IBM : Text of the report on the company (16951f1374617f4e)

Published: 2026-05-01 16:45:12 ET IBM

Published on 05/01/2026 at 04:45 pm EDT

Hello everyone.

Thank you for joining us today.

2025 was the year AI moved from experimentation to execution. Business leaders stopped asking what AI could do and started asking what it would deliver. IBM answered by deploying enterprise AI that improves the economics of real work across thousands of clients worldwide. And we applied those same capabilities inside our own company.

As a result, I'm pleased to report that IBM is delivering strong results for clients, employees, and shareholders.

Today, I want to speak with you about three things:

First, our financial performance in 2025

Second, how we're executing our strategy around AI and hybrid cloud

And third, what we're building for the future-including quantum computing

Let's start with the numbers.

In 2025, IBM generated $67.5 billion in revenue, up 6% at constant currency. We delivered

$14.7 billion in free cash flow-our highest in over a decade. And our generative AI book of business grew to over $12.5 billion since inception.

Software led the way with 9% revenue growth at constant currency-our highest annual growth rate in history. Three of our four Software subsegments delivered double-digit growth.

Software now represents approximately 45% of IBM's total revenue.

Consulting revenue was flat at constant currency. Demand remained consistent across AI-enabled workflow transformation and cloud modernization. And we are actively shifting the business toward higher-value, AI-augmented delivery that improves margins over time.

Infrastructure revenue grew 10% at constant currency, driven by the strength of mission-critical platforms like our new z17 mainframe.

We expanded operating pre-tax income margin by 100 basis points, driven by our continued shift to higher-value offerings and a sustained focus on productivity. Since the beginning of 2023, we delivered approximately $4.5 billion in productivity savings.

These results enabled us to invest significantly in the business while returning value to you, our shareholders. We returned $6.3 billion through dividends. I'm pleased to announce that we are increasing the quarterly dividend to $1.69 per share. We have now raised it for 30 consecutive years. We closed several acquisitions, including HashiCorp. And we invested over $8.3 billion in research and development to fuel continued innovation.

Let me turn to our strategy.

IBM is a software-led company built on four core platforms: hybrid cloud, AI, infrastructure with IBM Z, and an emerging one around quantum computing.

The power of this strategy lies in integration. IBM is uniquely positioned to help clients build, deploy, and manage enterprise AI on hybrid cloud and provide business solutions across software, consulting, and infrastructure. Today, more than 80% of our revenue comes from clients who transact across all three business segments. Revenue in one area pulls through revenue in others.

Clients today aren't just adding AI-they're becoming AI-first. They need enterprise-grade solutions they can control, govern, and scale. That's what IBM delivers.

At the center of our software portfolio is watsonx, our enterprise AI platform. In 2025, we expanded watsonx Orchestrate with pre-built domain agents for HR, sales, and procurement, and we introduced a catalog of more than 150 agents and tools in collaboration with our partners. We released Granite 4.0, our next-generation family of efficient, open language models, which can reduce memory use by 70% compared to typical large language models while maintaining competitive performance.

We also introduced IBM Bob, our new agentic development environment, which selects the best model for each task. IBM developers using Bob have already reported average productivity gains of 45%.

Hybrid cloud remains essential-because AI is only as valuable as the data behind it. We continue to see strong demand for Red Hat OpenShift and Ansible. In 2025, we launched Red Hat Enterprise Linux 10 with container-native capabilities. Our acquisition of HashiCorp added automation and FinOps capabilities valued by developers. In 2025, we announced an agreement to acquire Confluent, a leader in real-time data streaming, which we recently closed.

On the infrastructure side, IBM z17 is our first mainframe fully engineered for AI-enabling hundreds of AI use cases and bringing intelligence directly into the flow of real-time operations like fraud detection and payments.

We focus on industries where trust, security, data sovereignty, and complex workflows define success. We do not compete in mass consumer AI. That is a deliberate choice-and it's one that sets IBM apart.

Consulting plays a critical role in converting all of this technology into business outcomes. More than 150,000 IBM consultants worldwide are equipped with IBM Consulting Advantage, our AI-powered delivery platform, to help clients move from AI pilots to production at scale.

We apply this same discipline internally. Our Client Zero approach means we deploy our own technology first, then scale it for clients - and AI-driven automation has already produced meaningful productivity gains across HR, finance, and IT.

No single company can deliver transformation alone. That's why we also continue to expand our partner ecosystem-working with AWS, Microsoft, SAP, Salesforce, Oracle, and others to extend our reach and serve clients better.

Quantum is the first genuinely new computing paradigm in 80 years. It is not an iteration on what came before, but a fundamental departure. And it has crossed a critical threshold: it is no longer a scientific problem. It is an engineering problem. When something makes that transition, the question shifts from whether to when and how fast.

We believe quantum technology today is comparable to where GPUs were in 2015: early, imperfect, but potentially transformative. IBM is building the hardware, software, and ecosystem to make quantum computing a practical reality.

We have deployed more than 85 quantum systems for use by a global ecosystem of more than 300 organizations. In 2025, we deployed our most advanced systems-IBM Quantum System Two-in Japan and Spain. We unveiled a path to build the world's first large-scale, fault-tolerant quantum computer, IBM Quantum Starling, at our Quantum Data Center in Poughkeepsie, New York, by 2029.

Early signals of commercial promise are already emerging. HSBC has demonstrated improved algorithmic bond trading accuracy by 34% using IBM quantum systems. Moderna is using quantum optimization in drug design research, modeling the longest mRNA protein fold ever achieved. The potential applications ahead-from energy-efficient fertilizers to advanced batteries-are significant.

Let me close with this.

The most successful businesses convert new technology into operating leverage. That was true of the internet. It was true of hybrid cloud. And it is true of AI.

AI is redefining business economics-making possible what was previously too complex, too slow, or too costly. Enterprises that integrate AI into real workflows, at scale, and with clear economic returns, are the ones that will lead. That is what IBM is building - a business whose value grows as AI scales. For our clients, that means measurable outcomes. For our employees, that means greater productivity and the ability to deliver more value to the clients they serve. For our shareholders, it means a company structurally positioned to lead the next decade of enterprise technology.

Thank you for your support, your confidence, and your partnership in this journey.

Forward-Looking and Cautionary Statements

Certain statements contained in this presentation may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-looking statement in this presentation speaks only as of the date on which it is made; the company assumes no obligation to update or revise any such statements except as required by law. Forward-looking statements are based on the company's current assumptions regarding future business and financial performance; these statements, by their nature, address matters that are uncertain to different degrees. Forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to be materially different, as discussed more fully elsewhere in this Annual Report and in the company's filings with the Securities and Exchange Commission (SEC), including the company's 2025 Form 10-K filed on February 24, 2026.

In an effort to provide additional and useful information regarding the company's financial results and other financial information, as determined by generally accepted accounting principles (GAAP), these materials contain certain non-GAAP financial measures on a continuing operations basis, including revenue growth rates adjusted for constant currency. Free cash flow is presented on a consolidated basis, which includes activity from discontinued operations. The rationale for management's use of this non-GAAP information is included on page 7 and 31 of the company's 2025 Annual Report, which is Exhibit 13 to the Form 10-K submitted with the SEC on February 24, 2026. For reconciliation of these non-GAAP financial measures to GAAP and other information, please refer

to pages 27 and 32 of the company's 2025 Annual Report.

Disclaimer

IBM - International Business Machines Corporation published this content on May 01, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 01, 2026 at 20:44 UTC.