IBM reported second-quarter revenue and adjusted earnings that missed Wall Street expectations and lowered its full-year constant currency revenue growth forecast. Adjusted earnings per share came in at $2.93, below the $2.97 consensus, while revenue rose 1% year-over-year to $17.16 billion, missing the LSEG estimate of $17.58 billion. The company now expects full-year constant currency revenue growth of 4% to 5%, down from its prior outlook, while maintaining its free cash flow guidance for a roughly $1 billion year-over-year increase in 2026. Software revenue grew 5% to $7.8 billion, consulting revenue was flat at $5.3 billion, and infrastructure revenue declined 7% to $3.8 billion, with IBM Z revenue dropping 42%. CEO Arvind Krishna expressed confidence in the company's strategy and its positioning for an AI-driven future, while Jefferies analysts attributed the revenue miss primarily to weaker-than-expected software performance and noted that management views the shortfall as largely a timing issue.
International Business MachinesMissed Q2 revenue and earnings estimates and lowered full-year revenue growth outlook.