International Business Machines (IBM) has made a significant impact in the AI market by focusing on serving enterprise customers with complex needs. The company’s watsonx platform caters to businesses and organizations looking to develop and deploy AI applications while considering regulatory and legal compliance. IBM’s strategic approach has been successful, with its watsonx and Generative AI businesses exceeding one billion dollars and continuing to grow each quarter. Consulting services, rather than just software, are a major component of IBM’s AI business, positioning the company to provide not only a platform but also guidance and support for implementation.
One key strength of IBM’s business model is its agnostic approach towards other technology providers. This approach allows IBM’s consulting arm to collaborate with a network of strategic partners, generating billions of dollars in business that IBM may not have secured otherwise. At its annual THINK conference, IBM announced updates to its watsonx platform and partnerships with other technology companies. For example, IBM has made its advanced AI models open source for code generation, introduced new AI assistants, and formed partnerships with Amazon Web Services, Salesforce, and Microsoft to expand the reach of its watsonx platform.
By collaborating with various cloud platforms and technology providers, IBM is establishing itself as a leader in the enterprise AI market. This approach allows Watsonx to be deployed across different platforms, potentially leading to more business opportunities for IBM’s consulting arm. While AI adoption may take time to drive substantial growth for IBM, the company’s current valuation at around 13 times free cash flow guidance presents a promising investment opportunity.
In conclusion, International Business Machines is strategically positioning itself in the AI market by focusing on enterprise customers and forming partnerships with key technology companies. The company’s watsonx platform, coupled with its consulting services, is setting IBM apart as a leader in enterprise AI. With the potential for accelerated growth in the coming years, investing in IBM at this time could be advantageous for investors looking to capitalize on the evolving AI landscape.
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https://finance.yahoo.com/news/ibm-unleashes-flurry-ai-updates-102000413.html