International Business Machines IBM remained under pressure after CNBC’s Jim Cramer said the stock is not yet attractive despite its steep selloff, following the company’s preliminary second-quarter revenue miss that highlighted changing enterprise technology spending patterns.
IBM reported preliminary second-quarter revenue of $17.2 billion, missing analysts’ expectation of $17.9 billion. The company said some customers redirected spending toward servers, storage and memory as businesses sought AI-related infrastructure amid supply constraints and anticipated price increases.
Cramer said corporate technology budgets are becoming increasingly focused on artificial intelligence infrastructure, cybersecurity and hardware, while other information technology projects are receiving lower priority. He said that shift could continue to weigh on IBM’s business even though the company has expanded its AI offerings.
IBM Chief Executive Arvind Krishna said customer purchasing patterns changed during the final weeks of June as clients prioritized infrastructure spending. Cramer noted IBM continues to have established businesses and a dividend yield above 3%, but said he remains cautious until there is stronger evidence that delayed customer spending will recover rather than be canceled. IBM shares had fallen more than 25% in the previous session.