Read IBM CEO's letter to investors warning about its poor results: 'This quarter we faltered'

Shares of IBM took a dive on Tuesday following the release of preliminary earnings for the second quarter, which fell short of Wall Street's projections. The tech giant reported a modest revenue increase of $17.2 billion, representing only a 1% rise compared to the previous year, yet it was below the expectations set by analysts. Notably, the infrastructure segment experienced a significant decline, dropping by 7%. In a candid letter to investors, CEO Arvind Krishna acknowledged the company's struggles, stating that IBM had 'faltered' this quarter. He attributed the disappointing results to several large deals that did not materialize as expected and noted that clients were pivoting their spending towards servers, storage, and memory in anticipation of rising prices due to a global memory shortage. Krishna further elaborated that the company underestimated the extent to which clients would alter their spending patterns and admitted that IBM did not respond swiftly enough to these changes. The full letter from Krishna provides more insight into the company's current challenges and future outlook.