IBM shares plunged at the open after preliminary earnings fell below expectations, while the timing of Jim Cramer’s bullish call fueled online jokes.
IBM Stock Crashes 25% After Surprise Profit Warning
IBM shares plunged about 25% after the company released preliminary second-quarter figures that fell below Wall Street expectations. The sell-off pushed the stock toward $219 after it opened near $226 and traded as low as about $216.
IBM expects quarterly revenue of about $17.2 billion, compared with analysts’ estimate of roughly $17.86 billion. Adjusted earnings are expected to reach $2.93 per share, also below market forecasts.
The company blamed the shortfall on delayed large deals and changes in customer spending. Clients prioritized servers, storage and memory amid supply concerns and expected price increases, weakening demand across parts of IBM’s software and infrastructure businesses.
The sharp decline also pressured other software stocks as investors questioned whether spending on AI infrastructure is taking money away from traditional enterprise software. IBM’s warning therefore became a wider signal for the technology sector rather than an isolated company issue.
These are preliminary figures, not IBM’s complete earnings report. The company is scheduled to publish its official second-quarter results on July 22, when investors will receive updated guidance and more detail on the missed deals.
IBM Sell-Off Revives the ‘Inverse Cramer’ Joke
IBM’s sharp decline came one day after Jim Cramer called it “a great time” to buy the stock, quickly turning the timing into a social media joke.
Cramer published the bullish call on July 13, telling followers to buy IBM. After the stock dropped the next day, users circulated screenshots of the post and again referenced the so-called “Inverse Cramer” theory.
The phrase describes the online belief that investors could profit by doing the opposite of Cramer’s public recommendations. It has become a recurring meme whenever a stock moves sharply against one of his calls.
Cramer’s recommendation did not cause IBM’s decline. However, the timing gave his critics another high-profile example to use against his market record.
