International Business Machines reported fourth-quarter non-GAAP earnings per share of $4.52, surpassing consensus estimates by $0.19. Revenue rose 12.2% year-over-year to $19.69 billion, marking the company’s strongest constant-currency growth in over three years. Management projected more than 5% constant-currency revenue growth for fiscal 2026 and anticipates free cash flow to increase by approximately $1 billion from the 2025 base of $14.7 billion, driven by momentum in software and AI-powered services.

Following the earnings release, IBM shares jumped more than 5%, prompting increased inflows into exchange-traded funds with significant IBM weightings. Investors are monitoring broad technology and dividend-growth ETFs that allocate 3–5% of their assets to the company, betting that IBM’s renewed revenue acceleration and margin expansion will bolster total returns in 2026.

Pettee Investors raised its position in IBM by 14.3% during the third quarter, increasing holdings to 16,933 shares valued at $4.78 million and making it the firm’s eighth-largest position. Meanwhile, Director David N. Farr purchased 1,000 shares on January 30 at an average price of $304, boosting his stake to 9,258 shares. Institutional ownership accounts for nearly 59% of the float, while insiders hold 0.18%, underscoring both broad institutional conviction and selective insider confidence.