IBM Shares Drop 11% Amid AI Disruption from Anthropic's Claude
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 23 2026
0mins
Should l Buy IBM?
Source: CNBC
- Significant Stock Decline: IBM shares plummeted 11% in Monday afternoon trading, reflecting market concerns over the rapid development of AI technology, particularly after Anthropic introduced COBOL automation capabilities with Claude, severely impacting investor sentiment.
- COBOL Modernization Threat: As a programming language widely used in business data processing, COBOL handles 95% of ATM transactions in the U.S., and Anthropic's Claude Code can automate the complex tasks involved in COBOL modernization, posing a direct threat to IBM's core business.
- AI Disrupting Tradition: Anthropic highlighted that AI can significantly reduce the costs associated with modernizing legacy code, transforming a process that previously required months of human analysis into a rapid task achievable through Claude Code, thereby altering traditional modernization workflows.
- Market Turbulence: With the swift advancement of AI technology, IBM has become the latest stock to be impacted, with shares down nearly 22% year-to-date, indicating heightened investor sensitivity to AI-related risks.
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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: 239.370
Low
210.00
Averages
315.80
High
375.00
Current: 239.370
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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- Support for Anthropic: Hundreds of tech workers signed another letter urging the Department of Defense to withdraw its 'supply chain risk' designation against Anthropic, emphasizing that American tech companies should not face retaliation for refusing government demands, reflecting strong opposition to governmental overreach.
- Google's Military Negotiations: Google is reportedly in talks with the Pentagon to deploy its AI model Gemini onto classified systems, raising employee concerns about the company's military collaborations, especially following past internal protests against similar projects, highlighting a growing demand for transparency.
- Historical Lessons and Principles: Google faced significant employee protests in 2018 over Project Maven, leading to the non-renewal of the contract and the establishment of 'AI Principles'; however, recent negotiations have raised questions about the relevance of these principles, particularly concerning human rights and ethical usage.
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- Pentagon Blacklist Impact: Following U.S. military actions in Iran, the Defense Department blacklisted Anthropic as a 'supply chain risk,' prompting more tech workers to sign petitions urging Congress to review the appropriateness of such extreme measures against American tech firms.
- Google-Pentagon Negotiations: Google is reportedly in talks with the Pentagon to deploy its AI model Gemini onto classified systems, reviving internal debates over military AI, as employees express concerns and demand the establishment of red lines similar to those set by Anthropic.
- Historical Lessons and Principles: Google faced significant employee backlash in 2018 over its involvement in a Pentagon drone project, leading to a lapse in the contract and the establishment of 'AI Principles,' yet controversies resurfaced in 2024 over a contract with the Israeli government, highlighting the ethical dilemmas in military collaborations.
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- Unemployment Rate Warning: Citrini Research's report warns that AI could push unemployment above 10% by 2028, leading to a decline in economic demand as companies cut jobs, which could further pressure profits and exacerbate layoffs, creating a negative feedback loop.
- Market Reaction: The report spooked markets, causing the S&P 500 index to fall by 1% on the day of its release, reflecting investor anxiety over the potential economic crisis stemming from AI, indicating high uncertainty about future economic conditions.
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See More
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- IBM Stock Plunge: The announcement by AI startup Anthropic PBC regarding its Claude Code tool modernizing COBOL led to IBM's shares dropping 13% on February 23, marking its worst single-day loss since 2000, highlighting market sensitivity to AI impacts.
- Economic Feedback Loop: The report indicates that improved AI capabilities lead to layoffs, which reduce consumer spending, forcing companies to invest more in AI to protect margins, creating a negative feedback loop that could result in 'Ghost GDP', where economic growth does not translate into real consumption.
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See More
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- Employee Solidarity: Nearly 900 tech workers from Google and OpenAI signed an open letter demanding clear limits on military collaboration in response to U.S. strikes on Iran and sanctions against Anthropic, indicating rising discontent within the industry regarding government military partnerships.
- Support for Anthropic: Hundreds of tech workers signed another letter urging the Department of Defense to withdraw its 'supply chain risk' designation against Anthropic, emphasizing that American tech companies should not face retaliation for refusing government demands, reflecting strong opposition to governmental overreach.
- Google's Military Negotiations: Google is reportedly in talks with the Pentagon to deploy its AI model Gemini onto classified systems, raising employee concerns about the company's military collaborations, especially following past internal protests against similar projects, highlighting a growing demand for transparency.
- Historical Lessons and Principles: Google faced significant employee protests in 2018 over Project Maven, leading to the non-renewal of the contract and the establishment of 'AI Principles'; however, recent negotiations have raised questions about the relevance of these principles, particularly concerning human rights and ethical usage.
See More
Tech Workers Demand Limits on Military AI Use
- Employee Coalition: Workers at Google and OpenAI are rallying around an open letter titled 'We Will Not Be Divided,' which has seen signatories grow from a few hundred to nearly 900 in just a few days, reflecting strong opposition to their companies' military collaborations.
- Pentagon Blacklist Impact: Following U.S. military actions in Iran, the Defense Department blacklisted Anthropic as a 'supply chain risk,' prompting more tech workers to sign petitions urging Congress to review the appropriateness of such extreme measures against American tech firms.
- Google-Pentagon Negotiations: Google is reportedly in talks with the Pentagon to deploy its AI model Gemini onto classified systems, reviving internal debates over military AI, as employees express concerns and demand the establishment of red lines similar to those set by Anthropic.
- Historical Lessons and Principles: Google faced significant employee backlash in 2018 over its involvement in a Pentagon drone project, leading to a lapse in the contract and the establishment of 'AI Principles,' yet controversies resurfaced in 2024 over a contract with the Israeli government, highlighting the ethical dilemmas in military collaborations.
See More
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- Flex LNG Options Volume: Flex LNG Ltd's options volume reached 2,649 contracts today, representing approximately 264,900 shares, which is about 49.9% of its average daily trading volume of 531,070 shares over the past month, indicating significant market interest in the stock.
- High Put Option Activity: Within Flex LNG, the $25 strike put option saw 849 contracts traded today, equating to approximately 84,900 shares, suggesting investor expectations of potential price declines, which could impact the company's stock price trajectory.
- Moderna Options Volume: Moderna Inc's options volume totaled 50,944 contracts today, representing around 5.1 million shares, or about 49.1% of its average daily trading volume of 10.4 million shares over the past month, reflecting strong market interest in its stock.
- High Call Option Activity: For Moderna, the $57 strike call option recorded 6,594 contracts traded today, amounting to approximately 659,400 shares, indicating investor optimism regarding future price increases, which may drive the company's stock price higher.
See More
Five Key Principles of Innovation
- Importance of Innovation Culture: Lorraine Marchand emphasizes that successful organizations foster a culture that reframes failure as a learning opportunity, encouraging experimentation and allowing employees to freely express new ideas, thereby enhancing the organization's innovative capacity.
- Investment Strategy in Risk: She notes that successful companies often follow a 70/20/10 investment ratio, with 10% allocated to uncertain innovation projects, a strategy validated by Google's success, indicating that appropriate risk investment can significantly drive company growth.
- Customer-First Strategy: Marchand points out that many companies fail to adjust to changing customer demands, leading to market failures; therefore, investors should focus on a company's customer-oriented strategies to avoid failures similar to those of Blockbuster and Kodak.
- Collaboration and Change Management: She highlights that collaboration has become a strategic imperative for corporate success, and organizations need to prioritize team collaboration during change to achieve breakthrough growth, ensuring that departments work together towards common objectives.
See More
Potential Economic Impact of Artificial Intelligence
- Impact on IBM: AI startup Anthropic PBC's announcement of its Claude Code tool modernizing COBOL led to a 13% drop in IBM's stock on February 23, marking its worst single-day loss since 2000, highlighting the direct threat AI poses to traditional companies.
- Unemployment Rate Warning: Citrini Research's report warns that AI could push unemployment above 10% by 2028, leading to a decline in economic demand as companies cut jobs, which could further pressure profits and exacerbate layoffs, creating a negative feedback loop.
- Market Reaction: The report spooked markets, causing the S&P 500 index to fall by 1% on the day of its release, reflecting investor anxiety over the potential economic crisis stemming from AI, indicating high uncertainty about future economic conditions.
- Economists' Perspectives: Despite the widespread discussion sparked by Citrini's predictions, many economists have criticized its assumptions, suggesting that AI could actually increase overall employment by enhancing productivity and creating new demand, indicating a divergence of views on AI's impact.
See More
Potential Economic Impact of AI-Induced Layoffs
- Layoff Concerns: Citrini Research's report suggests that AI could push the U.S. unemployment rate above 10% in the next two years, leading to a decline in aggregate demand and impacting economic growth, prompting investors to remain vigilant.
- IBM Stock Plunge: The announcement by AI startup Anthropic PBC regarding its Claude Code tool modernizing COBOL led to IBM's shares dropping 13% on February 23, marking its worst single-day loss since 2000, highlighting market sensitivity to AI impacts.
- Economic Feedback Loop: The report indicates that improved AI capabilities lead to layoffs, which reduce consumer spending, forcing companies to invest more in AI to protect margins, creating a negative feedback loop that could result in 'Ghost GDP', where economic growth does not translate into real consumption.
- Long-Term Investment Strategy: Despite concerns about AI's impact, The Motley Fool advises investors to adopt a long-term buy-and-hold strategy, focusing on companies with strong long-term strategies to leverage AI technology for competitive advantage.
See More
