IBM plunges after AI hardware spending crowds out software and infrastructure revenue

IBM issued preliminary second-quarter results below consensus as customers redirected budgets toward AI servers, storage and memory. The company expects approximately $17.2 billion of revenue versus an LSEG consensus near $17.86 billion and adjusted EPS of $2.93 versus roughly $3.02 expected. Reuters reported the shares down about 17% premarket, while CNBC’s feed headline subsequently described a decline exceeding 20%. CEO Arvind Krishna said numerous large deals did not close as expected.