IBM stock is having the worst day in its history after Q2 earnings warning

What happened

IBM preannounced Q2 2026 results on July 14, 2026: adjusted earnings of $2.93 per share on revenue of $17.2 billion — missing analyst expectations of $3.01 EPS and $17.9 billion revenue. Shares fell more than 25%, surpassing the prior worst single-day decline of 23.7% on October 19, 1987.

Context and impact

CEO Arvind Krishna acknowledged IBM failed to close large deals quickly enough as enterprise customers shift spending from software to AI hardware infrastructure (GPUs, memory). IBM's miss signals the AI boom primarily benefits chip makers and infrastructure players, not traditional IT vendors. Full Q2 report arrives July 22, 2026.

Details

• Q2 revenue: $17.2B vs. $17.9B expected
• Adjusted EPS: $2.93 vs. $3.01 expected
• Software: +5%, Consulting: flat, Infrastructure: -7%
• Stock decline of -25% is the worst single-day drop in IBM's 115-year history
• Salesforce fell 4%, Microsoft fell 3% in sympathy
• Micron +5%, Sandisk +6% (hardware players benefiting from the shift)