In the most recent quarter, IBM reported non-GAAP operating margin of 22.6%, up from 21.9% a year earlier, reflecting disciplined cost management and higher-margin software sales. Revenue grew 9.1% year-over-year to $16.33 billion, driven by double-digit growth in hybrid cloud and AI software offerings. Net margin expanded to 12.1%, compared with 11.0% in the prior-year period, while return on equity increased to 37.8%, underscoring the efficiency of capital deployment and business mix shift toward recurring-revenue streams.

Large institutions have continued to reposition their IBM holdings. Cullen Frost Bankers lifted its stake by 3.8%, adding 3,227 shares to reach 88,856 shares at quarter end, representing approximately $25 million in market exposure. Global Assets Advisory increased its position by 33.5%, acquiring 3,024 additional shares to hold 12,044 shares, or about $3.4 million. Conversely, First Citizens Bank & Trust trimmed its position by 9.4%, selling 2,693 shares to end the period with 26,064 shares, signaling slight profit-taking after recent outperformance.

Equity research teams have updated their outlooks in light of IBM’s stronger-than-expected quarterly results. Royal Bank of Canada upgraded its rating to Outperform and raised its 12-month target from 300 to 350, citing accelerating AI software bookings. Jefferies upgraded from Hold to Buy and boosted its target to 360, highlighting improving consulting margins and the integration of recent strategic acquisitions. BMO Capital Markets maintained its Market Perform view but lifted its target to 305, pointing to the steady expansion of high-value software segments as a key earnings driver.