IBM loses quarter of its value as tech giant’s shares plunge and profits falter
IBM shares fell over 25% following a disappointing second-quarter earnings report and a profit warning. The company cited a shift in corporate spending toward AI infrastructure and cybersecurity, which negatively impacted their traditional software and mainframe business.
Why it matters
The significant stock drop reflects broader market volatility and the disruptive impact of the AI hardware boom on legacy tech companies.
Signage for IBM outside the New York Stock Exchange on 7 July 2026 in New York City. Signage for IBM outside the New York Stock Exchange on 7 July 2026 in New York City. IBM IBM loses quarter of its value as tech giant’s shares plunge and profits falter IBM issued profit warning after weak second quarter, triggering selloff in software sector including Microsoft
Prefer the Guardian on Google Shares in IBM plunged more than 25% on Tuesday after the US tech giant released disappointing preliminary second-quarter results. IBM’s stock was on track for an even steeper single-day decline than it suffered during the 1987 “Black Monday” crash.
IBM had issued a profit warning and blamed shifts in corporate customers’ spending. The company said revenue for the three months ending in June came in at $17.2bn, up just 1% year-over-year.
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