IBM announced strong second quarter earnings for 2025, reporting revenues of $16.98 billion and earnings-per-share of $2.80, both surpassing expectations. Despite raising its full-year forecast for free cash flow, the stock fell over 8% due to software revenue that rose 10% but failed to meet analyst expectations of $7.43 billion. Chief Executive Arvind Krishna noted the importance of deep innovation and domain expertise in AI deployment, highlighting a generative AI business valued over $7.5 billion, while the market responded negatively to the software revenue shortfall.
IBM reported strong second-quarter earnings for 2025, with revenue hitting $16.98 billion, surpassing expectations. EPS was $2.80, exceeding the $2.64 prediction, prompting an increase in its full-year forecasts.
Despite significant achievements, IBM's stock dropped over 8% due to software revenue growth falling short of expectations, leading to concerns about the sustainability of its growth trajectory.
Chief Executive Arvind Krishna highlighted IBM's deep innovation and domain expertise as critical to client AI deployment and scaling, with their generative AI business now valued at over $7.5 billion.
The overall market perception was negatively impacted as software revenue rose about 10% to $7.39 billion, yet it did not meet the $7.43 billion anticipated by analysts.
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