"International Business Machines Corp. ( NYSE: IBM) announced terrible quarterly results. Revenue rose only 9% to $16.3 billion. Earnings did rise to $1.87 from ($0.36), but it took a charge in the year-ago quarter that affected earnings. A better way to look at the numbers is operating (non-GAAP) pretax income from continuing operations, which was $3.0 billion, up from $2.5 billion in the same period of last year."
"There was some brief optimism about the company when it cut an artificial intelligence (AI) deal on October 7. This was a less-than-modest arrangement with Anthropic. That deal allows business customers access to Anthropic's Claude AI model, enabling IBM software to access an advanced AI tool. Many of IBM's customers are large companies, and the deal has little value to them."
"IBM is still, and has been for years, too small to matter as a partner. The company lost whatever clout it had decades ago. In 1980, IBM ranked ninth on the Fortune 500, America's largest companies based on revenue. Since then, it has missed the opportunity to lead in personal computers, PC operating systems, e-commerce, tech operating systems, search, and, more recently, AI. It is hard to find a tech company that lost that many chances to be a leader."
IBM's quarterly revenue increased 9% to $16.3 billion while reported earnings rose to $1.87 aided by a prior-year charge; operating (non-GAAP) pretax income from continuing operations was $3.0 billion, up from $2.5 billion. The stock fell nearly 7% after the results. A recent AI partnership with Anthropic gives business customers access to Claude but provides limited value to IBM's primarily large-company customer base. IBM's market capitalization of $267 billion trails AI leaders like OpenAI ($500 billion private valuation) and major public companies such as Nvidia and Microsoft, reflecting diminished competitive influence and missed leadership opportunities in multiple technology areas.
Read at 24/7 Wall St.
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