IBM loses 25 percent and 73 dollars per share in a single day

IBM suffered the heaviest share price fall in its history on 14 July 2026. The share dropped 25.2 percent from 290.23 to 217.07 dollars. That is more than 73 dollars per share in a single trading day.

The previous record dated from 19 October 1987, when the paper lost 23.7 percent on Black Monday. The records go back to 1968, and IBM has been listed on the New York exchange since 1916.

The trigger was a preliminary profit warning. The group reported revenue of 17.2 billion dollars and adjusted earnings of 2.93 dollars per share for the second quarter. Expectations had been 17.86 billion dollars and 3.01 dollars.

The short version

• The share fell 25.2 percent on 14 July 2026 from 290.23 to 217.07 dollars, the heaviest single day loss in the history of the company.
• Second quarter revenue was 17.2 billion dollars and adjusted earnings 2.93 dollars per share, against expectations of 17.86 billion and 3.01 dollars.
• The previous record dated from 19 October 1987, when the paper lost 23.7 percent on Black Monday.

Customers bought hardware instead of software

Chief executive Arvind Krishna traced the shortfall back to a short term shift among customers. In the final weeks of June they had redirected their spending away from software and infrastructure and towards hardware such as servers, storage systems and memory chips.

The reason for that lies outside IBM. Anyone building capacity for artificial intelligence has to secure scarce hardware before prices rise further. Those purchases were pulled forward and other spending was postponed.

Several large deals in software and consulting therefore did not close before the end of the quarter.

Broken down, revenue rose one percent overall. Software gained five percent, consulting was flat, and infrastructure fell seven percent. In infrastructure there were also delays in the rollout of the z17 mainframe and higher chip costs.

The real shock lies in the gap to guidance

The figures alone do not explain the fall. Revenue 660 million dollars below expectations is no collapse at a group of this size.

What matters is the distance to the company own statement. At the analyst conference in April, finance chief Jim Kavanaugh had signalled currency adjusted revenue growth of more than five percent for 2026. The software division was to grow more than ten percent. For the second quarter a rate similar to the full year had been announced.

What was delivered was one percent. The first quarter had beaten estimates by 300 million dollars at 15.92 billion dollars.

The greatest worry among investors is whether the group will have to cut its full year guidance in the complete report.

Panic across the software sector

The warning worked far beyond IBM. On the same day software and consulting stocks came under pressure, among them several large providers of enterprise software and consulting houses.

The reason lies in the question IBM raised. If companies shift their technology budgets towards hardware, that hits every provider that lives from running software licences and consulting projects.

The timing is worth noting. On the same morning Goldman Sachs reported net revenue of 20.34 billion dollars, the strongest quarter in its 157 year history.

What happened afterwards

The complete quarterly report followed on 22 July. Until then it stayed open whether the full year targets would hold.

Since the start of the year the share stood 28 percent down after the fall. HSBC named a price target of 191 dollars. As a technical level a zone around 213 dollars was named, and below that 201 dollars.

For investors that leaves a question affecting the whole sector. Is the shift to hardware a one off pulling forward of purchases or the beginning of a lasting reallocation of technology budgets.

Frequently asked questions

What triggered the share price fall

A preliminary profit warning. Chief executive Arvind Krishna traced the shortfall back to customers redirecting their spending from software and infrastructure towards hardware in the final weeks of June. Several large deals in software and consulting therefore did not close before the end of the quarter.

Why was the gap to its own guidance so large

At the analyst conference in April, finance chief Jim Kavanaugh had signalled currency adjusted revenue growth of more than five percent for 2026, and the software division was to grow more than ten percent. What was delivered was one percent.

Why did the warning affect the whole software sector

If companies shift their technology budgets towards hardware, that hits every provider that lives from running software licences and consulting projects. On the same day several large providers of enterprise software and consulting houses came under pressure.

This analysis is for information only and is not investment advice.