IBM jumps 9% on strong fourth-quarter results

IBM delivered robust fourth-quarter earnings on Wednesday, surpassing expectations and providing an optimistic outlook that edged past analyst forecasts. The tech giant saw revenue climb by 12% to reach $17.6 billion, up from $15.7 billion in the same period last year. Net income also saw a significant rise, reaching $5.6 billion, or $5.88 per share, compared to $2.92 billion, or $3.09 per share, in the previous year. Looking ahead, IBM anticipates full-year revenue growth to exceed 5%, although this marks a decline from last year's 8% growth rate. Analysts project a sales growth of 4.6% for 2026, according to LSEG forecasts. The company's free cash flow is expected to grow by an additional $1 billion, following its achievement of $14.7 billion in 2025. CEO Arvind Krishna expressed pride in the results, noting that IBM's generative artificial intelligence sector has surpassed $12.5 billion in revenue. "This capped a strong 2025 for IBM, where we exceeded expectations for revenue, profit, and free cash flow," Krishna stated. In detail, IBM's software revenue increased by 14%, hitting $9 billion for the fourth quarter, driven by successes in automation, data solutions, and Red Hat products. Additionally, infrastructure sales surged by 21% to $5.1 billion, buoyed by a remarkable 67% year-over-year growth in its IBM Z Systems line of mainframe computers. In a show of confidence, the company's board also approved a dividend of $1.68 per share, set to be distributed on March 10.