IBM shares move lower as company beats but opts to maintain guidance
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Investors have been attuned to mainframe disruption threats from artificial intelligence, but IBM posted 51% growth in Z mainframe hardware revenue.
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In this article IBM Follow your favorite stocks CREATE FREE ACCOUNT IBM CEO Arvind Krishna appears at a Diwali celebration in the Oval Office of the White House in Washington on Oct. 21, 2025. Allison Robbert | Bloomberg | Getty Images IBM shares sank 8% in extended trading on Wednesday after the hardware, software and consulting provider reported stronger-than-expected first-quarter results but maintained full-year guidance. Here's how the company did in comparison with LSEG consensus: Earnings per share: $1.91 adjusted vs. $1.81 expected Revenue: $15.92 billion vs. $15.62 billion expected IBM's revenue grew 9% year over year in the quarter, according to a statement . Net income of $1.22 billion, or $1.28 per share, increased from $1.06 billion, or $1.12 per share, in the fourth quarter of 2024. Adjusted earnings exclude acquisition-related adjustments. Management reiterated its view for 2026, including over 5% revenue growth at constant currency and a $1 billion increase to free cash flow. IBM's first-quarter software revenue grew 11% to $7.05 billion, higher than the $7.02 billion consensus among analysts polled by StreetAccount. Revenue from consulting, at $5.27 billion, was up 4%, coming in just shy of StreetAccount's $5.28 billion consensus. Read more CNBC tech news Nvidia backs AI company Vast Data at $30 billion valuation Google unveils chips for AI training and inference in latest shot at Nvidia SpaceX says it can buy Cursor later this year for $60 billion or pay $10 billion for 'our work together' Apple's elevation of silicon head Johny Srouji signals sprint to build in-house chips for all devices Infrastructure increased 15% to $3.33 billion, above the $3.16 billion StreetAccount consensus. IBM pointed to a 51% jump in Z mainframe hardware revenue. As of Wednesday's close, IBM shares had declined about 15% so far in 2026, while the S&P 500 index was up 4% in the same period. The stock dropped 13% in a single day in February after artificial intelligence m...
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