International business machines today
International business machines
- 52 weeks
- 162.62 dollars
▼
265.72 dollars
- Profit
- 2.64 %
- P/E ratio.
- 39.45
- The target price
- 225.53 dollars
International business machines New York: IBM It was a strong start until 2025. The shares increased by 15 % from February 6. This was mostly due to the last profit report, which exceeded expectations. IBM, a less modern modern player in artificial intelligence, puts himself as an enormous power.
Besides the results of its strong profits, the company noted that it sees the development of the distilled Deepseek models as a verification of its strategy.
Below, I will dismantle the profit report and make more details about the company’s long -term strategy. I will finish by giving my participation in general on IBM shares.
IBM: Spike shares after increasing artificial intelligence reservations
after IBM Q4 2024 profitsThe shares of the technology company jumped about 13 % in one day. On revenue, the results came mainly in line with estimates at $ 17.6 billion, which showed only 2 % growth. The company’s programs led the road, with sales increase by 11 %. Its software solutions are largely focused on assistance in managing applications in mixed cloud environments. On the profits per share (EPS), the company dramatically won almost 4 % estimates, as the margins in the software sector increased by 220 basis points.
When it comes to AI, the company witnessed its reservations related to increasing technology by two billion dollars compared to the third quarter of 2024. This is a massive increase of 67 % in only one quarter. In Genai, the company’s reservations and revenues come 80 % of its consulting sector and 20 % of the software sector.
In consultations, the company works with companies to find out how it can implement Genai significantly to push the improvement performance. In general, the company’s advisory business grew only 1 % in the quarter. The company has strengthened this to the fact that customers “replay their information technology towards digital transformation and artificial intelligence initiatives.” Customer spending turns towards artificial intelligence. This change is likely to increase a strong increase in total consulting revenues.
International Business Machines Co. (IBM) for Friday, February 7, 2025
IBM: Genai can charge the effect of the budget wheel
To move forward, IBM hopes to take advantage of the effect of the budget wheel. The company says 80 % of its revenues come from customers who buy services in all its sectors. This includes software, consulting and infrastructure. This means that if you acquire a customer in one of these sectors, it often expands the relationship to others.
The rapid growth of the company’s Genai’s reservations creates excitement when thinking about the effect of a potential budget wheel. For me, consultations on how Genai should be a field in which companies continue to invest significantly over time. Understanding what artificial intelligence can do, especially from the perspective of work, is still developing. IBM notes that 98 % of companies have tried artificial intelligence, but only 26 % have determined these experiments to production. Since the artificial intelligence revolution has ripened from its early stages, IBM has a great opportunity to serve the needs of customers.
The company also believes that the appearance of Deepseek verifies the authenticity of its approach to language models. The company sees the small distilled Deepseek models as the strategy it uses to develop its own models. The company creates “integrated purposes” models. They excel in specific use cases instead of the goal of general capabilities. The performance of the granite parameter model compared seven billion with the identification platform model. Nasdak: Definition Llama 3 70 billion parameters of the parameter. IBM claims that when assigned to a specific commercial use, accounting, its model It was 6 % better performance while cost 75 % less. This is convincing. For me, this targeted strategy can meet customer needs at a more competitive price.
Final ideas on IBM
At this stage, IBM is trading the highest prices (P/E) over the past twenty years from 24x. This is a little less than the total technology sector, but the company is currently currently growing by only 2 %. The highest price of the company is appears in the Wedbush 18 % in stocks. For me, the IBM story in artificial intelligence exists. The penetration of possible budget wheel in space may be exciting. I would like to see the evaluation decreases, but IBM shares can continue to win even at these levels.
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