Ibm S Journey From Tech Giant To Ai Darling Here S How

Bonisiwe Shabane

-Oct 26, 2025, 3:52 AM

ibm s journey from tech giant to ai darling here s how

IBM is no longer just a legacy tech giant—its focus on Watsonx, Granite AI models, and enterprise-first innovation is reshaping its role as a key force in artificial intelligence and hybrid cloud computing. Once synonymous with mainframe and enterprise hardware domination, IBM has stealthily become a top player in the international AI wars. IBM has plotted a different course, as opposed to other brands like Google, OpenAI, and more. This branding is based on enterprise-level innovation, strategic shifts, and measured risk-taking. IBM’s makeover wasn’t overnight. It started building the foundation decades earlier with symbolic mileposts, Deep Blue’s 1997 chess victory over Garry Kasparov, and Watson’s Jeopardy!

Won in 2011. Impressive as they were, those feats were so much about establishing AI’s potential as a technology and less about realizing its commercial potential. The actual inflection point arrived in 2020, when Arvind Krishna became CEO. With a strong heritage in cloud and AI, Krishna launched a company-wide transformation that guided IBM away from its low-growth legacy businesses and into emerging markets with greater margins. Among some of Krishna’s most important moves was the $34-billion acquisition of Red Hat in 2019-until then, the largest acquisition ever undertaken by IBM. As a result, the acquisition helped put IBM's hybrid cloud in the front seat and also helped create the architecture to support AI models securely and at scale across disparate environments.

IBM's shift to being an AI company is starting to pay off big time. It's doubling down on its AI strategy, unveiling new products at its Think conference on Tuesday. "It's still the first inning in a nine-inning game," the Wedbush analyst Dan Ives told Business Insider. IBM's identity is shifting from boring mainframe computers to fast-growing artificial intelligence as the 113-year-old company doubles down on AI. At its IBM Think conference on Tuesday, CEO Arvind Krishna unveiled a host of new AI products and services in a bid to grow its generative AI operations, which he said had turned into... ARMONK, N.Y., May 6, 2025 /PRNewswire/ -- Today at the company's annual THINK event, IBM (NYSE: IBM) is unveiling new hybrid technologies that break down the longstanding barriers to scaling enterprise AI – enabling...

IBM estimates that over one billion apps will emerge by 2028, putting pressure on businesses to scale across increasingly fragmented environments. This requires seamless integration, orchestration and data readiness. A new IBM CEO study shows that business leaders expect the growth rate of AI investments to more than double over the next two years, with most actively adopting AI agents and preparing to... Yet their pace of investments has led to disconnected technology – and only 25% of AI initiatives have achieved the ROI they expected. IBM is combining hybrid technologies, agent capabilities and deep industry expertise from IBM Consulting to help businesses operationalize AI. "The era of AI experimentation is over.

Today's competitive advantage comes from purpose-built AI integration that drives measurable business outcomes," said Arvind Krishna, Chairman and CEO, IBM. "IBM is equipping enterprises with hybrid technologies that cut through complexity and accelerate production-ready AI implementations." IBM’s story is a powerful testament to the transformative power of innovation, collaboration, and the willingness to adapt. The company’s journey through the digital age offers a blueprint for businesses looking to stay relevant and competitive in an ever-changing world. IBM has not only survived but thrived by embracing new technologies and by continuously reimagining its business approach. In the past, IBM was known as a hardware company, but it saw that the future would require more than just physical products.

The company made a bold shift by rethinking its business logic. It moved from selling hardware to offering solutions—software, cloud services, and AI-powered platforms like Watson. This shift wasn’t just about changing what IBM sold, but about changing how it framed its role in the world. Instead of just providing products, IBM began solving complex, real-world problems across industries like healthcare and finance. The company looked at these challenges not as isolated issues but as interconnected problems that could be tackled through data-driven solutions. This approach was about solving bigger problems in society and business, making a real impact with its offerings.

One of the most significant ways IBM achieved this was by embracing design thinking. This mindset wasn’t just about creating new products, but about deeply understanding the user experience and the challenges people faced. IBM made sure that its solutions were not only functional but intuitive and accessible. When IBM developed Watson Health, for example, it wasn’t just about creating a sophisticated AI; it was about making it easy for healthcare professionals to use and ensuring it had a tangible impact on... By putting the customer at the center of its innovation, IBM created technology that truly addressed pain points and offered practical solutions. {"@context":"https://schema.org","@type":"FAQPage","mainEntity":[{"@type":"Question","name":"What is IBM's WatsonX platform, and how does it work?","acceptedAnswer":{"@type":"Answer","text":"IBM's WatsonX platform focuses on generative AI capabilities, allowing businesses to automate processes and enhance decision-making.

It includes various tools to help organizations leverage AI for operational efficiency."}},{"@type":"Question","name":"Is IBM's stock a good investment?","acceptedAnswer":{"@type":"Answer","text":"While IBM's stock has performed well recently, it remains reasonably priced compared to market averages. Investors should consider both the company's historical performance and current market conditions before making investment decisions."}},{"@type":"Question","name":"What are the main competitors to IBM in AI?","acceptedAnswer":{"@type":"Answer","text":"IBM competes with several tech giants in the AI space, including... Its investment in generative AI technologies with WatsonX is part of its strategy to redefine its relevance in the tech landscape."}}]}{ "@context": "https://schema.org", "@type": "Article", "headline": "IBM's Transformative Journey: Why It’s Time to Reconsider... IBM, a longstanding titan of the tech industry, has recently made waves with its renewed focus on AI through its WatsonX platform. Once considered a laggard in this transformative space, IBM is reemerging as a significant player, evidenced by exponential growth in its order book and revenues. As businesses globally adapt to the AI revolution, IBM's strategic maneuvers could redefine not only its market position but also offer investors new opportunities for growth.\n\nIn this article, we will unpack IBM's recent performance...

\n\n## IBM's AI Party is Just Getting Started\nIBM's late entry into the generative AI arena has not hindered its ability to create substantial market traction. The WatsonX platform, which focuses on generative AI capabilities, reported firm orders of $2 billion in mid-2024. Remarkably, this figure skyrocketed to $7.5 billion by the second quarter of 2025. This impressive growth underscores IBM's commitment to establishing a robust foothold in AI.\n\nThe significance of WatsonX extends beyond its impressive order book; it is indicative of a broader strategy to diversify and enhance IBM's... In addition to WatsonX, IBM has developed numerous other AI services, such as the Granite platform for cloud-based AI solutions and tailored AI systems accessible through its Red Hat Enterprise Linux. This expanded arsenal of products positions IBM to cater to various business needs, from infrastructure support to complex AI-driven analytics.\n\n### The Competitive Edge of WatsonX\nWatsonX provides businesses with powerful tools to harness generative AI,...

As the demand for AI solutions continues to soar, companies leveraging WatsonX are likely to gain significant advantages in operational efficiency and innovation. \n\nIBM's strategic investment in AI research and development, coupled with its longstanding experience in enterprise technology, places it in a prominent position relative to competitors. This combination of innovation and expertise positions IBM as a nuanced choice for enterprises eyeing AI adoption, particularly in sectors where integrating machine learning and data analytics can lead to transformative outcomes.\n\n## A Big,... The company has experienced revenue growth not seen consistently since 2011—evidence that the tide may finally be turning in its favor. Over the past year, IBM’s stock has increased by 27%, resulting in a remarkable 114% rise over the past three years. These upward trends are particularly striking considering that IBM's stock had been trading at a substantial discount well into 2022.\n\nThis dramatic resurgence in stock performance suggests that market momentum is playing a crucial role...

As organizations recognize the potential of AI to improve efficiencies and optimize operations, IBM’s offerings are coming into sharper focus. \n\n### Understanding Momentum Investing\nMomentum investing is characterized by buying into stocks that have exhibited an upward price trajectory. While some investors may shy away from stocks that have rapidly appreciated in value, such sentiment can fail to account for the underlying fundamentals driving that growth. In IBM’s case, the exponential rise in its order book and the steady improvement in its revenue metrics may justify continued investment in its shares.\n\nMoreover, strong market momentum often attracts institutional investors, further driving... This creates a potential cycle where rising share prices can lead to greater investor interest, perpetuating the stock’s climb while simultaneously enhancing IBM's visibility in the tech sector.\n\n## The Stock Still Looks Affordable\nDespite its... Currently, shares trade at a forward price-to-earnings (P/E) ratio of 22.7 and a trailing price-to-free-cash-flow (P/FCF) ratio of 20.7.

For comparison, the average P/E ratio for S&P 500 companies stands at approximately 24, while the average P/FCF is about 29.9. This disparity indicates that while IBM's stock is gaining ground, it still presents an opportunity for value-seeking investors.\n\n### Valuation Metrics Explained\nUnderstanding valuation metrics is crucial for assessing investment opportunities. The P/E ratio indicates how much investors are willing to pay for a dollar of earnings, whereas the P/FCF ratio reflects a company's financial performance in generating cash flow. When a stock trades lower than peers based on these metrics, it may suggest that it is undervalued relative to its potential growth trajectory.\n\nAlthough IBM's stock has shown a robust upward trend, its valuation... This makes IBM a compelling option for investors looking to balance risk and return in their portfolios.\n\n## Should You Invest $1,000 in International Business Machines Right Now?\nBefore committing investment capital, prospective investors should examine... The tech giant has shown resilience and adaptability, characteristics financially astute investors typically seek.

\n\nIf an investor were to consider a $1,000 investment in IBM, they should weigh various elements such as market conditions, competitive positioning, and overall corporate strategy. IBM's focus on AI and expansion of its service offerings positions it favorably for future growth, but industry dynamics can introduce risks as well.\n\n### The Historical Context of IBM\nIBM has a long history of... The company’s previous forays into emerging technologies often yielded mixed results, highlighting the inherent risks associated with its strategy shifts. However, the successful launch and scaling of WatsonX suggest that IBM has learned from its past and is aggressively pursuing opportunities in AI, which could translate to sustainable growth moving forward.\n\n### Alternative Investment Options\nInvestors... The *Motley Fool Stock Advisor* recently identified ten stocks that demonstrate an attractive potential for substantial returns over the coming years, none of which include IBM. This consideration raises the question: Is IBM a sufficient investment at this juncture, or might funds achieve better returns in other opportunities?\n\nInvestors should conduct thorough research, assess their risk tolerance levels, and consider diversifying...

It includes various tools to help organizations leverage AI for operational efficiency.\n\n### Is IBM's stock a good investment?\nWhile IBM's stock has performed well recently, it remains reasonably priced compared to market averages. Investors should consider both the company's historical performance and current market conditions before making investment decisions.\n\n### What are the main competitors to IBM in AI?\nIBM competes with several tech giants in the AI space,... Its investment in generative AI technologies with WatsonX is part of its strategy to redefine its relevance in the tech landscape.\n\nIn summary, as IBM seeks to redefine its role in the fast-evolving AI landscape,... The journey ahead promises opportunities, provided that investors remain vigilant and informed about market dynamics and IBM's strategic directions." } The realm of artificial intelligence (AI) has rapidly evolved into a critical driver of business innovation, with various companies racing to leverage its capabilities. IBM, a longstanding titan of the tech industry, has recently made waves with its renewed focus on AI through its WatsonX platform.

Once considered a laggard in this transformative space, IBM is reemerging as a significant player, evidenced by exponential growth in its order book and revenues. As businesses globally adapt to the AI revolution, IBM’s strategic maneuvers could redefine not only its market position but also offer investors new opportunities for growth. In this article, we will unpack IBM’s recent performance metrics, explore the implications of its innovations, and evaluate the factors that may justify a renewed investor interest in this storied company. IBM’s late entry into the generative AI arena has not hindered its ability to create substantial market traction. The WatsonX platform, which focuses on generative AI capabilities, reported firm orders of $2 billion in mid-2024. Remarkably, this figure skyrocketed to $7.5 billion by the second quarter of 2025.

This impressive growth underscores IBM’s commitment to establishing a robust foothold in AI. The significance of WatsonX extends beyond its impressive order book; it is indicative of a broader strategy to diversify and enhance IBM’s AI offerings. In addition to WatsonX, IBM has developed numerous other AI services, such as the Granite platform for cloud-based AI solutions and tailored AI systems accessible through its Red Hat Enterprise Linux. This expanded arsenal of products positions IBM to cater to various business needs, from infrastructure support to complex AI-driven analytics. Find out how IBM successfully reinvented its business model twice, moving from hardware to services to AI and cloud computing. IBM is a multinational company that provides hardware, software, and related services in any computer-related field.

Established in 1911, the International Business Machines company has garnered a reputation for making bigger computers known as “mainframes” that take up entire rooms. As IBM keeps reinventing itself and creating newer products, today it has over 270,300 employees present in more than 170 countries. The company’s revenue in 2024 sits at $62.7 billion. Business reinvention expert Dr. Nadya Zhexembayeva says that IBM is a great example of how companies reinvent themselves before they have to. IBM didn't wait for failure to force change.

Ibm S Journey From Tech Giant To Ai Darling Here S How

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