NYSE:IBM plunged ~25% after a surprise Q2 miss—revenue ~$17.2B, adj. EPS $2.93—as delayed deals, execution issues and client shifts to hardware pressured margins; options and analyst sentiment turned bearish even as IBM invests billions in quantum and faces breakup/activist speculation.

Previous Week Recap

  • IBM Revenue, Margin, Stock Drop: IBM pre-announced Q2 2026: revenue ~$17.2B, adj. EPS $2.93, pretax margin ~14.4%. Infrastructure revenue down ~7%, software up ~5%, consulting flat. Stock fell ~25%, wiping ~$69–70B market value.
  • IBM Options Slump, Volatile Swings: On July 17 IBM options swung sharply: deep OTM calls plunged (e.g., $300 to ~$0.01, $230 to ~$3.60), while $230 and $275 puts spiked to ~$11.59 and ~$52.60, respectively.
  • IBM Stock Plunges After Miss: IBM stock plunged about 25% after preliminary Q2 results missed expectations, triggering a sharp one-day selloff and heavy volume as investors digested the earnings shortfall.
  • Delays, Execution Lag Hit IBM: IBM missed quarterly targets as several large deals delayed, execution lagged and clients shifted spending to hardware. CEO Arvind Krishna noted impacts amid IBM’s AI and software growth strategy.
  • IBM, U.S. Commerce Quantum Foundry: IBM partners with U.S. Commerce to build Anderon, a quantum wafer foundry backed by $1B CHIPS incentives and $1B IBM cash; plans $10B+ quantum spend and target for fault‑tolerant quantum by 2029
  • JPMorgan Cuts IBM Target; No Revisions: JPMorgan cut IBM price target to $250 from $291, trimming its valuation by $41. No earnings revisions, commentary, or updated timing were provided.
  • Morgan Stanley: IBM Downward Path: Morgan Stanley says IBM shares have slid sharply and likely haven’t bottomed, citing customer shifts toward hardware and memory and forecasting multi-year headwinds and near-term weakness for IBM.
  • Breakup Talk, Management Progress: Traders watch IBM amid talks of breakup or activist interest and management plans to report progress in late July as it seeks to diversify revenue beyond a few large clients.

This is an AI-generated summary and may contain inaccuracies. Please verify any important information with the original sources.