International Business Machines' (IBM) investors woke up to a nasty surprise on July 14. The technology giant released preliminary second-quarter results a week ahead of schedule, and the market's reaction was brutal. IBM shares plunged more than 25% and suffered their worst day since 1987 after the company reported missed expectations on both revenue and earnings while admitting it had failed to keep pace with changing customer spending patterns.
CEO Arvind Krishna acknowledged that IBM "faltered" as customers shifted more of their technology budgets toward AI servers, storage, and memory chips rather than traditional software and infrastructure projects.
