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AI & Enterprise

IBM CEO says only 2 percent of software will be replaced by AI, seeks to calm market after weak results

IBM played down market concerns that generative AI will threaten its software business, saying only about 2 percent of its software could be replaced by AI and most products support customers’ AI use. CEO Arvind Krishna said IBM’s software enables real-time data use and lowers data-management costs. IBM shares are down about 30 percent this year. The company cited a mainframe slowdown and lowered its software growth outlook to 6 to 8 percent.

AI & Enterprise

IBM cuts 2026 revenue growth outlook

IBM cut its 2026 full-year revenue growth outlook. CNBC reported IBM forecast 4 to 5 percent revenue growth this year on a constant-currency basis, retreating from its April target of more than 5 percent. The move follows last week’s unusual preliminary release and warning, when CEO Arvind Krishna cited weak Z mainframe and transaction-processing software sales. Second-quarter profit slipped and infrastructure revenue fell, while software growth supported results. IBM reaffirmed its free cash flow outlook.

AI & Enterprise

IBM shares plunge as AI investment boom triggers record drop

IBM shares tumbled on July 14, posting their biggest one-day fall as the company warned that weak second-quarter results reflected a shift in corporate IT budgets toward AI infrastructure and cybersecurity. IBM said sales of its mainframes and related software were under pressure as customers increased spending on memory chips, servers and storage ahead of price rises. IBM reported second-quarter revenue of $17.2 billion, up 1 percent year on year, below expectations, while infrastructure revenue fell 7 percent.