IBM

Q2 FY2026 EarningsQ2 FY26 results were mixed, with a slight top-line miss and normalized EPS largely in-line with consensus. Revenue of $17.16B fell 0.59% short of expectations, primarily due to a deeper-than-expected cyclical decline in IBM Z (-42% YoY) and missed deals in Transaction Processing. However, distributed infrastructure surged 37% and Red Hat grew 11%. Operating gross margin beat by 0.63pct, reaching 59.4%, though free cash flow was significantly lower than anticipated at $2.5B, driven by strategic inventory builds.