IBM Q1 2026 earnings beat estimates but stock falls on guidance

1 month ago 21

Colleen Cabili

Thu, April 23, 2026 astatine 8:27 AM CDT 2 min read

IBM reported first-quarter gross of $15.92 billion, up 9% twelvemonth implicit year, topping expert expectations. Shares dropped 6% successful after-hours trading, a determination traders attributed to the company's determination to permission its full-year outlook successful place.

Against CNBC's reported statement of $15.62 cardinal successful gross and $1.81 successful adjusted net per share, IBM came successful up connected some counts, delivering $1.91 per stock connected an adjusted basis.

Full-year targets were near untouched, with IBM inactive projecting a escaped currency travel summation of astir $1 cardinal and constant-currency gross enlargement exceeding 5%. "I don't deliberation we've ever raised guidance successful a archetypal quarter," IBM CFO Jim Kavanaugh told analysts connected a league call, adding that executives judge the institution should beryllium "a prudent operator."

Software was the largest gross contributor astatine $7.05 billion, up 11% twelvemonth implicit year. A 51% surge successful Z mainframe hardware revenue, with the z17 exemplary pacing up of earlier merchandise cycles, pushed infrastructure income up 15% to $3.33 billion. Consulting gross grew 4% to $5.27 billion.

Free currency travel reached $2.22 cardinal successful the quarter, up $258 cardinal from the aforesaid play a twelvemonth earlier. IBM ended the 4th with $11.8 cardinal successful cash, restricted cash, and marketable securities, down $2.6 cardinal from year-end 2025. Total debt, including IBM Financing indebtedness of $12.8 billion, roseate to $66.4 billion.

IBM besides declared a quarterly currency dividend of $1.69 per communal share, payable June 10 to stockholders of grounds arsenic of May 8. The institution said it was the 31st consecutive twelvemonth it has raised its quarterly dividend.

The $11 cardinal Confluent deal, a information streaming bundle transaction that closed astir mid-March astatine astir 2 months up of its anticipated timeline, has not altered IBM's borderline targets; Kavanaugh said operating pre-tax borderline enlargement of astir 1% remains connected track.

Heading into Thursday's session, IBM had shed astir 15% of its worth since the commencement of 2026, a agelong during which the S&P 500 gained 4%.

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