IBM is the latest AI casualty. Shares are tanking 11% on Anthropic programming language threat

Shares of International Business Machines (IBM) have experienced a sharp decline, falling by 11% during Monday's trading session. This downturn comes as a result of emerging AI technologies, particularly following Anthropic's announcement regarding its Claude Code product, which now offers capabilities for automating the intricate processes involved in COBOL modernization. COBOL, an acronym for Common Business-Oriented Language, has been a fundamental programming language since the 1950s, especially in business data processing. It continues to support critical systems that manage vast numbers of transactions, including those in payment processing and retail. Anthropic highlighted in a blog post that COBOL accounts for approximately 95% of ATM transactions across the United States, underscoring its ongoing significance in the financial sector. In its update, Anthropic noted, "Hundreds of billions of lines of COBOL operate daily in production, underlining the importance of this legacy code. However, the number of individuals skilled in COBOL is diminishing each year." The company pointed out that modernization efforts have stagnated for years, primarily due to the high costs associated with understanding legacy code versus rewriting it entirely. However, they argue that AI technology can reverse this trend. Claude Code is positioned to aid in COBOL modernization by mapping dependencies throughout extensive codebases, documenting workflows, and identifying risks that traditionally would take human analysts a considerable amount of time to uncover. This innovation has sparked concerns among investors, leading to a jittery market environment where stocks, including IBM's, have seen significant volatility. The impact of AI advancements was also felt across the cybersecurity sector. Following Anthropic's introduction of Claude Code Security—a feature designed to scan codebases for security vulnerabilities—several cybersecurity stocks faced declines as well. As the market reacts to these developments, IBM's shares have now plummeted nearly 22% year-to-date, highlighting the growing apprehension surrounding the future of legacy systems in an increasingly AI-driven world.