IBM CEO: Z Revenue Is "Deferred Not Destroyed"
Arvind Krishna said one-third of delayed deals have already returned, suggesting the mainframe miss will flow back into later quarters.
- On Thursday, IBM CEO Arvind Krishna confirmed that delayed enterprise software deals were deferred rather than lost, revealing one-third have already returned to the company after a disappointing second quarter.
- Enterprise clients temporarily prioritized purchases of physical servers and storage over software during the quarter as industry-wide chip price spikes forced budget reallocation to secure supply-constrained infrastructure.
- Software revenue grew 5% to $7.8 billion, while the infrastructure segment declined 7% to $3.8 billion, driven by IBM Z mainframe sales sliding 42% compared with the prior year.
- In a Thursday note, analysts at Jefferies cautioned against full optimism, recommending investors wait until delayed activity is reflected in reported results before celebrating the maintained guidance.
- IBM is pivoting toward AI-driven opportunities with the Mythos software release and expanded quantum technology investments, positioning the company in multibillion-dollar markets leadership believes will drive long-term growth.
11 Articles
11 Articles
IBM CEO addresses Wall Street tech panic after delayed enterprise software deals surge back
IBM CEO Arvind Krishna set the record straight over fears of a long-term tech slowdown, revealing that one-third of the major enterprise deals delayed during a rocky second quarter have since returned to the company.Speaking on "The Claman Countdown," Krishna explained that a major semiconductor price increase forced enterprise clients to briefly divert spending toward physical servers.While that spending shift hurt IBM’s upfront software sales,…
IBM insists AI didn't kill software deals, just delayed them
IBM is asking investors to view calendar Q2's software wobble as merely a temporary AI-induced panic attack, insisting the delayed deals that triggered one of its steepest stock slides in years are already starting to return. Just over a week after its preliminary results sent stock tumbling, Big Blue devoted much of its earnings call to arguing that nothing fundamental had changed. Customers hadn't abandoned software, executives insisted; they'…
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