IBM shares climbed on Thursday, with the rally driven primarily by a strong earnings report from consulting rival Accenture rather than any IBM-specific catalyst. IBM stock rose as much as 5% during the session and was trading up 2% at the time of writing, later closing with a 2.6% gain — marking its best single day since September.
Accenture reported quarterly revenue of $9.28 billion, beating analyst expectations of $8.86 billion, and raised its full-year outlook. Accenture shares surged between roughly 16% and more than 20% in the session. The results reassured investors that consulting demand is holding up despite concerns that artificial intelligence could disrupt traditional consulting services. For IBM, consulting is its second-largest business unit, making Accenture's strength a positive read-through.
The rally follows a difficult stretch for IBM. The company's shares were down roughly 26% year to date through Wednesday's close. In July, IBM posted second-quarter revenue of $17.2 billion, below Wall Street forecasts, and reduced its full-year guidance. Infrastructure revenue fell 7% and consulting revenue was flat. CEO Arvind Krishna attributed the weak results to customers shifting budgets toward servers, storage and memory to get ahead of expected price increases for supply-constrained infrastructure, as well as execution issues that caused some large deals to slip.
Cognizant Technology, another consulting competitor, added to the positive sector tone after raising its annual profit forecast in July, and its shares also moved higher Thursday.
Separately, IBM announced a self-hosted deployment option for IBM Bob, its agentic software development platform. The offering supports on-premises, private-cloud, sovereign-cloud and air-gapped environments, targeting regulated industries that need stricter control over data residency, security policies and AI governance. “Organizations need AI that operates inside environments they have control over, especially when working with sensitive code and regulated data,” said Neel Sundaresan, GM of AI and Automation at IBM.
Looking ahead, IBM is scheduled to report third-quarter earnings later this month, with analysts expecting high-single-digit earnings growth. Wall Street currently has a Moderate Buy consensus rating and an average price target of $253.52. IBM also faces a securities-law investigation by Hagens Berman related to its July disclosure, following a one-day market-cap loss of more than $68 billion.
