IBM 8-K

NegativeEarningsGuidance deferred to the call

Weaker Z and Transaction Processing, spending shifts to other infrastructure and delayed large-deal closings drove the shortfall.

Filed 2026-07-14 07:01 ET

Summary

Preliminary Q2 2026 results. IBM reported revenue growth of 1%, but said performance was below expectations, primarily because Z performance and related software—especially Transaction Processing—fell short, clients shifted spending toward other infrastructure purchases, and large deals closed later than expected. Final results could differ slightly; IBM plans to discuss full-year expectations on its 7/22/2026 earnings call.

Key Figures

Metric Q2 2026 Q2 2025 Y/Y YTD 2026
Revenue $17.2B — +1% —
Gross profit margin, GAAP 57.7% 58.8% -100 bp —
Gross profit margin, non-GAAP 59.4% 60.1% -70 bp —
Pre-tax income margin, GAAP 14.4% 15.3% -90 bp —
Pre-tax income margin, non-GAAP 19.2% 18.8% +30 bp —
Diluted EPS, GAAP $2.27 $2.31 -2% —
Diluted EPS, non-GAAP $2.93 $2.80 +5% —
Net cash from operating activities, GAAP — — — $7.77B
Free cash flow — — — $4.76B
  • The shortfall was driven mainly by weaker Z performance and associated software, client spending shifts toward servers, storage and memory, and large deals that did not close on schedule. Software revenue rose 5%, while Infrastructure revenue fell 7%.
  • Red Hat revenue growth accelerated to 11%; Distributed Infrastructure revenue rose 37% and exited the quarter with a ≈$500M backlog. IBM’s supplemental net cash from operating activities excluding IBM Financing receivables was $5.50B YTD.

Guidance

Guidance to be given on the earnings call.

Investor Takeaways

  • Watch the final Q2 results and IBM’s full-year expectations on the 7/22/2026 call; the preliminary figures may change slightly.

The summary is written by an AI model reading the filing.

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