IBM shares fall 2.17% despite software-driven quarterly beat
IBM posted 5% revenue growth to $17.1 billion and a higher cash-flow outlook, but shares fell 2.17% to $246.01 on Thursday.
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what happened
Revenue for IBM's third quarter came in at $17.1 billion, a 5% increase, and the company said it expects full-year free cash flow to rise by more than $1 billion compared with last year. Even so, the stock traded at $246.01 around 10:30 a.m. ET on Thursday, down 2.17%, according to GuruFocus.
Software was the main engine: sales climbed 8% to $7.8 billion, Red Hat revenue rose 11%, and data offerings jumped 19%. The infrastructure unit added 4%, reaching $3.7 billion, while consulting was flat at $5.3 billion.
Per Reuters, as cited by GuruFocus, analysts question whether the software recovery can last, since part of the gain came from deals pushed over from the previous quarter.
why it matters
The shares sit only 1.05% above the $243.46 GF Value estimate, which points to roughly fair value rather than a clear discount. Investors will watch whether Red Hat keeps expanding, consulting regains momentum and the raised cash-flow forecast is delivered. One strong quarter does not settle the growth question.
market impact
IBM and enterprise software stocks: sentiment hinges on whether the software rebound proves durable.
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sources
- IBM Stocks Drop 2.17% Despite Software-Led Beat — gurufocus.com, 22 October 2026 at 19:09 UTC
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