free-cash-flow profile remain important longer-term supports. Article Title
• Positive Sentiment: IBM reported Q2 EPS of $2.93, matching estimates, and shares initially found support as investors focused on the company’s long-term AI and productivity initiatives rather than just the revenue miss. Article Title
• Neutral Sentiment: Robert W. Baird upgraded IBM to Hold, which may help stabilize sentiment but does not signal a strong bullish call. Article Title
• Negative Sentiment: IBM cut its full-year revenue growth outlook after a Q2 revenue miss, with management pointing to customer spending shifting toward AI infrastructure and a sharp drop in Z mainframe sales. That weaker guidance is the main reason the stock is down today. Article Title
• Negative Sentiment: Multiple reports highlighted that IBM’s mainframe revenue fell sharply and that the company’s trimmed 2026 outlook raises concern about near-term growth and execution, which continues to weigh on the shares. Article Title

Wall Street Analysts Forecast Growth

A number of brokerages recently commented on IBM. HSBC set a $175.00 target price on International Business Machines and gave the company a “reduce” rating in a report on Thursday, July 16th. Weiss Ratings cut shares of International Business Machines from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Wednesday, June 24th. Wedbush set a $350.00 price objective on shares of International Business Machines in a research note on Tuesday, June 2nd. Sanford C. Bernstein reissued a “market perform” rating on shares of International Business Machines in a research note on Thursday, July 16th. Finally, Needham & Company LLC assumed coverage on shares of International Business Machines in a report on Wednesday, June 3rd. They issued a “buy” rating for the company. Fifteen equities research analysts have rated the stock with a Buy rating, eleven have issued a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $278.68.

About International Business Machines

International Business Machines Corporation (IBM) is a global technology and consulting company headquartered in Armonk, New York. Founded in 1911 as the Computing-Tabulating-Recording Company (CTR) and renamed IBM in 1924, the company has evolved from early electromechanical machines to a diversified technology provider serving enterprises and governments worldwide. IBM is publicly traded on the New York Stock Exchange under the ticker symbol IBM.

IBM’s principal businesses encompass cloud computing and software, infrastructure and systems, consulting and technology services, and research and development.