Analyst Consensus ?
ConsensusHold51 ratings
Bullish2447.1%
Neutral2243.1%
Bearish59.8%
International Business Machines Corporation · IBM · FY2026 Q2 · Calendar Q3 2026
IBM Q2 2026: Revenue Growth Cools to 1% as CapEx Deal Timing Masks Underlying Strength
IBM's Q2 2026 revenue growth decelerated to 1% year-over-year from 6% in Q1, as the timing of large CapEx-sensitive infrastructure deals offset the durability of recurring software revenue, which represents 80% of the software base, and a 37% surge in distributed infrastructure. EPS of $2.93 matched the consensus estimate exactly, while revenue of $17.16 billion fell 1.7% short of the $17.46 billion consensus. Management maintained full-year revenue guidance at 4%–5% and reiterated its $1 billion free-cash-flow growth target, characterizing the quarter's softness as deal-timing rather than demand erosion. The stock's abnormal move of +1.7% in the next session, followed by a +4.7% subsequent drift, is consistent with the market accepting that framing — though the deceleration from Q1's 6% growth and the drop in the bullish score from 80 to 70 warrant monitoring.
Reported After market closeNYSETechnology
$203.76B market cap
100quality score
Company context
Snapshot as of publicationInternational Business Machines Corporation (IBM) delivers comprehensive technology solutions and services across the globe. The company's operations are structured into four primary segments: Software, Consulting, Infrastructure, and Financing. The Software division provides hybrid cloud platforms and a range of software offerings, including Red Hat's enterprise open-source solutions. It also develops software for business automation, AIOps and management, integration, and application servers, in addition to data and artificial intelligence tools. This segment further supplies security software and services for threat, data, and identity management, and offers critical transaction processing software that supports essential on-premise workloads for industries such as banking, airlines, and retail.…
Earnings scorecard
Reported versus consensus
Reported EPS
$2.93
Consensus $3
EPS surprise
0.0%
Reported versus consensus
Reported revenue
$17.16B
Consensus $17.46B
Revenue surprise
-1.7%
Reported versus consensus
Earnings History
Estimate
Beat
Miss
Match
Analyst 52W Price Targets
$223.65Previous close
$112Low
$243.27Average
$380High
Latest persisted target per named analyst; persisted previous close from FN2's market snapshot as of Aug 1, 2026. Not an FN2 forecast.
Firm-level rating actions
FMP grade actions identify the grading firm, not a named analyst.
| Firm | Rating | Prior rating | Action | Date |
|---|---|---|---|---|
| Susquehanna | Neutral | Neutral | Maintain | Jul 24, 2026 |
| Citigroup | Buy | Buy | Maintain | Jul 24, 2026 |
| RBC Capital | Outperform | Outperform | Maintain | Jul 23, 2026 |
| Morgan Stanley | Equal Weight | Equal Weight | Maintain | Jul 23, 2026 |
| BMO Capital | Market Perform | Market Perform | Maintain | Jul 23, 2026 |
| Barclays | Overweight | Overweight | Maintain | Jul 23, 2026 |
| Jefferies | Buy | Buy | Maintain | Jul 21, 2026 |
| Stifel | Buy | Buy | Maintain | Jul 20, 2026 |
| JP Morgan | Overweight | Overweight | Maintain | Jul 17, 2026 |
| Evercore ISI Group | Outperform | Outperform | Maintain | Jul 16, 2026 |
| Argus Research | Buy | Buy | Maintain | Jul 16, 2026 |
| Oppenheimer | Outperform | Outperform | Maintain | Jul 14, 2026 |
| HSBC | Reduce | Hold | Downgrade | Jul 14, 2026 |
| B of A Securities | Buy | Buy | Maintain | Jul 6, 2026 |
| Wedbush | Outperform | Outperform | Maintain | May 29, 2026 |
| UBS | Neutral | Sell | Upgrade | Feb 25, 2026 |
| Goldman Sachs | Buy | Buy | Maintain | Jul 2, 2025 |
| Bernstein | Market Perform | Market Perform | Maintain | Jan 3, 2025 |
| Societe Generale | Sell | Hold | Downgrade | Jan 5, 2024 |
| Credit Suisse | Outperform | Outperform | Maintain | Jul 11, 2023 |
| Edward Jones | Hold | Buy | Downgrade | Feb 6, 2023 |
| MoffettNathanson | Market Perform | Underperform | Upgrade | Jan 19, 2023 |
| Tigress Financial | Neutral | Neutral | Maintain | Apr 21, 2022 |
| Wells Fargo | Equal Weight | Equal Weight | Maintain | Apr 14, 2020 |
| Nomura | Buy | Buy | Maintain | Mar 23, 2020 |
| Cantor Fitzgerald | Neutral | Neutral | Maintain | Jan 22, 2020 |
| Bank of America | Buy | Buy | Maintain | Aug 5, 2019 |
| Argus | Hold | Buy | Downgrade | Oct 18, 2018 |
| Moffett Nathanson | Sell | Sell | Maintain | Oct 4, 2018 |
| Stifel Nicolaus | Buy | Buy | Maintain | Jul 19, 2018 |
| Pivotal Research | Buy | Buy | Maintain | Oct 27, 2017 |
| Standpoint Research | Buy | Hold | Upgrade | Jul 19, 2017 |
| Pacific Crest | Equal Weight | Sector Weight | Maintain | May 19, 2017 |
| Berenberg | Sell | Sell | Maintain | Apr 4, 2017 |
| Guggenheim | Neutral | Neutral | Maintain | Jan 4, 2017 |
| JMP Securities | Market Outperform | Market Outperform | Maintain | Jul 19, 2016 |
| Drexel Hamilton | Buy | Buy | Maintain | Jul 19, 2016 |
| Deutsche Bank | Hold | Hold | Maintain | Jul 19, 2016 |
| Atlantic Equities | Underweight | Neutral | Downgrade | Mar 2, 2015 |
| Evercore Partners | Hold | Buy | Downgrade | Oct 21, 2014 |
| CLSA | Buy | Buy | Maintain | Sep 30, 2014 |
| J. Safra Sarasin | Neutral | Buy | Downgrade | Apr 24, 2014 |
| Cowen & Co. | Market Perform | Outperform | Downgrade | Dec 6, 2013 |
| Argus Capital | Hold | Buy | Downgrade | Oct 18, 2013 |
| S&P Capital IQ | Strong Buy | Buy | Upgrade | Sep 9, 2013 |
| Topeka | Buy | Buy | Maintain | Dec 21, 2012 |
| Janney Montgomery Scott | Neutral | Buy | Downgrade | Oct 17, 2012 |
| Janney Capital | Neutral | Buy | Downgrade | Oct 17, 2012 |
| Canaccord Genuity | Hold | Hold | Maintain | Apr 18, 2012 |
| Bank oferica | Neutral | Neutral | Maintain | Apr 4, 2012 |
| Oxen Group | Buy | Buy | Maintain | Mar 14, 2012 |
Named analyst price targets
Upside is calculated against the persisted previous close $223.65. FMP does not supply a rating on these named-analyst rows.
| Firm | Analyst | 52W target | Price when posted | Upside | Date |
|---|---|---|---|---|---|
| Susquehanna | James Friedman | $225 | $211.99 | +0.6% | Jul 24, 2026 |
| BMO Capital | Analyst unavailable | $230 | $203.62 | +2.8% | Jul 23, 2026 |
| Goldman Sachs | Analyst unavailable | $270 | $205.77 | +20.7% | Jul 23, 2026 |
| Morgan Stanley | Analyst unavailable | $190 | $205.77 | -15.0% | Jul 23, 2026 |
| Barclays | Analyst unavailable | $262 | $205.77 | +17.1% | Jul 23, 2026 |
| Robert W. Baird | Analyst unavailable | $230 | $210.5 | +2.8% | Jul 21, 2026 |
| RBC Capital | Matthew Swanson | $270 | $210.66 | +20.7% | Jul 21, 2026 |
| Barclays | Raimo Lenschow | $288 | $213 | +28.8% | Jul 21, 2026 |
| Jefferies | Brent Thill | $260 | $213 | +16.3% | Jul 21, 2026 |
| Stifel Nicolaus | David Grossman | $235 | $212.67 | +5.1% | Jul 20, 2026 |
| HSBC | Abhishek Shukla | $175 | $214.05 | -21.8% | Jul 16, 2026 |
| Argus Research | Jim Kelleher | $280 | $210.5 | +25.2% | Jul 16, 2026 |
| Oppenheimer | Analyst unavailable | $350 | $220.02 | +56.5% | Jul 14, 2026 |
| Morgan Stanley | Analyst unavailable | $293 | $290.23 | +31.0% | Jul 14, 2026 |
| HSBC | Analyst unavailable | $191 | $290.23 | -14.6% | Jul 14, 2026 |
| Susquehanna | Analyst unavailable | $303 | $295.3 | +35.5% | Jul 10, 2026 |
| Morgan Stanley | Analyst unavailable | $267 | $252.22 | +19.4% | Jun 23, 2026 |
| Wedbush | Analyst unavailable | $350 | $320.42 | +56.5% | Jun 2, 2026 |
| Barclays | Raimo Lenschow | $350 | $297.8 | +56.5% | Jun 1, 2026 |
| Stifel Nicolaus | David Grossman | $290 | $252.97 | +29.7% | May 22, 2026 |
| HSBC | Analyst unavailable | $231 | $228.05 | +3.3% | Apr 28, 2026 |
| Morgan Stanley | Analyst unavailable | $225 | $226.52 | +0.6% | Apr 23, 2026 |
| BMO Capital | Analyst unavailable | $270 | $224.71 | +20.7% | Apr 23, 2026 |
| Wedbush | Daniel Ives | $320 | $251.86 | +43.1% | Apr 23, 2026 |
| Jefferies | Analyst unavailable | $320 | $253.47 | +43.1% | Apr 20, 2026 |
| RBC Capital | Matthew Swanson | $330 | $253.25 | +47.6% | Apr 17, 2026 |
| Oppenheimer | Analyst unavailable | $320 | $247.36 | +43.1% | Apr 16, 2026 |
| Morgan Stanley | Erik Woodring | $215 | $237.82 | -3.9% | Apr 14, 2026 |
| Argus Research | Analyst unavailable | $360 | $304.06 | +61.0% | Jan 30, 2026 |
| UBS | Analyst unavailable | $345 | $303.99 | +54.3% | Jan 29, 2026 |
| RBC Capital | Matthew Swanson | $361 | $310.87 | +61.4% | Jan 29, 2026 |
| Oppenheimer | Param Singh | $380 | $314.15 | +69.9% | Jan 29, 2026 |
| Stifel Nicolaus | Analyst unavailable | $340 | $314.44 | +52.0% | Jan 29, 2026 |
| Evercore ISI | Analyst unavailable | $345 | $313.64 | +54.3% | Jan 29, 2026 |
| Wedbush | Daniel Ives | $340 | $294.16 | +52.0% | Jan 29, 2026 |
| BMO Capital | Keith Bachman | $350 | $294.16 | +56.5% | Jan 29, 2026 |
| UBS | Analyst unavailable | $317 | $312.54 | +41.7% | Jan 29, 2026 |
| UBS | David Vogt | $236 | $294.16 | +5.5% | Jan 29, 2026 |
| Morgan Stanley | Analyst unavailable | $304 | $294.16 | +35.9% | Jan 29, 2026 |
| Jefferies | Analyst unavailable | $370 | $294.16 | +65.4% | Jan 29, 2026 |
| Evercore ISI | Analyst unavailable | $330 | $305.67 | +47.6% | Jan 20, 2026 |
| RBC Capital | Analyst unavailable | $350 | $291.5 | +56.5% | Jan 5, 2026 |
| Jefferies | Analyst unavailable | $360 | $291.5 | +61.0% | Jan 5, 2026 |
| Stifel Nicolaus | David Grossman | $325 | $309.18 | +45.3% | Dec 9, 2025 |
| Oppenheimer | Analyst unavailable | $360 | $290.4 | +61.0% | Nov 21, 2025 |
| RBC Capital | Analyst unavailable | $300 | $277.58 | +34.1% | Oct 23, 2025 |
| Morgan Stanley | Analyst unavailable | $252 | $280.27 | +12.7% | Oct 23, 2025 |
| UBS | Analyst unavailable | $210 | $287.51 | -6.1% | Oct 23, 2025 |
| BMO Capital | Analyst unavailable | $305 | $287.51 | +36.4% | Oct 23, 2025 |
| Stifel Nicolaus | David Grossman | $295 | $287.51 | +31.9% | Oct 23, 2025 |
| Jefferies | Brent Thill | $305 | $283.65 | +36.4% | Oct 21, 2025 |
| Jefferies | Brent Thill | $300 | $283.65 | +34.1% | Oct 21, 2025 |
| Morgan Stanley | Erik Woodring | $256 | $276.15 | +14.5% | Oct 15, 2025 |
| KGI Securities | Rob Chang | $242 | $229.33 | +8.2% | Apr 24, 2025 |
| UBS | David Vogt | $170 | $229.33 | -24.0% | Apr 24, 2025 |
| Loop Capital Markets | Keith Bachman | $260 | $217.63 | +16.3% | Oct 24, 2024 |
| BMO Capital | Keith Bachman | $260 | $216.94 | +16.3% | Oct 24, 2024 |
| Goldman Sachs | James Schneider | $250 | $232.75 | +11.8% | Oct 24, 2024 |
| Stifel Nicolaus | David Grossman | $246 | $232.96 | +10.0% | Oct 16, 2024 |
| Evercore ISI | Amit Daryanani | $240 | $220.84 | +7.3% | Sep 27, 2024 |
| Bernstein | Toni Sacconaghi | $185 | $220.97 | -17.3% | Sep 25, 2024 |
| Jefferies | Brent Thill | $200 | $203.53 | -10.6% | Sep 10, 2024 |
| Needham | Matt Dezort | $256.79 | $130.75 | +14.8% | Aug 20, 2024 |
| Stifel Nicolaus | David Grossman | $205 | $184.02 | -8.3% | Jul 25, 2024 |
| J.P. Morgan | Brian Essex | $185 | $174.95 | -17.3% | Jul 2, 2024 |
| RBC Capital | Matthew Swanson | $200 | $173.25 | -10.6% | May 22, 2024 |
| BMO Capital | Keith Bachman | $190 | $167.8 | -15.0% | Apr 25, 2024 |
| Morgan Stanley | Erik Woodring | $179 | $184.1 | -20.0% | Apr 25, 2024 |
| Jefferies | Brent Thill | $190 | $184.1 | -15.0% | Apr 25, 2024 |
| Evercore ISI | Amit Daryanani | $215 | $184.1 | -3.9% | Apr 24, 2024 |
| Jefferies | Brent Thill | $210 | $181.9 | -6.1% | Apr 23, 2024 |
| BMO Capital | Keith Bachman | $210 | $189.82 | -6.1% | Apr 9, 2024 |
| RBC Capital | Matthew Swanson | $179 | $143.88 | -20.0% | Oct 26, 2023 |
| Loop Capital Markets | Keith Bachman | $152 | $137.9 | -32.0% | Jul 20, 2023 |
| Bernstein | Toni Sacconaghi | $145 | $127.08 | -35.2% | Apr 20, 2023 |
| Morgan Stanley | Erik Woodring | $143 | $130.42 | -36.1% | Apr 11, 2023 |
| Cantor Fitzgerald | Joseph Foresi | $138 | $131.22 | -38.3% | Feb 27, 2023 |
| Loop Capital Markets | Keith Bachman | $148 | $128.72 | -33.8% | Oct 20, 2022 |
| UBS | David Vogt Vogt | $112 | $121.63 | -49.9% | Sep 30, 2022 |
| Credit Suisse | Sami Badri | $156 | $130.79 | -30.2% | Jul 31, 2022 |
| Morgan Stanley | Analyst unavailable | $155 | $138.13 | -30.7% | Jul 19, 2022 |
| Tigress Financial | Analyst unavailable | $139 | $138.32 | -37.8% | Apr 21, 2022 |
| BMO Capital | Analyst unavailable | $152 | $136.82 | -32.0% | Apr 20, 2022 |
| Credit Suisse | Analyst unavailable | $166 | $135.96 | -25.8% | Apr 20, 2022 |
| Morgan Stanley | Erik Woodring | $157 | $129.15 | -29.8% | Apr 20, 2022 |
| Rosenblatt Securities | Analyst unavailable | $118.06 | $43.07 | -47.2% | Apr 19, 2022 |
| BMO Capital | Keith Bachman | $148 | $126.56 | -33.8% | Apr 17, 2022 |
| Morgan Stanley | Erik Woodring | $150 | $126.14 | -32.9% | Apr 14, 2022 |
| Evercore ISI | Amit Daryanani | $140 | $130.15 | -37.4% | Apr 3, 2022 |
| BMO Capital | Keith Bachman | $155 | $137.15 | -30.7% | Feb 5, 2022 |
| Credit Suisse | Sami Badri | $165 | $134.5 | -26.2% | Jan 28, 2022 |
| UBS | David Vogt | $118 | $134.48 | -47.2% | Jan 25, 2022 |
| Goldman Sachs | Brian Essex | $144 | $134.48 | -35.6% | Jan 25, 2022 |
| Morgan Stanley | Katy Huberty | $147 | $129.35 | -34.3% | Jan 22, 2022 |
| Goldman Sachs | Brian Essex | $140 | $134.21 | -37.4% | Jan 15, 2022 |
| Argus Research | Jim Kelleher | $165 | $133.39 | -26.2% | Oct 8, 2021 |
| Societe Generale | Richard Nguyen | $140 | $128.88 | -37.4% | Jul 20, 2021 |
| DZ BANK AG | Ingo Wermann | $155 | $130.72 | -30.7% | Apr 21, 2021 |
Track every rating change on IBM the moment it posts. Free to start.
Start freeMarket reaction
event-close to next-session close
Stock move
+0.4%
Event window
SPY move
-1.2%
Same window
Abnormal move
+1.7%
Stock minus SPY
Volume
1.2×
Versus trailing sessions
Subsequent drift
+4.7%
Up to 20 sessions
IBMSPY benchmark
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Try FN2 freeTranscript intelligence
What changed
Revenue growth slowed sharply from 6% in Q1 to 1% in Q2, driven by the timing of large CapEx-sensitive deals rather than recurring revenue weakness. The bullish score declined from 80 to 70, and the capex outlook shifted from increasing to decreasing. New product launches included Lightwell, an open-source remediation subscription service, and a smaller LinuxONE system to broaden the mainframe's addressable market. IBM announced a new pure-play quantum foundry with $1 billion in DOE incentives and $1 billion in IBM cash, alongside a $10 billion-plus five-year quantum investment plan. The Q1 highlight of IBM Z mainframe growing 48% gave way to a Q2 focus on z17 program-to-program performance of approximately 130% with strong AI workload adoption. Free cash flow for the first half was $4.8 billion, flat year-over-year, versus Q1's 13% FCF growth.
Guidance delta
FY 2026 revenue guidance was maintained at 4%–5%, compared with Q1's expressed confidence in exceeding 5% growth. The $1 billion free-cash-flow growth target was reiterated, alongside planned 100bp of operating-pretax margin expansion. Guidance sentiment was maintained.
Key takeaways
- Q2 revenue growth slowed to 1% YoY due to timing of large CapEx deals, but recurring software revenue (80% of software) remained healthy.
- EPS of $2.93 met consensus exactly; revenue of $17.16 billion missed estimates by 1.7%.
- Mainframe z17 program-to-program performance reached approximately 130% with strong AI workload adoption and no evidence of client migration.
- Distributed infrastructure revenue grew 37% YoY with a $500 million backlog signaling continued Power and Storage momentum.
- Free cash flow for the first half was $4.8 billion (flat YoY), with a $1 billion FY target and planned 100bp operating-pretax margin expansion.
Management priorities
- Scale Lightwell subscriptions and expand open-source remediation offerings.
- Deploy the new smaller LinuxONE system to broaden the mainframe addressable market.
- Advance the Anderson quantum foundry and invest over $10 billion in quantum over five years.
- Increase sales coverage to capture additional wallet share in AI, hybrid cloud, and infrastructure.
- Accelerate AI-driven productivity initiatives across software development, sales, and supply chain.
Sources
- Earnings call transcript and parsed analysis · 2026-07-23T14:03:55.688116+00:00
- FN2 earnings calendar · 2026-07-28T01:23:15.070317+00:00
- Polygon adjusted daily market bars · 2026-07-28T13:01:28.508216+00:00
- Financial Modeling Prep analyst price-target consensus and quote snapshot · 2026-07-28T13:01:28.505390+00:00
Methodology
Reported and consensus figures come from FN2's earnings event records. Market reaction and volume are calculated from daily adjusted bars around the event; abnormal move subtracts the SPY move over the same window.
Analyst target low, average, and high values are derived at request time from each named analyst's latest persisted FMP target. The current-price marker comes from FN2's persisted market snapshot. They are sell-side estimates, not an FN2 valuation or recommendation.
Transcript intelligence is a structured synthesis of the current and prior earnings-call analyses. Missing values stay missing and are never estimated.
By FN2 Research · Updated . For educational purposes only; not investment advice.