By Elroy Fernandes
Publication Date: 2026-10-22 13:47:00
IBM topped Wall Street’s numbers across the board on October 21, then watched its shares give it all back once CEO Arvind Krishna told analysts that big corporate clients are starting to ask hard questions about whether their AI spending is actually paying off.
The numbers themselves were clean. IBM reported third-quarter revenue of $17.1 billion, up 5% from a year earlier, or 6% at constant currency, comfortably ahead of the roughly $16.82 billion Wall Street had modeled. Adjusted earnings came in at $2.95 a share against a consensus near $2.86. Software revenue climbed 8% to $7.8 billion, and infrastructure revenue rose 4% to $3.7 billion. On paper, this was IBM doing exactly what it has promised investors for two years: proving that its bet on hybrid cloud, Red Hat and generative AI consulting can still grow a 114-year-old company at a believable clip.
Shares popped briefly after the numbers landed, then reversed hard once the earnings call started. By the next session,…
