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INTERNATIONAL BUSINESS MACHINES CORP 8-K Report, Financial Results (Jul 14, 2026)

Reports
Earnings & Results·Regulation FD·Exhibits & Filings
Filing Date
Filed July 14, 2026
Period End
July 14, 2026
Security
IBM
In the record · 2016–202610-K1110-Q328-K210

IBM filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 210 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Oct ’17Oct ’17
  2. Leadership change8-K · Nov ’19Nov ’19
  3. Deal closed8-K · Nov ’21Nov ’21
  4. Material agreement8-K · Jun ’25Jun ’25

01—Abstract

Summary

Summary of the 8-K filed July 14, 2026. Cited figures are marked; the original filing is the authoritative source.

IBM's July 14, 2026 8-K furnishes a letter from CEO Arvind Krishna with preliminary, unaudited selected results for the second quarter of 2026.

Management cautions that the company is still closing its books and final results could differ slightly. Revenue was $17.2 billiona, up 1%, with Software up 5% and Consulting flat (up 1% at constant currency). Infrastructure fell 7%.

GAAP gross profit margin was 57.7%, down 100 basis points, and GAAP pre-tax income margin was 14.4%, down 90 basis points. Operating (non-GAAP) gross margin was 59.4%, down 70 basis points, and operating pre-tax margin was 19.2%, up 30 basis points. GAAP diluted EPS was $2.27b, down 2%, and operating EPS was $2.93, up about 5%.

Year-to-date net cash from operating activities was $7.8 billionc and free cash flow was $4.8 billion. The headline issue is the Infrastructure and Software shortfall. Management attributes it mainly to weaker z17 mainframe transaction-processing performance and a late-June shift in client capex toward servers, storage, and memory ahead of expected price increases.

Numerous large deals also failed to close on expected timelines, which management says drove most of the miss. Management acknowledges it 'did not adapt and move quickly enough.' Offsetting strengths included Red Hat growth accelerating to 11%, Distributed Infrastructure up 37% (its best reported performance) with about $500 milliond of backlog, z17 program-to-program tracking near 130%, and continued Consulting signings led by GenAI. The letter also highlights strategic investments: Lightwell, a $5 billion open-source vulnerability initiative that reached general availability on July 8, and a plan to invest more than $10 billion in quantum computing over five years, including the proposed Anderon quantum wafer foundry.

Management reaffirmed a 2029 target for a large-scale fault-tolerant quantum computer. The company will discuss full-year expectations on its July 22, 2026 earnings call at 5:00 p.m.

ET. The filing does not include updated full-year guidance.

02—Key points

Key Highlights

  1. Revenue of $17.2 billion, up 1%: Software up 5%, Consulting flat (up 1% at constant currency), and Infrastructure down 7%.
  2. GAAP gross margin of 57.7% (down 100 bps) and GAAP pre-tax margin of 14.4% (down 90 bps); operating (non-GAAP) pre-tax margin rose 30 bps to 19.2%.
  3. GAAP diluted EPS of $2.27 (down 2%) versus operating EPS of $2.93 (up about 5%); the gap reflects acquisition-related charges and retirement-related adjustments.
  4. Management blamed the shortfall on weaker z17/transaction-processing performance, late-quarter client capex shifts toward supply-constrained infrastructure, and slipped large deal closings.
  5. Bright spots include Red Hat growth accelerating to 11%, Distributed Infrastructure up 37% with about $500 million of backlog, and z17 program-to-program near 130%.
  6. Year-to-date operating cash flow of $7.8 billion and free cash flow of $4.8 billion, with the Financing receivables change of $2.3 billion excluded from the free cash flow calculation.
  7. Strategic investments include Lightwell ($5 billion, GA July 8, 2026), a planned $10 billion+ quantum investment over five years, and a 2029 fault-tolerant quantum target. Full-year outlook will be addressed on the July 22, 2026 call.

03—Questions

Frequently Asked Questions

  1. Are these Q2 2026 results final?

    No. The letter describes them as selected preliminary results. IBM says it is still working to close its financial reporting for the quarter, and the final results could be slightly different. The figures are unaudited.

  2. What caused the Infrastructure and Software shortfall?

    Management cited a z17 mainframe shortfall and associated software stack weakness, primarily in Transaction Processing. Clients also shifted late-June capex toward servers, storage, and memory to secure supply ahead of expected price increases, and cybersecurity concerns distracted clients. Management said numerous large deals failed to close on expected timelines, which drove most of the miss.

  3. How did profitability compare with last year?

    GAAP gross margin was 57.7% versus 58.8%, and GAAP pre-tax margin was 14.4% versus 15.3%. On an operating (non-GAAP) basis, gross margin was 59.4% versus 60.1%, while pre-tax margin rose to 19.2% from 18.8%, which management attributes to productivity initiatives. GAAP EPS was $2.27 versus $2.31, and operating EPS was $2.93 versus $2.80.

  4. Why do GAAP and operating EPS differ so much?

    The reconciliation adds back $0.58 per share of acquisition-related adjustments (such as intangible amortization, transaction costs, and restructuring) and $0.08 per share of retirement-related adjustments (non-service pension costs). IBM says these items can vary in size and timing with acquisition activity and pension market performance, so the company treats them as non-operating.

  5. Did IBM update its full-year outlook?

    The letter does not provide updated full-year guidance. Management said it will discuss full-year expectations on the Q2 earnings call scheduled for July 22, 2026, at 5:00 p.m. ET.

04—Continue

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