IBM Slides 6.5% as BofA Flags $250M of Software Growth Tied to Delayed Q2 Deals
IBM sits 17% above its 52-week low of $199.19.
Summary
IBM shares dropped 6.5% premarket Thursday after BofA analysts estimated roughly $250 million of the quarter's software growth came from deals pushed out of Q2 — meaning the rebound looks thinner without that pull-forward. Management raised its annual software growth outlook to about 7%-8% from 6%-8% but left overall revenue growth guidance unchanged. Transaction processing software grew 9% in Q3, though CEO Arvind Krishna said he doesn't expect that pace to continue and sees more normalized performance into next year; Bernstein expects the unit to dip slightly in Q4 as the delayed-deal lift fades. The stock was already down about 15% this year through Wednesday, including July's record one-day drop after Krishna said IBM had "faltered" on shifting customer spending, and current losses would erase more than $15 billion in market value. At least eight brokerages raised price targets despite the pushback.
At the time of this announcement, IBM was trading at $232.15 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: Reuters.