This original tech bellwether is trouncing the market in 2025 – and pays a solid dividend
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jul 24 2025
0mins
Source: CNBC
IBM's Earnings Report: IBM experienced a significant drop in stock price after missing Wall Street's software revenue estimates, despite reporting solid overall earnings and raising its full-year cash flow guidance. The company remains a strong option for long-term investors due to its consistent dividend increases over the past 30 years.
Investment Strategies: Investors are encouraged to consider dividend reinvestment plans (DRIPs) to dollar-cost average into their positions, as well as exploring dividend-focused ETFs like Vanguard Dividend Appreciation ETF and ProShares S&P 500 Dividend Aristocrats ETF for diversified income opportunities.
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Analyst Views on IBM
Wall Street analysts forecast IBM stock price to rise
16 Analyst Rating
11 Buy
4 Hold
1 Sell
Moderate Buy
Current: 270.810
Low
210.00
Averages
315.80
High
375.00
Current: 270.810
Low
210.00
Averages
315.80
High
375.00
About IBM
International Business Machines Corporation is a provider of global hybrid cloud and artificial intelligence (AI) and consulting expertise. The Company’s segments include Software, Consulting, Infrastructure and Financing. The Software segment includes hybrid cloud and AI platforms, which allow clients to realize their digital and AI transformations across the applications, data, and environments in which they operate. The Consulting segment focuses on integrating skills on strategy, experience, technology and operations by domain and industry. The Infrastructure segment is focused on the hybrid cloud infrastructure market, providing on-premises and cloud-based server and storage solutions. In addition, it offers a portfolio of life-cycle services for hybrid cloud infrastructure deployment. The Financing segment provides client and commercial financing, facilitating its clients’ acquisition of hardware, software and services. It helps clients in more than 175 countries.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Tech Sovereignty Focus: The G7 summit and VivaTech conference in France highlight policymakers' and tech executives' concerns over American AI dominance, emphasizing the urgency for Europe to establish technological sovereignty, especially after the U.S. tightened export controls, revealing vulnerabilities in building domestic AI champions.
- AI Competition and Collaboration: The G7 meeting brings together top executives from leading AI companies like Anthropic, OpenAI, and Google to discuss AI competitiveness and reliance on China for critical minerals, reflecting Europe's strategic considerations in balancing cooperation and competition with U.S. tech giants.
- Policy Driving Local Industry: The French government is actively promoting tech sovereignty with plans to replace U.S. providers, as the Prime Minister stated, “France must have its own tools,” while the European Commission assesses the implications of U.S. export controls to ensure non-discriminatory practices towards partners.
- Cost and Risk Trade-offs: Despite billions in investment, European AI firms remain reliant on U.S. cloud infrastructure and AI models, with Capgemini's COO noting that boosting sovereignty could incur costs up to 40%, prompting companies to weigh risks against these expenses.
See More
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- Vendor Dependency: 71% of executives report that switching their primary AI vendor or model would be difficult, indicating a deepening reliance on AI systems that may reduce operational flexibility and impact business continuity.
- Data Sovereignty Challenges: 68% of surveyed executives find it challenging to meet data residency and sovereignty requirements, complicating the movement of AI systems or data across environments, which increases compliance risks and operational costs.
- Lack of Visibility: 91% of respondents indicate they do not fully understand their organization's dependencies on AI vendors, models, and infrastructure, limiting their ability to assess risks and respond to disruptions, potentially leading to severe business interruptions.
- Adaptability Gap: Only 7% of organizations possess advanced AI control capabilities that protect 55% of operating profit from AI-driven disruptions, highlighting a significant gap in building adaptable AI systems that could affect long-term competitiveness.
See More
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- AI-Driven Decision Support: By connecting financial, operational, and business data, Apptio's solutions enable companies to shift from reactive reporting to proactive, real-time monitoring of spending, assisting in managing the complexities of hybrid IT and enhancing competitive advantage.
- Market Demand Response: With global IT spending projected to reach $6.15 trillion by 2026, Apptio's updates aim to address financial blind spots faced by organizations amid rapid AI investments, ensuring transparency and effectiveness in technology investments.
See More
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- Technological Innovation: CEO Cristiano Amon revealed that the company is working on over 40 new AI device designs, expressing particular optimism about the growth potential of smart glasses, which could significantly enhance Qualcomm's market share in the rapidly evolving AI landscape.
- Market Reaction: Following the acquisition news, Qualcomm's stock rose approximately 4% in pre-market trading, indicating a positive investor response to the company's strategic shift and reflecting confidence in its future growth potential.
- Industry Trends: As AI applications continue to expand, Qualcomm's acquisition strategy aligns with industry trends and could provide long-term revenue growth opportunities, further solidifying its leadership position in the semiconductor sector.
See More
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- Muse Spark Model Launch: In April 2023, Meta launched the Muse Spark AI model, marking its first foray into proprietary foundation models; however, analysts emphasize that Meta needs to demonstrate the commercial viability of its AI tools to attract paying users and reduce reliance on its advertising business.
- Developer Trust Crisis: Following the failure of the Llama model, Meta's trust among AI developers has diminished, with industry experts suggesting that Wang's team must focus on internal applications rather than third-party developers to avoid further trust issues.
- Executive Pressure and Future Outlook: Despite positive internal feedback for Muse Spark, Wang and his team face high expectations from Zuckerberg to deliver more powerful AI models in the future, aiming to restore investor confidence and drive revenue growth.
See More
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- AI Strategy Overhaul: Mark Zuckerberg's investment of over $14.3 billion to bring in Alexandr Wang and his team aims to revamp Meta's AI strategy; however, despite the launch of the Muse Spark model in April, Meta remains behind OpenAI and Google in the AI market, indicating a competitive disadvantage.
- Developer Trust Crisis: Although the launch of Muse Spark marks Meta's first foray into proprietary foundation models, developer trust has waned, with many believing the company has failed to effectively engage external developers following the Llama model debacle, potentially impacting future product adoption.
- Revenue Growth Struggles: Despite reporting a 33% revenue growth in Q1, the fastest rate since 2021, Meta's stock has fallen 18% over the past 12 months, making it the worst performer among tech giants, reflecting market skepticism regarding the commercialization of its AI products.
- Internal Pressure Intensifies: With Meta laying off about 8,000 employees in 2023, morale is low, and the high expectations placed on Wang and his team create immense pressure on Meta to achieve sustainable growth in AI, especially after its virtual reality investments have led to over $80 billion in losses.
See More
