IBM
IBM (International Business Machines Corporation) is an American multinational technology company headquartered in Armonk, New York, founded in 1911 as the Computing-Tabulating-Recording Company (C-T-R) and renamed in 1924. Under the 42-year leadership of Thomas J. Watson Sr., IBM grew from a maker of punched-card tabulating machines into a global force in information technology[^c1]. The company dominated the mainframe computer market with the System/360, survived a decade-long antitrust battle, lost its early lead in personal computers, and underwent a dramatic turnaround in the 1990s that shifted its focus from hardware to IT services and software[^c2]. In the 21st century, IBM repositioned itself as a platform company centered on hybrid cloud and artificial intelligence, anchored by the acquisition of Red Hat in 2019[^c3].
IBM Research, founded in 1945, has produced six Nobel Prizes and pioneered technologies including the relational database, DRAM, the hard disk drive, the scanning tunneling microscope, and both the Fortran programming language and the UPC barcode[^c4]. The company's culture, shaped by Watson's "THINK" slogan, emphasized salesmanship, employee education, and tackling "seemingly impossible tasks"[^c5]. IBM mainframes handle approximately 70 percent of the world's production IT workloads, and 45 of the top 50 banks run mainframes as their core platform[^c16][^c17].
In 2025, IBM generated $67.5 billion in revenue, with software accounting for approximately 45 percent of total revenue[^c6]. IBM's cumulative generative AI business reached $12.5 billion, backed by the watsonx platform, of which $4.5 billion came from internal deployment[^c15]. The company beat Wall Street expectations in the first quarter of 2026, reporting $15.92 billion in revenue, with software revenue up 11 percent and infrastructure revenue up 15 percent year-over-year[^c7]. Software has become IBM's primary revenue driver: approximately 70 percent of the company's top line comes from product sales, a reversal from several years prior when 70 percent was generated by services[^c26].
On July 14, 2026, IBM pre-announced preliminary second-quarter results that fell well short of Wall Street expectations. Stock fell as much as 26 percent in a single day, the worst one-day trading loss in the company's 115-year history[^c36]. Revenue grew just 1 percent year-over-year to $17.2 billion, with adjusted earnings per share of $2.27, well below the consensus estimate of $3.02. CEO Arvind Krishna attributed the shortfall to an abrupt shift in enterprise capital spending: in the final weeks of June, clients redirected quarterly budgets toward servers, storage, and memory to secure supply-constrained hardware ahead of expected price increases[^c37]. IBM's distributed infrastructure business, including Power servers and storage, grew 37 percent year-over-year — its best quarterly performance on record — while overall infrastructure revenue fell 7 percent as mainframe momentum faded[^c38].
At Think 2026, IBM introduced its AI Operating Model, a blueprint integrating data, agents, automation, and hybrid infrastructure to help enterprises run AI at the core of their business[^c13]. IBM Chairman and CEO Arvind Krishna stated that "true leaders are not focused on deploying more AI tools, but on redesigning their business operating models"[^c25]. IBM also launched IBM Bob, an AI-powered development partner that generates approximately 40 percent of IBM's internal code and is used by over 100,000 IBM employees daily, reporting an average productivity increase of 45 percent[^c18]. IBM Consulting simultaneously unveiled a Services-as-Software transformation, shifting from labor-based consulting to platform-leveraged, outcome-based engagements[^c14]. At the same event, IBM launched IBM Sovereign Core as a generally available software platform for building and operating AI-ready sovereign environments across hybrid infrastructure[^c33].
In July 2026, IBM released a second-generation version of Bob with multi-agent coordination capabilities and Bobalytics, a built-in AI cost and usage analytics tool[^c29]. Three Premium Packages were introduced for modernizing IBM Z, IBM i, and Java environments. In one deployment, Blue Pearl used Bob to complete a legacy modernization program originally projected to take nine months with 14 engineers in just three days. IBM also expanded its z17 and LinuxONE 5 portfolios with single-frame and rack-mount configurations, the first time rack-mount systems have been offered across the full Z and LinuxONE line[^c28]. The new systems support up to 82 cores and 18 TB of memory with the Telum II processor and Spyre Accelerator.
In July 2026, IBM expanded its Power server portfolio with the entry-level Power S1112, a single-socket Power11 system with on-chip Matrix Math Acceleration for local AI inference[^c39]. The company also introduced IBM Power Autonomous Operations, an AI agent that monitors Power systems and resolves capacity issues autonomously[^c40], and the IBM Bob Premium Package for i, bringing AI-assisted development to IBM i applications — with early adopter Heartland Co-Op reporting 60 percent faster onboarding for new developers[^c41].
In June 2026, IBM and ServiceNow announced an expanded collaboration to address two of the biggest barriers to enterprise AI adoption: the AI-ready data problem and the legacy application layer[^c21]. The partnership delivers joint solutions across application modernization (using IBM Bob and watsonx.data), enterprise data governance (extending ServiceNow Workflow Data Fabric), and autonomous infrastructure operations (integrating Red Hat Ansible and HashiCorp tools into ServiceNow workflows). IBM also launched a new global Google Cloud Practice combining IBM Consulting Advantage with Google's Gemini Enterprise Agent Platform[^c19] and integrated watsonx.governance with Amazon SageMaker[^c20]. IBM joined the OpenAI Daybreak Cyber Partner Program in June 2026, launching a new AI-powered application security service that uses OpenAI's frontier models to identify and prioritize software vulnerabilities[^c31].
Also in June 2026, IBM announced three new IBM Z mainframe security tools: zSecure Detection for ransomware monitoring, zSecure Secret Manager for automated certificate lifecycle management, and the Z Database Assistant for agentic AI-driven database administration[^c24]. Between 2025 and 2026, Gartner named IBM a Leader in seven data and AI-related Magic Quadrant reports.
In May 2026, IBM announced plans to invest more than $10 billion in quantum computing over five years, targeting the world's first fault-tolerant quantum computer by 2029[^c8]. IBM committed $1 billion toward establishing Anderon, a dedicated quantum chip manufacturing facility in Albany, New York, with an additional $1 billion allocated through CHIPS Act federal funding[^c23]. IBM and Red Hat simultaneously launched Project Lightwell, a $5 billion initiative deploying 20,000 engineers to build an AI-driven enterprise security clearinghouse for open-source software vulnerabilities, with 11 major financial institutions as early adopters[^c22]. In July 2026, Lightwell was commercially launched through two offerings: Lightwell Network (6,500+ remediated dependencies) and Lightwell Clearinghouse Premier for financial services[^c30]. IBM also entered a major partnership with Nvidia for its Vera Rubin AI accelerator platform, announced at Computex Taipei in June 2026. On anticipation of the deal, IBM's stock surged to an all-time high — posting a 9.1 percent single-day gain and approximately 30 percent for the month of May 2026[^c9][^c12]. The company maintains a presence in 175 countries and serves 95 percent of Fortune 500 companies[^c11].
In April 2026, IBM and MIT launched the MIT-IBM Computing Research Lab, expanding their existing Watson AI Lab collaboration to include quantum computing alongside AI[^c32]. IBM and the University of Illinois Urbana-Champaign expanded their Discovery Accelerator Institute to deploy quantum-centric supercomputing by integrating NCSA supercomputers with IBM quantum systems. IBM also announced that Amaravati, India, will host one of the country's first IBM quantum computers, commissioned by September 2026[^c34]. In quantum research, IBM collaborated with the Cleveland Clinic and RIKEN to simulate protein complexes with up to 12,635 atoms on quantum hardware — the largest known biologically meaningful simulation performed on quantum systems to date[^c35].
On June 25, 2026, IBM announced the world's first sub-1-nanometer chip manufacturing technology, reaching a 0.7-nanometer node using a 3D vertical stacking "nanostack" architecture[^c27]. The technology can pack approximately 100 billion transistors on a fingernail-sized chip, doubling the density of IBM's 2021 2-nanometer nanosheet device, with production expected within five years through manufacturing partners[^c27].