Updated Sunday 25 October 2026. IBM (NYSE: IBM) closed Friday 23 October at $253.56, up $1.45 or 0.58 percent, and was $253.00 after hours (StockAnalysis). The stock is 9.2 percent higher than a week ago and above the $251.46 it closed at on 21 October, the day it reported, even though it fell 5.11 percent after hours that night to $238.60 and opened the next session at $241.25 (Investing.com, StockAnalysis). The third quarter beat on every headline line: revenue $17.1 billion against $16.82 billion expected, operating EPS $2.95 against $2.86, software up 9 percent at constant currency, free cash flow $3.0 billion and the full-year free cash flow outlook raised to more than $1 billion of growth. What sold the stock was a revenue guide held at 4-5 percent, a quarter of the software growth coming from deals that slipped out of Q2, and chief executive Arvind Krishna saying large enterprises are asking "what is the true ROI of all of their AI spend". Verdict: a $253.56 close is just above the $250.45 200-day average and within 1.5 percent of the $257.22 consensus target, so this week the shares trade on the Fed and on what Microsoft, Alphabet and Amazon say about enterprise AI budgets rather than on IBM's own numbers. Reference levels: $240 below, $269 above.
Key facts
- Friday 23 October close: $253.56, up $1.45 or 0.58 percent, range $247.03-$254.71, volume 5.89 million, after hours $253.00. Market cap $239.6 billion, 52-week range $199.19-$332.46, 50-day average $233.04, 200-day average $250.45, trailing P/E 21.6, forward P/E 19.4, dividend $6.76 a year for a 2.67 percent yield, next ex-dividend date 10 November (StockAnalysis).
- The week's path: $232.14 on 16 October; $241.92 on 20 October; $251.46 on 21 October, up 3.94 percent into the print; after hours $238.60, down 5.11 percent; 22 October opened $241.25, low $240.00, high $256.30, closed $252.11, up 0.26 percent on 11.5 million shares; 23 October $253.56 (StockAnalysis, Investing.com).
- Q3 2026 headline numbers: revenue $17.1 billion, up 5 percent as reported and 6 percent at constant currency; GAAP EPS $2.31, operating EPS $2.95, up 11 percent; GAAP gross margin 56.8 percent, operating gross margin 58.5 percent; adjusted EBITDA $4.9 billion, up 7 percent; free cash flow $3.0 billion in the quarter, up $0.7 billion, and $7.8 billion year to date, up 8 percent; cash $11.1 billion, debt $63.8 billion including $12.7 billion of financing debt (IBM 8-K, Investing.com).
- Software, $7.8 billion, up 8 percent (9 percent constant currency): Hybrid Cloud and Red Hat up 11 percent, Data up 19 percent (20 percent constant currency), transaction processing up 10 percent, Automation down 3 percent; software ARR $24.9 billion, up 8 percent; OpenShift ARR up more than 30 percent; segment margin up 210 basis points. Confluent bookings grew about 20 percent and HashiCorp grew bookings in every geography (IBM 8-K, Investing.com, earnings call via Motley Fool).
- Consulting, $5.3 billion, flat (2 percent constant currency): Strategy and Technology up 4 percent, Intelligent Operations flat; segment margin 12.2 percent, down 60 basis points; signings about $5 billion, down 2 percent, quarterly book-to-bill about 0.94 and trailing twelve months 1.04. AI was about 30 percent of consulting revenue in the quarter and 35 percent of backlog (CFO James Kavanaugh).
- Infrastructure, $3.7 billion, up 4 percent (5 percent constant currency): Distributed Infrastructure up 32 percent, Hybrid Infrastructure up 9 percent, IBM Z down 19 percent as the z17 cycle matures, Infrastructure Support down 2 percent; segment margin up 120 basis points (Investing.com).
- Guidance: full-year revenue growth held at 4-5 percent constant currency with currency now neutral; free cash flow growth raised to more than $1 billion year over year; operating pre-tax margin expansion of 100 basis points reiterated; software growth 7-8 percent for the year with about 7 percent the base case, up from 6-8 percent; transaction processing flat for the year with a moderation from Q3 into Q4; consulting a "modest acceleration to low to mid-single digit revenue growth for the year" (IBM 8-K, earnings call).
- The caveats the market priced: Kavanaugh said about a quarter of the software growth came from the roughly $400 million of deals that slipped out of Q2, about two-thirds of which closed; BofA estimated the catch-up at about $250 million; UBS estimates organic software growth at about 1 percent once the catch-up and acquisitions are excluded, and calculates that the 100 basis point margin target implies about 180 basis points of Q4 expansion. Krishna said some enterprises are "getting worried if some of the AI spending completely out of control with no real return" and declined to discuss 2027: "Right now, we do not really want to comment on 2027 growth" (Investing.com, earnings call).
- Targets after the print, 22 October: Goldman Sachs (James Schneider) Buy, $270 to $300; Jefferies Buy, $270 to $280; RBC (Matthew Swanson) Buy, $270; JPMorgan Overweight, $250 to $269; BMO (Keith Bachman) Hold, $230 to $265; Truist (Arvind Ramnani) Hold, $240 to $260; Stifel (David Grossman) Buy, $235 to $260; Baird Neutral, $260; Susquehanna Neutral, $235 to $256; UBS Neutral, $236 to $243. Morgan Stanley went to $238 Equal-weight on 15 October, before the print (StockAnalysis, GuruFocus, MarketBeat, ad-hoc-news).
- Consensus: 25 analysts at StockAnalysis rate the stock Buy, with 9 Strong Buy, 3 Buy, 11 Hold, 1 Sell and 1 Strong Sell; average target $257.22, median $260, high $300, low $174. 2026 consensus is $70.56 billion of revenue and $12.42 of EPS; 2027 $73.22 billion and $13.24 (StockAnalysis).
The sell-off that lasted one session
The after-hours tape on 21 October looked like a verdict: down 5.11 percent to $238.60 on a beat. By 12:45 pm ET the next day the stock was $248.72 and by the close it was $252.11, 65 cents above where it had been before anyone saw the numbers, on the heaviest volume of the week. Friday added another 0.58 percent. So the week's story is not a sell-off but a repricing of what the beat was worth: enough to hold the $251 pre-print level, not enough to extend a run that had already taken the shares from $232.14 to $251.46 in the three sessions before the report. That matters for how to read the week ahead, because the stock now sits almost exactly on its 200-day average of $250.45 and within 1.5 percent of the Street's average target, with the 50-day at $233.04 well below. The easy move, the one from oversold to fair, is done.
What the software number is worth
Nine percent constant-currency software growth is the best print IBM has shown since the Q2 stumble, and the company raised the low end of its full-year software guide to 7 percent from 6 percent on the back of it. The debate is how much of it repeats. Kavanaugh's own split is that about three-quarters was net new business and a quarter was the Q2 slip deals; BofA puts the slip-deal catch-up at about $250 million, and UBS strips out both the catch-up and the acquired revenue from Confluent and HashiCorp to arrive at organic growth of about 1 percent. Transaction processing, the mainframe software line, grew 10 percent on z17 demand and Krishna himself expects "a moderation from 3Q going into the fourth quarter", with the line flat for the full year. Red Hat at 11 percent and Data at 20 percent are the parts that need no asterisk, and OpenShift ARR growing more than 30 percent is the number the bulls will quote. UBS adds the 2027 problem: Confluent's contribution laps in March 2027, after which software growth could fall below the roughly 7.5 percent the Street has pencilled in, and management has said only that it will quantify 2027 in January.
Consulting and the AI question
Consulting was flat as reported, up 2 percent in constant currency, with margin down 60 basis points to 12.2 percent and a quarterly book-to-bill below 1. AI is now 30 percent of consulting revenue and 35 percent of backlog, which is the point: IBM's consulting arm is the part of the company most exposed to the budgets Krishna described when Jefferies' Brent Thill asked about demand. His answer, that the largest enterprises are focused on "what is the true ROI of all of their AI spend" and that some worry spending is "completely out of control with no real return", is the same message that has weighed on Palantir since Gartner's forward-deployed-AI warning. It is also why this week's calendar matters more to IBM than usual: Microsoft and Alphabet report after Wednesday's close and Amazon after Thursday's, and their cloud growth and capex lines are the clearest read the market gets on whether enterprise AI budgets are being cut or merely scrutinised. Our Amazon page sets out what AWS needs to show.
IBM stock this week: bull, base and bear
| Scenario | Level | What has to happen | Anchor |
|---|---|---|---|
| Bear | $240 | Microsoft, Alphabet or Amazon flag slower enterprise AI spending or guide capex in a way that reprices the whole group, a hawkish Warsh press conference lifts the 10-year back toward 5 percent, and the shares give back the post-results recovery. | The $240.00 intraday low of 22 October, the session the after-hours drop was bought; also just below UBS's $243 Neutral target. About 5.3 percent below Friday's close and below the 200-day average. |
| Base | $248-$258 | The megacap prints confirm cloud demand without changing the AI-budget debate, the Fed holds as priced, and IBM trades around its 200-day average and the consensus target while the software-sustainability argument is unresolved. | Friday's $253.56 plus or minus about 2 percent, bracketing the $250.45 200-day average and the $257.22 average target (StockAnalysis). |
| Bull | $269 | Azure, Google Cloud and AWS growth re-accelerate and capex guides are taken as demand rather than excess, the 10-year eases after the Fed, and the Buy-rated houses' targets pull the stock through the median $260. | JPMorgan's $269 Overweight target, just under RBC's $270 and Goldman's path to $300; about 6.1 percent above Friday's close. |
The bear case sits below Friday's price. These are reference levels measured from the verified quotes and published targets, not forecasts.
What to watch this week
- Wednesday 2 pm ET: the Fed. CME FedWatch prices a hold at 91-92 percent and a hike at 8-9 percent after September's increase; Chair Kevin Warsh's press conference and the December language move a 2.67 percent-yielding stock with a 0.72 beta more than most.
- Wednesday after the close: Microsoft and Alphabet. Azure and Google Cloud growth, capex guides and any comment on enterprise AI budgets are the read-across to IBM's consulting backlog and Red Hat.
- Thursday after the close: Amazon, with AWS the third cloud read; the same day brings Q3 GDP and September PCE.
- $250.45 and $257.22: the 200-day average and the consensus target; the stock closed between them on Friday.
- Further out: ex-dividend 10 November for the $1.69 quarterly payment; Q4 and full-year results tentatively 27 January 2027, when management has said it will quantify 2027, against a consensus of $4.62 EPS on $20.47 billion of revenue (Investing.com).
Quick take: IBM goes into Fed week at $253.56, up 9.2 percent in five sessions, after a Q3 beat whose after-hours sell-off was fully bought back within a day. The shares sit on the 200-day average and within 1.5 percent of the Street's target, so the next move comes from Microsoft, Alphabet and Amazon's read on enterprise AI budgets and from Wednesday's Fed. Strong cloud prints and a calm Warsh open $269; an AI-budget warning or a hawkish Fed opens $240.
FAQ
What is the IBM stock price today?
IBM closed at $253.56 on Friday 23 October 2026, up 0.58 percent, and was $253.00 after hours (StockAnalysis). Markets are closed on Sunday 25 October.
Did IBM beat earnings in Q3 2026?
Yes. Revenue was $17.1 billion against $16.82 billion expected and operating EPS $2.95 against $2.86. Software grew 9 percent at constant currency, free cash flow was $3.0 billion and the full-year free cash flow outlook was raised (IBM 8-K, Investing.com).
Why did IBM stock fall after earnings?
The shares fell 5.11 percent after hours on 21 October because the full-year revenue guide was held at 4-5 percent, about a quarter of the software growth came from deals delayed out of Q2, and Krishna described enterprises scrutinising the return on AI spending. The drop was bought the next day and the stock closed higher than before the report (Investing.com, StockAnalysis).
What are analysts' price targets for IBM?
The StockAnalysis average is $257.22 across 25 analysts, median $260, with a $174-$300 range. After the print Goldman Sachs went to $300, Jefferies $280, RBC $270, JPMorgan $269, BMO $265, Truist, Stifel and Baird $260, Susquehanna $256 and UBS $243.
Is IBM's software growth sustainable?
Management guides 7-8 percent for the year. About a quarter of Q3's growth came from slipped Q2 deals, UBS estimates organic growth near 1 percent excluding that and acquisitions, and transaction processing is expected to moderate in Q4. Red Hat at 11 percent and Data at 20 percent are the organic drivers (earnings call, Investing.com).
What is IBM's dividend and when is the next ex-dividend date?
$6.76 a year, or $1.69 a quarter, for a 2.67 percent yield at Friday's close. The next ex-dividend date shown is 10 November 2026 (StockAnalysis).
When does IBM report next?
Q4 and full-year 2026 results are tentatively scheduled for 27 January 2027, when management has said it will quantify its 2027 outlook. Consensus is $4.62 of EPS on $20.47 billion of revenue (Investing.com).
Sources: StockAnalysis (closing, after-hours and daily history prices 16-23 October 2026, statistics, analyst consensus and target changes); IBM Form 8-K exhibit 99.1 (Q3 2026 results and outlook, 21 October); Investing.com (Q3 slides summary and after-hours move, 21 October; earnings analysis by Luke Juricic with UBS, BofA, Bernstein and consensus figures, 22 October); Motley Fool (Q3 2026 earnings call transcript: Krishna and Kavanaugh quotes); GuruFocus, MarketBeat and ad-hoc-news (Stifel, Baird, Susquehanna, JPMorgan, Jefferies and Morgan Stanley target changes, 15-22 October); CME FedWatch and Reuters poll (Fed probabilities, 24-25 October); Seeking Alpha, TradingKey and FXEmpire (week-ahead calendar: Fed, Microsoft, Alphabet, Amazon, GDP, PCE).
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Stocks are volatile and you can lose money. Do your own research and consult a licensed financial adviser before making investment decisions.
