IBM just had one of the worst days in its 114-year history. The company’s stock cratered roughly 25% on July 14, marking what appears to be its largest single-day decline since at least the 1960s.
The trigger was a set of preliminary Q2 2026 results that landed with a thud. Revenue came in at $17.2 billion, reflecting a mere 1% year-over-year growth when the market was expecting something closer to $17.86 billion, or roughly 5% growth. Adjusted earnings per share hit $2.93, also below the consensus estimate of approximately $3.02.
What went wrong at Big Blue
CEO Arvind Krishna pointed to two culprits: a shortfall in IBM’s Z mainframe systems and the associated software stack, plus a broader shift in customer spending priorities. Enterprises are apparently redirecting budgets toward AI hardware, driven by anticipated supply shortages and looming price hikes.
IBM’s full Q2 earnings report is scheduled for July 22, which means investors will spend the next week parsing whether the preliminary numbers tell the whole story or whether there are additional surprises lurking in the details.
