Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
IBM delivered a strong Q1 2024 with net income surging 73.1% YoY to $1.6B on modest 1.5% revenue growth to $14.5B, driven by improved margins and significantly higher operating cash flow.
Revenue
$14.46B
+1.47% YoY
EPS (Diluted)
$1.72
+70.30% YoY
Gross Margin
53.5%
+0.8 pts YoY
Source: SEC XBRL
IBM reported Q1 FY2024 revenue of $14.46B, up 1.5% year over year. Operating cash flow was $4.17B, up 10.4% year over year. IBM's fiscal Q1 FY2024 corresponds to calendar Q1 2024.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 2.93 | 3.00 | Miss -2.3% |
| Mar 2026 | 1.91 | 1.82 | Beat +4.7% |
| Dec 2025 | 4.52 | 4.36 | Beat +3.6% |
| Sep 2025 | 2.65 | 2.47 | Beat +7.3% |
Compiled by AI from this SEC filing
IBM reported Q1 2024 revenue of $14.46B, up 1.5% YoY from $14.25B, reflecting steady demand across its hybrid cloud and AI-focused portfolio despite a challenging macroeconomic environment.
Source: 10-Q Financial Data, Income Statement
Net income jumped 73.1% YoY to $1.605B from $927M, with diluted EPS rising 70.3% to $1.72, suggesting significant improvement in operational efficiency and/or favorable below-the-line items compared to the prior year period.
Source: 10-Q Financial Data, Income Statement
Gross profit grew 3.1% YoY to $7.74B, pushing gross margin up approximately 85 basis points to 53.5% from 52.7%, indicating IBM is generating more profit per dollar of revenue as its higher-margin software and services mix improves.
Source: 10-Q Financial Data, Income Statement & Key Ratios
Operating cash flow increased 10.4% YoY to $4.17B from $3.77B, demonstrating IBM's ability to convert earnings into cash effectively, which supports dividend payments and debt servicing on its $54B long-term debt load.
Source: 10-Q Financial Data, Cash Flow Statement
Cash and equivalents surged 56.4% YoY to $14.6B from $9.3B, providing IBM with substantial liquidity headroom, while investing cash outflows narrowed sharply to -$4.21B from -$7.96B, suggesting reduced acquisition spending compared to the prior year.
Source: 10-Q Financial Data, Balance Sheet & Cash Flow Statement
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
IBM carries $54.0B in long-term debt against stockholders' equity of $23.3B, resulting in a debt-to-equity ratio of approximately 4.89x. This elevated leverage limits financial flexibility and increases vulnerability to rising interest rates, which could materially increase interest expense and pressure free cash flow.
Source: 10-Q Financial Data, Balance Sheet & Key Ratios
R&D expenses rose 8.5% YoY to $1.80B and SG&A expenses grew 2.5% YoY to $4.97B, together totaling nearly $6.77B in operating expenses. If revenue growth remains modest at ~1.5%, the pace of expense growth could compress operating margins over time.
Source: 10-Q Financial Data, Income Statement
Revenue grew only 1.5% YoY while total liabilities increased 1.7% YoY to $113.8B, meaning IBM's obligations are growing faster than its top line. Sustained low revenue growth could make it increasingly difficult to service debt and fund strategic investments simultaneously.
Source: 10-Q Financial Data, Income Statement & Balance Sheet
Current liabilities rose 4.5% YoY to $32.4B while current assets grew only 1.9% YoY to $36.7B, compressing the current ratio to 1.13x. While still above 1.0x, the narrowing liquidity cushion warrants monitoring, particularly given IBM's large debt maturities.
Source: 10-Q Financial Data, Balance Sheet & Key Ratios
IBM operates in highly competitive markets for hybrid cloud infrastructure and AI services, facing rivals such as AWS, Microsoft Azure, and Google Cloud. Failure to maintain technological differentiation or win enterprise AI contracts could limit IBM's ability to accelerate revenue growth beyond the current low single-digit pace.
Source: 10-Q Financial Data, Income Statement (inferred from revenue growth trajectory)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 14.46 $B | 14.25 $B | +1.47% |
Cost of Revenue $B | 6.72 $B | 6.74 $B | -0.36% |
Gross Profit $B | 7.74 $B | 7.51 $B | +3.10% |
Net Income $B | 1.61 $B | 0.93 $B | +73.14% |
EPS (Basic) $ | 1.75 $ | 1.02 $ | +71.57% |
EPS (Diluted) $ | 1.72 $ | 1.01 $ | +70.30% |
R&D Expense $B | 1.80 $B | 1.66 $B | +8.52% |
SG&A Expense $B | 4.97 $B | 4.85 $B | +2.49% |
Answers draw on this SEC filing and the data on this page
IBM’s Q2 FY2026 revenue grew 1.1% to $17.2B, but an IBM Z-related Infrastructure shortfall and lower gross margin contributed to a 1.3% decline in net income to $2.2B. Source: 10-Q Item 2 MD&A, pp.46-47.
IBM delivered strong Q1 2026 results with revenue of $15.9B (+9.5% YoY) and net income of $1.2B (+15.3% YoY), driven by gross margin expansion to 56.2% and robust operating cash flow growth of 18.3%.
IBM delivered strong FY2025 results with revenue growing 7.6% to $67.5B and net income surging 75.9% to $10.6B, driven by gross margin expansion to 58.2% and likely boosted by the HashiCorp acquisition, though elevated debt and a current ratio below 1.0 warrant monitoring.
Other companies in IT Consulting & Other Services