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Here’s how the company did in comparison with LSEG consensus:
- Earnings per share: $1.91 adjusted vs. $1.81 expected
- Revenue: $15.92 billion vs. $15.62 billion expected
IBM’s revenue grew 9% year over year in the quarter, according to a statement. Net income of $1.22 billion, or $1.28 per share, increased from $1.06 billion, or $1.12 per share, in the fourth quarter of 2024. Adjusted earnings exclude acquisition-related adjustments.
Management reiterated its view for 2026, including over 5% revenue growth at constant currency and a $1 billion increase to free cash flow.
IBM’s first-quarter software revenue grew 11% to $7.05 billion, higher than the $7.02 billion consensus among analysts polled by StreetAccount. Revenue from consulting, at $5.27 billion, was up 4%, coming in just shy of StreetAccount’s $5.28 billion consensus.
Infrastructure increased 15% to $3.33 billion, above the $3.16 billion StreetAccount consensus. IBM pointed to a 51% jump in Z mainframe hardware revenue.
As of Wednesday’s close, IBM shares had declined about 15% so far in 2026, while the S&P 500 index was up 4% in the same period.
The stock dropped 13% in a single day in February after artificial intelligence model builder Anthropic said AI could assist companies with modernizing code written in the COBOL programming language. Applications written in COBOL can run on IBM’s mainframe computers. “AI strengthens the mainframe case, it does not weaken it,” IBM’s senior vice president of software, Rob Thomas, wrote in a LinkedIn post.
In mid-March, IBM completed the $11 billion acquisition of data streaming software company Confluent.
Executives will discuss the results with analysts on a conference call starting at 5 p.m. ET.
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