International Business Machines (IBM) shares suffered their most severe single-day decline in history on Tuesday, plunging approximately 25% in US trading.
The collapse was triggered by the company's preliminary profit warning for the second quarter, which signaled earnings significantly below market expectations.
The sell-off represents the steepest drop for the stock since the 1987 market crash, underscoring the severity of investor disappointment with the tech giant's performance.
The sharp repricing reflects a sudden loss of confidence in IBM's ability to meet its financial targets amid a challenging macroeconomic environment.
While the broader market experienced volatility, with major US banks reporting quarterly earnings and June inflation data coming in better than expected, IBM's specific guidance miss dominated the narrative for the stock.
The magnitude of the decline suggests that the market is rapidly adjusting its valuation model for the company, pricing in a prolonged period of weaker profitability.