IBM shares plunge 25% after profit warning and revenue miss

IBM's stock fell more than 25% on Tuesday after the company warned of slower second-quarter revenue and said corporate spending had shifted away from its higher-margin software.

• IBM reported second-quarter revenue of $17.2bn, up just 1% year-over-year and below analyst estimates of $17.86bn.
• CEO Arvind Krishna said clients shifted spending toward servers and storage to secure supply-constrained infrastructure ahead of expected price increases.
• IBM said it had “faltered” in keeping pace with a move in corporate spending toward datacentre infrastructure and cybersecurity, and that “numerous large deals” failed to close.
• The profit warning triggered a broader selloff in software stocks, with Microsoft, ServiceNow, Salesforce, and Intuit falling between 3% and 5%.