Latest news with #InternationalBusinessMachines
Yahoo
3 days ago
- Business
- Yahoo
IBM Stock Downgraded to $310 Target — But Bank of America Still Says Buy
International Business Machines Corporation (NYSE:IBM) is one of the . On July 24, Bank of America reiterated the stock as 'Buy' and lowered the firm's price target on IBM (IBM) to $310 from $320 following a 'mixed quarter.' The bank said that IBM is well-positioned for growth following its most recent financial report. The company reported adjusted earnings per share of $2.80 for the quarter, beating the LSEG estimate of $2.64. Meanwhile, revenue came in at $16.98 billion, ahead of the expected $16.59 billion. 'IBM reported a mixed quarter, where organic software deceleration was offset by strong contribution from better-than-expected Infrastructure results and higher M & A contribution.' A closeup of a woman's hands typing rapidly on a laptop in a corporate office setting. The firm believes that, post-earnings, IBM has turned into a 'show me' story on software in the second half of the year, but remains bullish on the overall company trajectory. The analysts further stated that they believe estimates will move higher this year and next year, 'with increasing contribution from high-margin software.' International Business Machines Corporation (NYSE:IBM) is a multinational technology company and a pioneer in artificial intelligence, offering AI consulting services and a suite of AI software products. While we acknowledge the potential of IBM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and . Disclosure: None. Sign in to access your portfolio
Yahoo
3 days ago
- Business
- Yahoo
IBM Stock Downgraded to $310 Target — But Bank of America Still Says Buy
International Business Machines Corporation (NYSE:IBM) is one of the . On July 24, Bank of America reiterated the stock as 'Buy' and lowered the firm's price target on IBM (IBM) to $310 from $320 following a 'mixed quarter.' The bank said that IBM is well-positioned for growth following its most recent financial report. The company reported adjusted earnings per share of $2.80 for the quarter, beating the LSEG estimate of $2.64. Meanwhile, revenue came in at $16.98 billion, ahead of the expected $16.59 billion. 'IBM reported a mixed quarter, where organic software deceleration was offset by strong contribution from better-than-expected Infrastructure results and higher M & A contribution.' A closeup of a woman's hands typing rapidly on a laptop in a corporate office setting. The firm believes that, post-earnings, IBM has turned into a 'show me' story on software in the second half of the year, but remains bullish on the overall company trajectory. The analysts further stated that they believe estimates will move higher this year and next year, 'with increasing contribution from high-margin software.' International Business Machines Corporation (NYSE:IBM) is a multinational technology company and a pioneer in artificial intelligence, offering AI consulting services and a suite of AI software products. While we acknowledge the potential of IBM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and . Disclosure: None.
Business Insider
6 days ago
- Business
- Business Insider
International Business Machines (IBM): New Buy Recommendation for This Technology Giant
In a report released yesterday, Matthew Swanson from RBC Capital maintained a Buy rating on International Business Machines, with a price target of $315.00. The company's shares closed yesterday at $260.51. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. According to TipRanks, Swanson is a 3-star analyst with an average return of 2.4% and a 46.71% success rate. Swanson covers the Technology sector, focusing on stocks such as International Business Machines, DoubleVerify Holdings, and Zeta Global Holdings Corp. In addition to RBC Capital, International Business Machines also received a Buy from Bank of America Securities's Wamsi Mohan in a report issued yesterday. However, on the same day, BMO Capital maintained a Hold rating on International Business Machines (NYSE: IBM). Based on International Business Machines' latest earnings release for the quarter ending March 31, the company reported a quarterly revenue of $14.54 billion and a net profit of $1.06 billion. In comparison, last year the company earned a revenue of $14.46 billion and had a net profit of $1.61 billion
Business Times
6 days ago
- Business
- Business Times
IBM falls most in 15 months on tepid software sales
SHARES of International Business Machines declined the most since April 2024 after the company reported weaker-than-expected sales in its closely watched software segment disappointing investors who have grown increasingly optimistic about the business. Second-quarter software unit sales increased 10 per cent to US$7.39 billion, the company said in a statement on Wednesday, slightly below analysts' average estimate of US$7.49 billion. The company's consulting business, which has been experiencing a growth slump, generated a revenue bump of 3 per cent to US$5.31 billion. Investors have been enthusiastic about IBM's software business and the potential for future growth from artificial intelligence tools and quantum computing. The company's management has heralded software and services as the path to rejuvenation since the 1990s. However, only recently under chief executive officer Arvind Krishna has the approach really begun to materialise, with software now more than 40 per cent of the company's annual revenue. Bookings for the AI business have exceeded US$7.5 billion since mid-2023, the Armonk, New York-based company said. That is up from the US$6 billion IBM disclosed during its last quarterly earnings report in April. About 80 per cent of the bookings come from the consulting unit, with the rest from software. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The shares dropped 7.6 per cent to US$260.51 at the close on Thursday in New York. The stock has gained 19 per cent this year, outpacing many technology peers. Overall, revenue increased 8 per cent to US$17 billion in the period ended June 30, the company said Wednesday in a statement. Analysts, on average, estimated US$16.6 billion. Much of that performance was due to Big Blue's infrastructure unit. Sales in that division gained 14 per cent to US$4.14 billion, beating the US$3.66 billion anticipated by Wall Street. This is the strongest initial launch of a mainframe product in IBM's history, chief financial officer Jim Kavanaugh said in an interview. Demand is driven by large enterprises, particularly in the finance and retail industries, he said. Despite the top line strength, investors are likely to question how durable IBM's software growth is in the second half of the year, wrote Amit Daryanani, an analyst at Evercore ISI. On a call with analysts after the results were released, Kavanaugh said that Red Hat software sales should continue growing in the mid-teens. The group, which was acquired in 2019, posted 16 per cent growth in the second quarter. Profit, excluding some items, was US$2.80 per share, compared with the average estimate of US$2.62. Kavanaugh said IBM is targeting steeper cost reductions, which is helping improve margins. Technology vendors who sell to the US government have been anxious about the impact of cost cuts under the Trump administration. Kavanaugh said that some of IBM's federal contracts that were previously paused have been reinstated and no new contracts have been affected. IBM maintained its annual sales forecast of at least 5 per cent growth in constant currency. Free cash flow is projected to exceed US$13.5 billion, in line with analysts' estimates. BLOOMBERG
Globe and Mail
6 days ago
- Business
- Globe and Mail
IBM Posts 8 Percent Revenue Gain in Q2
Key Points - Non-GAAP earnings per share rose to $2.80, surpassing estimates by $0.15 in Q2 2025. - Revenue (GAAP) increased 8.0% to $17.0 billion in Q2 2025, driven by software and infrastructure growth. - Free cash flow was $2.8 billion for Q2 2025. The annual outlook was raised above $13.5 billion for FY2025. These 10 stocks could mint the next wave of millionaires › International Business Machines (NYSE:IBM), a global technology and consulting company known for its focus on enterprise software, hybrid cloud, and artificial intelligence solutions, released its Q2 2025 earnings on July 23, 2025. The results exceeded analyst expectations for both revenue (GAAP) and non-GAAP earnings per share. IBM reported $2.80 per share in non-GAAP earnings, ahead of the $2.65 estimate, and revenue of $17.0 billion, above the $16.59 billion GAAP estimate. The period showed notable year-over-year growth in several segments and broad-based improvements in margins, though growth in its consulting business remained modest. Management described the quarter as demonstrating progress along strategic priorities, particularly in hybrid cloud and AI, and raised its annual free cash flow outlook, indicating confidence in sustained cash generation and profit expansion. Metric Q2 2025 Q2 Estimate Q2 2024 Y/Y Change EPS (Non-GAAP) $2.80 $2.65 $2.43 15.2 % Revenue $17.0 billion $16.59 billion $15.77 billion 7.8 % Gross Profit Margin (Non-GAAP) 60.1 % 57.8 % 2.3 pp Pre-Tax Income Margin (Non-GAAP) 18.8 % 17.7 % 1.1 pp Free Cash Flow (Non-GAAP) $2.8 billion $2.61 billion 8.9 % Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report. Company Overview and Strategic Focus IBM operates as a broad-based technology provider. Its main businesses include enterprise software, consulting services, and IT infrastructure products like mainframes and cloud computing systems. The company serves a range of large organizations around the world, delivering solutions across hybrid cloud and artificial intelligence. Recently, IBM has zeroed in on hybrid cloud and AI as pillars of growth. AI, or artificial intelligence, powers automation, analytics, and advanced computing within IBM's offerings. The company's key success factors include driving adoption of these technologies, strengthening recurring revenue streams, and leveraging its strong research and development to innovate ahead of competitors. Quarter in Review: Business Segment Performance and Earnings Drivers Software led the way, with revenue up 9.6% for Q2 2025. It was propelled by hybrid cloud platforms (notably Red Hat software) and automation tools—both growing 16% year over year. The company reported a "generative AI book of business" now exceeding $7.5 billion as of Q2 2025. This reflects client demand for AI-driven solutions across its portfolio. Automation and data sub-segments also recorded high single- to double-digit gains. The consulting segment delivered a smaller increase in revenue of 3% year-over-year for Q2 2025. It was flat when adjusted for currency. Management noted ongoing caution in consulting spending, especially from government and federal clients, making it a segment exposed to macroeconomic slowdowns and client discretion. Despite moderate revenue gains, consulting's profit margin improved to 10.6% from 8.9% a year earlier (GAAP). The infrastructure segment, which includes IBM's mainframe and distributed IT hardware products, posted the strongest relative revenue growth at 13.6% for Q2 2025. Segment margin surged to 23.3%. A key driver was new mainframe launches under the IBM Z platform—a type of powerful computer system used for mission-critical workloads, particularly in banks and other large enterprises. Mainframe sales rose 70% year-over-year. Distributed infrastructure—which includes other servers and storage—declined by 15%, showing that product-cycle timing and customer refresh behaviors significantly shaped results this quarter. Outside these three core businesses, the financing division was mostly flat, remaining a minor contributor to corporate results. Research and development spending rose 14% year-over-year. There were no material one-time items distorting quarterly comparisons. The quarterly dividend was maintained at $1.68 per share. This marks more than a century of uninterrupted payments. Looking Forward: Guidance and Near-Term Priorities IBM raised its full-year 2025 free cash flow guidance to above $13.5 billion, indicating growing confidence in sustainable cash generation. Management expects revenue growth of at least 5% in constant currency for FY2025, with current exchange rates providing an estimated 1.5 percentage point tailwind to growth. Investors should continue to watch for trends in IBM's consulting business, which remains susceptible to short-term shifts in client demand. The company's upward guidance for cash flow will be tested by larger debt levels, as total debt rose to $64.2 billion. IBM's next quarters will also be influenced by the full impact of its new products, the integration of acquired businesses like HashiCorp, and ongoing investments in research and innovation. The quarterly dividend was maintained at $1.68 per share for Q3 2025. Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted. Where to invest $1,000 right now When our analyst team has a stock tip, it can pay to listen. 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