IBM reported preliminary second-quarter revenue of $17.2 billion, falling short of analyst expectations, with the CEO describing the results as disappointing. The miss was driven by delayed closures on large deals and sluggish customer spending on AI infrastructure. The stock fell approximately 23%, approaching its worst single-day performance in nearly four decades, and HSBC followed with a downgrade and a lower price target citing valuation concerns.
A 23% single-day drop in a major tech stock signals something beyond a routine earnings miss. Investors holding IBM directly take an immediate hit, but the broader implication is that enterprise AI spending is not converting into revenue as quickly as the market assumed. That slowdown in large-deal closures is a warning sign for other IT services and consulting firms that have priced in aggressive AI adoption timelines.
IBM full Q2 earnings call: confirm exact date with IBM investor relations, expected within weeks of the preliminary release. Next comparable earnings: Accenture quarterly results and Salesforce quarterly results, both in the coming weeks. August CPI report, approximately August 12.
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