By Seeking Alpha
Publication Date: 2026-09-26 00:00:00
IBM reported a modest 1% year-over-year revenue increase in Q2 despite a significant drop in IBM Z and transaction processing software sales. Operating earnings per share grew 5%, supported by expanded profit margins and maintained free cash flow guidance. Recurring software revenue accelerated to 8% growth, and the Distributed Infrastructure segment surged 37% with a record backlog. Early closure of delayed deals in Q3 suggests the revenue shortfall was due to timing, not lost demand. IBM trades at 18.44 times 2026 earnings with a 2.98% dividend yield, and the outlook remains positive as new offerings gain traction among major clients.
