IBM Q2 FY2026: revenue edges up 1.1%, EPS falls short, Infrastructure drags
IBM's second quarter was a growth story in software and a drag everywhere else. Revenue rose just 1.1% to $17.162 billion, gross margin fell to 57.7%, and non-GAAP EPS of $2.93 missed the $2.9984 consensus. The read: software (up 5.1%) and Distributed Infrastructure (up 37.0%) are working, but Infrastructure fell 7.4% on a 42.0% drop in IBM Z. Guidance was reaffirmed in direction, not in numbers.
1 · Expected vs. Actual
Free preview belowGAAP diluted EPS was $2.27, down from $2.31 a year ago, while non-GAAP EPS of $2.93 missed the $2.9984 consensus. Gross margin slipped to 57.7% from 58.8%, and the gap between GAAP and non-GAAP is largely $0.58 per share of acquisition-related charges. Earnings are drifting rather than breaking, but the direction is not up.
Revenue came in at $17.162 billion, up 1.1% from $16.977 billion a year earlier. Software grew 5.1% to $7.761 billion and Consulting was flat at $5.327 billion, but Infrastructure fell 7.4% to $3.835 billion, with IBM Z down 42.0%. The mix is improving while the total barely moves.
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Figures on this page come from the company's original SEC filings. The analysis is generated automatically and checked against validation rules, but may still contain errors or omissions. Not investment advice. · Generated 2026-09-17
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