Fresh Hacker News | IBM is on pace for its worst day ever

▲IBM is on pace for its worst day ever(cnn.com)

34 points by 1970-01-01 4 hours ago | 9 comments

Worst day, so far* ;-)

▲Glandalf 4 minutes ago

What does IBM even do? Something with India, and servicing legacy no-bid government pork contracts, as far as I can tell. That appears to be the focus and has been for a long time.

▲MangoCoffee 35 minutes ago

its ironic that IBM sold off its x86 pc/server to Lenovo and kept their big iron (mainframe) but now everyone is buying up pc/server due to AI boom. Dell's stock have been surging with the rest of AI stocks

▲khurs 1 minute ago

They could have bought a pc company in 2022 when ChatGPT came out or anytime since.

But strategically they decided against a Hardware play and went for software:

2022- ChatGPT released

2023 - IBM buys Manta Software Inc undisclosed sum

2023 - IBM buys Software AG's StreamSets and webMethods $2.33 billion

2025- IBM buys Hashicorp $6.4 billion

2025 - IBM buys Confluent $11 billion.

▲trollbridge 11 minutes ago

Pretty sad that the company that invented DRAM completely divested itself of actually making any, now that it’s wildly profitable.

▲HumblyTossed 26 minutes ago

They just need to wait until nobody is selling or can buy new PCs and are forced to use outdated equipment to use as dumb terminals to access those mainframes.

▲jeffbee 6 minutes ago

I think it made sense on its own terms. They retrenched into the business where they are actually differentiated. It is notable that IBM net margins have been ~15% at best for decades. It's an odd business that is huge and just trucks along without remarkable growth. It is the butt of jokes but also a top 100 company by many measures.

▲rwmj 2 hours ago

The press release: https://newsroom.ibm.com/2026-07-14-Arvind-Krishnas-Letter-t...

With the caveat that I work for IBM but have no inside knowledge about anything important, it doesn't seem very bad to me? Overall profit is going to be down a tiny amount below expectations.

▲khurs 8 minutes ago

>In the last few weeks of June, we saw clients shift their quarterly capex spend toward servers, storage, and memory purchases to secure supply-constrained infrastructure ahead of expected price increases. This dynamic impacted client buying patterns. While we anticipated some supply chain related impact in our expectations, we did not anticipate the magnitude of the capex reprioritization. In addition, clients were distracted with rapidly-evolving, industry-wide cybersecurity concerns in the quarter.

▲bix6 34 minutes ago

If I read that as an IBM investor I might fully exit. The new product flopped, growth was 1%, and the CEO sounds extremely unconfident. There are way better places to put your money given the potential for future earnings now looks incredibly weak.

▲criddell 10 minutes ago

Where would you put your money? Everything in the US seems to have exposure to the AI bubble. Is Europe sitting out of the AI race? Maybe some euro etf?

▲Glandalf 2 minutes ago

COMEX is running lower on silver, their dumping is not sustainable. Could hit $500, $5000.

▲watwut 4 minutes ago

US recession will spread to everything and everyone, including or especially EU.

▲bionsystem 1 hour ago

Well, the answer is in your question, it's all about expectations ; the market wanted more, didn't get it, and re-rates.

▲rwmj 1 hour ago

Sure, but a prediction made 3 months ago turns out to be short by a few percent at most, and that leads to a 25%+ drop in the share price? That seems weird to me.

▲bionsystem 1 hour ago

What if the market expected 25% more then reported ? Nobody "knows" what the market expects. People infer it by looking at forward valuation, company guidance, investor expectations, and many many other things happening in the world, in competition, in the value chain. And of course the market does its thing and figures that this company has x% chance of beating (or missing) by $y, and when it's wrong the moves can be huge.

▲throwway120385 28 minutes ago

IME you have to be true to what you predict. Whether you're predictably growing, predictably shrinking, or predictably flat if you blow your prediction that's when people start to worry that you don't know what you're doing.

▲NetMageSCW 1 hour ago

Especially when the expectations are informed by the company’s own guidance about what to expect and they are wrong. It means they missed their own predictions which doesn’t engender confidence.

▲andrewstuart 18 minutes ago

And then bounces back.

Go buy it right now, profit tomorrow.

▲Glandalf 1 minute ago

Awful advice usually given by red-faced bag holders, lol. Wait for the real bottom, buy it IF it starts to recover.

▲ferminaut 1 hour ago

This was great timing for IBM employees with RSU's. Many folks had RSUs which literally unlocked this morning.

▲rwmj 1 hour ago

Great meaning bad?

▲antonyt 1 hour ago

Depends what happens next. RSUs are taxed as ordinary income at their market value at the time they vest, so it's not necessarily bad if the stock is down.

In fact, the ideal scenario is that the price drops just before your vest and then bounces back up after.

▲triceratops 41 minutes ago

If an employee periodically vests a fixed number of shares, as opposed to a fluctuating dollar amount of shares, this is actually untrue.

Assume an employee's marginal tax rate is 40% and their capital gains rate is 15%. Then there are 2 scenarios:

1. Vest 100 shares at $100 apiece. After tax that's 60 shares * $100 = $6000 total.

2. A sudden price drop causes 100 shares to vest at $50. After tax that's 60 shares * $50 = $3000. Later the price rises to $100 and the employee sells them. Another $3000 in capital gains, leaving $2550 after taxes. Total = $5250.

▲gruez 21 minutes ago

>2. A sudden price drop causes 100 shares to vest at $50. After tax that's 60 shares * $50 = $3000. [...]

This is only true if you "sell" 40 shares immediately at the time of vesting to pay the tax bill. Because you lose the 40 shares, you don't have as much shares to appreciate in the subsequent upswing. However if you prefer to settle your tax obligations in cash instead, you don't have this issue and you'd actually pay less taxes (assuming the upswing does materialize). It's risky though, because you're basically taking a long position on the stock, and if it falls even more, you'd lose even more money.

▲triceratops 20 minutes ago

> This is only true if you "sell" 40 shares immediately at the time of vesting to pay the tax bill

I wasn't aware there's a choice. That's a paycheck withholding essentially.

▲pxx 14 minutes ago

Paying taxes isn't optional. Sure you can invest more in the stock with external funds but that's not a fair proposition. If you were to tell me there's a certain chance of a stock going up by 100% we could also just buy calls with those magic funds and make far more money.

▲ 26 minutes ago

▲basiccalendar74 44 minutes ago

can you show the math for your last statement?

▲ChrisArchitect 29 minutes ago

All over the place in Big Blue land:

Jan 28: IBM Mainframe Business Jumps 67%

https://news.ycombinator.com/item?id=46802376

Feb 13: IBM tripling entry-level jobs after finding the limits of AI adoption

https://news.ycombinator.com/item?id=47009327

Feb 23: IBM Plunges After Anthropic's Latest Update Takes on COBOL

https://news.ycombinator.com/item?id=47128907

Apr 30: Granite 4.1: IBM's 8B Model Matching 32B MoE