IBM shares plunge 26% on Q2 revenue miss, marking worst drop since 1987

The historic sell-off follows a preliminary profit warning that revealed adjusted earnings fell short of expectations, casting doubt on the company's AI growth narrative.

By Handelsavisen Newsroom · Automated 2026-07-16 15:22 UTC · 1 min read Last updated: 2026-07-16 20:07 UTC

IBM shares suffered their most severe single-day decline in nearly four decades, plunging 26% in US trading on Tuesday.

The collapse marks the steepest drop for the technology giant since the 1987 market crash, wiping out billions in market value within hours of the open.

Handelsavisen previously reported that IBM shares had already fallen more than 17% in premarket trading after the initial disclosure of the earnings miss.

The sell-off was triggered by a preliminary profit warning for the second quarter, which disclosed that preliminary revenues came in at $17.2 billion.

This figure fell short of market expectations, signaling that the company’s transition to AI-driven growth is facing headwinds.

The disappointment in the top-line numbers compounded concerns about the sustainability of IBM’s recent valuation premium.

Handelsavisen previously reported that IBM shares had already fallen more than 17% in premarket trading after the initial disclosure of the earnings miss. The full-session collapse extended that damage, with the stock continuing to slide throughout the day as investors reassessed the company’s near-term outlook.