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IBMIBM stock ticked higher late Wednesday despite the company lowering its growth outlook for the year. Expectations for IBM's second-quarter results were already lowered after the company released unofficial numbers last week, which missed Wall Street's forecasts and sent shares tumbling.
IBM reported adjusted earnings of $2.93 per share from sales of $17.2 billion for the June-ended quarter. The results were unchanged from IBM's preliminary release last week. Prior to IBM's unofficial results, analysts were expecting adjusted earnings of $3.01 per share and revenue of $17.9 billion, according to FactSet.
Second-quarter sales increased 1% year over year while adjusted earnings increased 5%.
Meanwhile, IBM said it expects revenue growth between 4% and 5% year over year in 2026. Its previous guidance was for growth above 5%. But the company stuck by its prior guidance for free cash flow to increase by "about $1 billion" year over year.
"Although we faced revenue headwinds late in the second quarter, we continued to focus on the fundamentals of our business, including driving productivity, strengthening our portfolio, and generating free cash flow," IBM Chief Financial Officer James Kavanaugh said in a news release.
IBM Stock Steadies
On the stock market today, IBM stock roses more than 1% to 208.67 in after-hours trading. Shares fell 2.3% during the regular session.
The surprise release of preliminary earnings last week sent shares of the 115-year-old tech giant down more than 25%.
In its pre-release, IBM blamed a shift in enterprise spending toward AI-related capital expenditures for its earnings and revenue miss. The shift slowed revenue for IBM's infrastructure division faster than the company had anticipated.
IBM is one of 30 component stocks in the Dow Jones Industrial Average.
Shares are down 30% year to date. Last week's slide helped wipe out a rally for IBM stock that started late in May, after news the company had won a $1 billion federal quantum computing award.
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