IBM Slides 4.6% Despite Q3 Beat as Margin Miss and Unchanged Guidance Disappoint
IBM sits 19% above its 52-week low of $199.19.
Summary
IBM beat Q3 estimates — adjusted EPS of $2.95 versus $2.86 consensus and revenue up 5% to $17.1 billion versus $16.82 billion expected — yet the stock is down 4.56% at $240.00 Thursday, giving back Wednesday's roughly 4% gain. The reversal came on the earnings call: CEO Arvind Krishna said corporate clients are growing concerned about whether AI spending is generating measurable returns. Adjusted gross margin of 58.5% missed the 59.1% consensus and consulting gross margin narrowed from the prior quarter. Management also left its full-year constant-currency growth target at 4%-5% instead of raising it after the beat, and a senior vice president disclosed cutting their stake by more than a third. The board declared a $1.69 quarterly dividend payable Dec. 10 to holders of record Nov. 10.
At the time of this announcement, IBM was trading at $237.51 on NYSE in the Technology sector, with a market capitalization of approximately $236.9B. The 52-week trading range was $199.19 to $332.46. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Benzinga.