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IBM craters 23% on second-quarter earnings warning as clients shift spend to hardware

7/20/2026

A second-quarter earnings warning from International Business Machines (NYSE: IBM) has sent shares 23% lower in the session.

The company's chief executive officer placed the blame on weakness in software and infrastructure, pointing to a concrete cause: clients redirected their spending toward hardware purchases.

The formal second-quarter earnings release is the next item in focus. The CEO's read on the miss The CEO's explanation is a spending rotation story.

Budgets that once went to software and infrastructure moved into hardware.

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