IBM: What Its Earnings Misses Say About the State of AI Right Now
If you want to know the tech sector's priorities, follow the money.
Overview
Typically, when a company releases preliminary financial results before its official earnings release date, it's not to brag. It's because it wants to cushion the looming blow for investors. And that's exactly what IBM (NYSE: IBM) did on Tuesday, releasing preliminary second-quarter results ahead of its scheduled earnings release on July 22.
IBM expects revenue of $17.2 billion (up 1% year over year) and adjusted earnings per share of $2.93. Both figures were below analysts' expectations, but the bigger problem for IBM is the "why" behind the shortfall: a shift in AI spending habits.
Details
IBM's leadership says that AI spenders are redirecting more of their budgets away from software and toward servers, storage, and memory, offering insight into the current state of AI development.
Source
Originally published at www.fool.com.