IBM: Should Investors Buy the 25% Crash in the Stock or Stay Away?

Published July 17, 2026 · Category: Finance

Overview

IBM (NYSE: IBM) had one of the worst days in its long and storied history, with the stock crashing 25% on Tuesday after the company pre-announced disappointing second-quarter results. While the first instinct for many investors is to buy the dip, I would not be running out to buy shares right away. The poor report puts the company in the artificial intelligence (AI) loser bucket, and that has been a tough label for stocks to shake.

For Q2 (preliminary), IBM said its revenue edged up 1% year over year to $17.2 billion, well below the $17.86 billion consensus, as compiled by FactSet. Consulting revenue was flat on the quarter, while infrastructure revenue sank 7%. Software revenue, meanwhile, rose 5%. Red Hat was once again a bright spot, with revenue climbing 11%. Adjusted earnings per share (EPS) rose 5% to $2.93. However, it also fell short of the $3.01 analysts had expected.

Image source: The Motley Fool.

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Originally published at www.fool.com.

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