International Business Machines Corporation (IBM) Income Statement

30Y historyFree accessUpdated daily

IBM's income statement reflects a mixed trajectory, with volatile revenue growth (0.6% to 12.2% YoY) but a clear structural improvement in profitability, as gross margins have expanded by 420 basis points from 53.5% in Q1 2024 to 57.7% in Q2 2026.

Annual statement

IBM Income Statement

International Business Machines Corporation (IBM) annual income statement — 30-year revenue, gross profit & net income history

Annual Quarterly

Metric	TTM	Dec'25	Dec'24	Dec'23	Dec'22	Dec'21	Dec'20	Dec'19	Dec'18	Dec'17	Dec'16	Dec'15	Dec'14	Dec'13	Dec'12	Dec'11	Dec'10	Dec'09	Dec'08	Dec'07	Dec'06	Dec'05	Dec'04	Dec'03	Dec'02	Dec'01	Dec'00	Dec'99	Dec'98	Dec'97	Dec'96

Sales/Revenue	69.1B	67.54B	62.75B	61.86B	60.53B	57.35B	55.18B	57.71B	79.59B	79.14B	79.92B	81.74B	92.79B	98.37B	102.87B	106.92B	99.87B	95.76B	103.63B	98.79B	91.42B	91.13B	96.29B	89.13B	81.19B	83.07B	88.4B	87.55B	81.67B	78.51B	73.42B
Revenue Growth %	7.9%	7.62%	1.44%	2.2%	5.54%	3.94%	-4.39%	-27.49%	0.57%	-0.98%	-2.23%	-11.91%	-5.67%	-4.38%	-3.78%	7.05%	4.3%	-7.6%	4.9%	8.05%	0.32%	-5.36%	8.04%	9.79%	-2.26%	-6.03%	0.97%	7.2%	4.02%	6.92%	2.06%
Cost of Goods Sold	28.72B	28.24B	27.2B	27.56B	27.84B	25.86B	24.31B	26.18B	42.66B	42.2B	41.4B	41.06B	46.39B	49.68B	52.51B	56.78B	53.86B	51.97B	57.97B	57.06B	53.13B	54.6B	60.72B	56.58B	50.9B	51.18B	55.97B	55.62B	50.8B	47.9B	45.41B
COGS % of Revenue	-	41.81%	43.35%	44.55%	46%	45.1%	44.06%	45.36%	53.59%	53.32%	51.81%	50.23%	49.99%	50.51%	51.05%	53.11%	53.93%	54.28%	55.94%	57.76%	58.11%	59.91%	63.06%	63.48%	62.7%	61.61%	63.32%	63.53%	62.2%	61.01%	61.84%
Gross Profit	40.38B	39.3B	35.55B	34.3B	32.69B	31.49B	30.86B	31.53B	36.94B	36.94B	38.52B	40.68B	46.41B	48.68B	50.36B	50.14B	46.01B	43.78B	45.66B	41.73B	38.3B	36.53B	35.57B	32.55B	30.28B	31.89B	32.42B	31.93B	30.87B	30.61B	28.02B
Gross Margin %	58.43%	58.19%	56.65%	55.45%	54%	54.9%	55.94%	54.64%	46.41%	46.68%	48.19%	49.77%	50.01%	49.49%	48.95%	46.89%	46.07%	45.72%	44.06%	42.24%	41.89%	40.09%	36.94%	36.52%	37.3%	38.39%	36.68%	36.47%	37.8%	38.99%	38.16%
Gross Profit Growth %	-	10.54%	3.65%	4.93%	3.81%	2.01%	-2.12%	-14.63%	-0.02%	-4.08%	-5.33%	-12.33%	-4.68%	-3.33%	0.44%	8.96%	5.09%	-4.11%	9.42%	8.97%	4.83%	2.71%	9.29%	7.47%	-5.03%	-1.65%	1.55%	3.42%	0.86%	9.26%	-7.74%
Operating Expenses	28.03B	26.8B	25.48B	24.48B	24.51B	24.62B	26.2B	24B	23.72B	23.8B	24.88B	24.76B	27.54B	28.22B	28.16B	28.66B	26.67B	26.77B	29.72B	28.21B	26.37B	27.16B	25.95B	23.91B	23.49B	22.03B	20.79B	20B	21.71B	21.51B	21.94B
OpEx % of Revenue	-	39.69%	40.6%	39.57%	40.5%	42.93%	47.49%	41.58%	29.8%	30.08%	31.13%	30.3%	29.68%	28.68%	27.37%	26.8%	26.7%	27.96%	28.68%	28.56%	28.84%	29.8%	26.95%	26.83%	28.93%	26.53%	23.52%	22.85%	26.58%	27.4%	29.89%
Selling, General & Admin	18.96B	18.14B	17.91B	17.56B	18.61B	18.75B	20.56B	18.72B	19.37B	19.68B	20.28B	19.89B	22.47B	22.92B	23.09B	23.22B	21.55B	20.52B	22.77B	22.06B	20.26B	21.31B	20.08B	18.6B	18.74B	17.05B	15.64B	14.73B	16.66B	16.63B	16.85B
SG&A % of Revenue	-	26.86%	28.54%	28.39%	30.74%	32.68%	37.26%	32.44%	24.33%	24.87%	25.37%	24.34%	24.22%	23.3%	22.44%	21.72%	21.57%	21.43%	21.98%	22.33%	22.16%	23.39%	20.85%	20.87%	23.08%	20.52%	17.69%	16.82%	20.4%	21.19%	22.95%
Research & Development	8.75B	8.32B	7.48B	6.78B	6.57B	6.49B	6.26B	5.91B	5.38B	5.59B	5.73B	5.25B	5.44B	5.74B	5.82B	6.26B	6.03B	5.82B	6.34B	6.15B	6.11B	5.84B	5.87B	5.31B	4.75B	4.99B	5.15B	5.27B	5.05B	4.88B	5.09B
R&D % of Revenue	-	12.31%	11.92%	10.95%	10.85%	11.31%	11.35%	10.24%	6.76%	7.06%	7.16%	6.42%	5.86%	5.84%	5.65%	5.85%	6.03%	6.08%	6.12%	6.23%	6.68%	6.41%	6.1%	5.96%	5.85%	6%	5.83%	6.02%	6.18%	6.21%	6.93%
Other Operating Expenses	3M	348M	89M	145M	-662M	-612M	-620M	-639M	-1.03B	-1.47B	-1.13B	-377M	-368M	-451M	-746M	-819M	-901M	432M	612M	0	0	0	0	0	0	0	0	0	0	0	0
Operating Income	12.34B	12.49B	10.07B	9.82B	8.17B	6.87B	4.66B	7.54B	13.22B	13.14B	14.68B	16.51B	20.34B	21.5B	22.99B	21.92B	19.98B	17.01B	15.94B	13.52B	11.93B	9.38B	9.62B	8.63B	6.8B	9.86B	11.63B	11.93B	9.16B	9.1B	6.07B
Operating Margin %	17.86%	18.5%	16.05%	15.88%	13.5%	11.97%	8.45%	13.06%	16.61%	16.6%	18.36%	20.2%	21.92%	21.86%	22.35%	20.5%	20.01%	17.77%	15.38%	13.68%	13.05%	10.29%	9.99%	9.68%	8.37%	11.86%	13.16%	13.62%	11.22%	11.59%	8.27%
Operating Income Growth %	-	24%	2.58%	20.15%	19.07%	47.25%	-38.15%	-42.97%	0.59%	-10.48%	-11.09%	-18.83%	-5.4%	-6.48%	4.87%	9.69%	17.48%	6.73%	17.93%	13.3%	27.23%	-2.5%	11.4%	27.02%	-31.04%	-15.29%	-2.46%	30.15%	0.73%	49.81%	-20%
EBITDA	16.55B	17.51B	14.74B	14.22B	12.98B	13.28B	11.36B	13.6B	17.7B	17.68B	19.06B	20.36B	24.83B	26.18B	27.67B	26.74B	24.82B	22.01B	21.39B	18.72B	16.91B	14.56B	14.53B	13.55B	11.29B	14.36B	16.63B	18.51B	14.16B	14.1B	11.09B
EBITDA Margin %	23.95%	25.93%	23.49%	22.98%	21.44%	23.16%	20.58%	23.56%	22.23%	22.34%	23.85%	24.91%	26.76%	26.61%	26.89%	25.01%	24.85%	22.98%	20.64%	18.95%	18.5%	15.98%	15.09%	15.2%	13.91%	17.29%	18.81%	21.14%	17.33%	17.96%	15.1%
EBITDA Growth %	5.04%	18.8%	3.69%	9.56%	-2.3%	16.95%	-16.47%	-23.17%	0.1%	-7.23%	-6.41%	-17.99%	-5.15%	-5.38%	3.47%	7.74%	12.77%	2.88%	14.28%	10.67%	16.12%	0.23%	7.26%	20.01%	-21.39%	-13.64%	-10.17%	30.77%	0.4%	27.19%	-15.98%
D&A (Non-Cash Add-back)	3.85B	5.02B	4.67B	4.4B	4.8B	6.42B	6.7B	6.06B	4.48B	4.54B	4.38B	3.85B	4.49B	4.68B	4.68B	4.82B	4.83B	4.99B	5.45B	5.2B	4.98B	5.19B	4.92B	4.92B	4.49B	4.51B	5B	6.58B	4.99B	5B	5.01B
EBIT	12.37B	12.26B	7.51B	10.3B	2.37B	5.99B	3.86B	8.55B	12.06B	12.02B	12.96B	16.41B	20.47B	20.65B	23B	21.41B	20.09B	18.54B	17.39B	15.1B	13.6B	12.45B	10.81B	9.56B	7.67B	9.86B	12.25B	12.48B	9.75B	9.76B	9.3B
Net Interest Income	-1.5B	-1.29B	-965M	-937M	-1.05B	-1.1B	-1.18B	-673M	-422M	-519M	-522M	-360M	-394M	-328M	-350M	-275M	-276M	-308M	-330M	-611M	-278M	-220M	-139M	-145M	-145M	0	-717M	-727M	-713M	-728M	-9M
Interest Income	434M	645M	747M	670M	162M	52M	105M	349M	264M	144M	108M	108M	90M	74M	109M	136M	92M	94M	343M	0	0	0	0	0	0	0	0	0	0	0	707M
Interest Expense	1.93B	1.94B	1.71B	1.61B	1.22B	1.16B	1.29B	1.02B	686M	663M	630M	468M	484M	402M	459M	411M	368M	402M	673M	611M	278M	220M	139M	145M	145M	0	717M	727M	713M	728M	716M
Other Income/Expense	-1.9B	-2.16B	-4.28B	-1.13B	-7.02B	-2.03B	-2.09B	-332M	-1.88B	-1.74B	-2.35B	-563M	-352M	-1.26B	-450M	-919M	-262M	1.13B	776M	973M	1.39B	2.85B	1.05B	785M	728M	1.59B	-100M	-170M	-124M	-71M	2.51B
Pretax Income	10.44B	10.33B	5.8B	8.69B	1.16B	4.84B	2.57B	7.21B	11.34B	11.4B	12.33B	15.95B	19.99B	20.24B	22.54B	21B	19.72B	18.14B	16.71B	14.49B	13.32B	12.23B	10.67B	9.42B	7.52B	11.45B	11.53B	11.76B	9.04B	9.03B	8.59B
Pretax Margin %	15.11%	15.29%	9.24%	14.05%	1.91%	8.43%	4.66%	12.49%	14.25%	14.41%	15.43%	19.51%	21.54%	20.58%	21.91%	19.64%	19.75%	18.94%	16.13%	14.67%	14.57%	13.42%	11.08%	10.57%	9.27%	13.78%	13.05%	13.43%	11.07%	11.5%	11.7%
Income Tax	-264M	-242M	-218M	1.18B	-626M	124M	-1.36B	60M	2.62B	5.64B	449M	2.58B	4.23B	3.36B	5.54B	5.15B	4.89B	4.71B	4.38B	4.07B	3.9B	4.23B	3.17B	2.83B	2.19B	3.3B	3.44B	4.04B	2.71B	2.93B	3.16B
Effective Tax Rate %	-2.53%	-2.34%	-3.76%	13.53%	-54.15%	2.56%	-52.88%	0.83%	23.09%	49.49%	3.64%	16.19%	21.18%	16.61%	24.58%	24.51%	24.79%	25.98%	26.21%	28.1%	29.29%	34.61%	29.73%	30.04%	29.11%	28.86%	29.83%	34.41%	30%	32.5%	36.78%
Net Income	10.72B	10.59B	6.02B	7.5B	1.64B	5.74B	5.59B	9.43B	8.73B	5.75B	11.87B	13.19B	12.02B	16.48B	16.6B	15.86B	14.83B	13.43B	12.33B	10.42B	9.49B	7.93B	7.48B	6.56B	3.58B	7.72B	8.09B	7.71B	6.33B	6.09B	5.43B
Net Margin %	15.52%	15.68%	9.6%	12.13%	2.71%	10.01%	10.13%	16.34%	10.97%	7.27%	14.85%	16.14%	12.96%	16.76%	16.14%	14.83%	14.85%	14.02%	11.9%	10.55%	10.38%	8.71%	7.77%	7.36%	4.41%	9.3%	9.16%	8.81%	7.75%	7.76%	7.39%
Net Income Growth %	83.87%	75.88%	-19.71%	357.44%	-71.44%	2.72%	-40.73%	8.05%	51.71%	-51.54%	-9.99%	9.72%	-27.06%	-0.73%	4.72%	6.89%	10.49%	8.85%	18.39%	9.76%	19.64%	6.08%	14.04%	83.24%	-53.66%	-4.57%	4.94%	21.87%	3.86%	12.23%	29.94%
Net Income (Continuing)	10.7B	10.57B	6.01B	7.51B	1.78B	4.71B	3.93B	7.15B	8.72B	5.76B	11.88B	13.36B	15.75B	16.88B	17B	15.86B	14.83B	13.43B	12.33B	10.42B	9.42B	7.99B	7.5B	6.59B	5.33B	8.15B	8.09B	7.71B	6.33B	6.09B	5.43B
Discontinued Operations	0	22M	8M	-12M	-143M	1.03B	1.66B	2.29B	5M	-5M	-9M	-174M	-3.73B	-398M	-395M	0	0	0	0	0	76M	-24M	-18M	-30M	-1.75B	-423M	0	0	0	0	0
Minority Interest	89M	93M	86M	80M	77M	95M	129M	144M	134M	131M	146M	162M	146M	137M	124M	97M	126M	118M	0	0	0	0	0	0	0	0	0	0	0	0	0
EPS (Diluted)	11.26	11.17	6.43	8.14	1.80	6.35	6.23	10.56	9.53	6.14	12.38	13.42	11.90	14.94	14.37	13.06	11.52	10.01	8.93	7.18	6.11	4.87	4.93	4.32	2.06	4.35	4.44	4.12	3.29	3.01	2.56
EPS Growth %	83.44%	73.72%	-21.01%	352.22%	-71.65%	1.93%	-41%	10.81%	55.21%	-50.4%	-7.75%	12.77%	-20.35%	3.97%	10.03%	13.37%	15.08%	12.09%	24.37%	17.51%	25.46%	-1.22%	14.12%	109.71%	-52.64%	-2.03%	7.77%	25.23%	9.3%	17.58%	41.44%
EPS (Basic)	-	11.36	6.53	8.23	1.82	6.41	6.28	10.63	9.57	6.17	12.43	13.48	11.97	15.06	14.53	13.25	11.69	10.12	9.07	7.32	6.20	4.96	5.03	4.40	2.10	4.45	4.58	4.25	3.38	3.09	2.56
Diluted Shares Outstanding	952.7M	948.7M	937.2M	922.07M	912.27M	904.64M	896.56M	892.81M	916.3M	937.4M	958.7M	982.7M	1.01B	1.1B	1.16B	1.21B	1.29B	1.34B	1.38B	1.45B	1.55B	1.63B	1.71B	1.76B	1.73B	1.77B	1.81B	1.87B	1.92B	2.02B	2.13B
Basic Shares Outstanding	939.9M	932.3M	937.2M	911.21M	902.66M	895.99M	890.35M	887.24M	912M	932.8M	955.4M	978.7M	1B	1.09B	1.14B	1.2B	1.27B	1.33B	1.36B	1.42B	1.53B	1.6B	1.67B	1.72B	1.7B	1.73B	1.76B	1.81B	1.87B	1.97B	2.11B
Dividend Payout Ratio	-	59.05%	102.06%	80.51%	362.68%	102.21%	103.7%	60.51%	64.92%	95.71%	44.27%	37.13%	35.48%	24.62%	22.72%	21.9%	21.42%	21.3%	20.96%	20.61%	17.73%	15.75%	15.7%	16.54%	28.08%	12.51%	11.48%	11.4%	13.18%	12.85%	13%

Key Metrics

Growth RegimeMixed

ProfitabilityModerate

Balance SheetStrained

Cash FlowMixed

Top Statement Risk

Elevated leverage constrains optionality

Verified Source

Metrics are mathematically derived from official filings.

SEC 10-K (2026Q2)

Volatile Growth Masks Underlying Strength

IBM's revenue trajectory is highly inconsistent, ranging from 0.6% to 12.2% year-over-year growth over the past ten quarters, suggesting the business is subject to significant lumpiness from product cycles and large deal timing.

The erratic quarterly growth pattern, with swings from near-flat to double-digit increases, appears driven by the lumpy nature of mainframe refresh cycles in the Infrastructure segment and the timing of large consulting engagements. This volatility complicates forecasting and indicates that underlying organic growth may be less robust than individual strong quarters suggest. Investors should monitor the consistency of software subscription growth as a more stable indicator of demand.

Software-Driven Margin Expansion

Gross margins have improved from 53.5% in 2024Q1 to 57.7% in 2026Q2, a structural shift likely reflecting the growing mix of high-margin recurring software revenue from Red Hat and core software offerings.

The sustained upward trend in gross margins, despite cyclical hardware volatility, suggests a successful portfolio pivot toward software. This mix shift is fundamental to the company's re-rating thesis, as it lifts the overall profitability profile closer to pure-play software peers. The challenge lies in maintaining this mix shift while navigating the consulting segment's lower-margin, labor-intensive cost base.

Operating Leverage Tested by Investment

While gross profit grew from $7.7B in 2024Q1 to $9.9B in 2026Q2, SG&A expenses expanded from $4.4B to $5.0B, indicating that incremental revenue is not translating fully to operating income due to investments in go-to-market and AI initiatives.

The data suggests that operating leverage is currently muted as the company invests to drive its AI and hybrid cloud transformation. For example, the operating margin recovery from 10.8% in 2024Q1 to 15.2% in 2026Q2 lags the gross profit growth, pointing to persistent investment in sales, marketing, and R&D. This implies that margin expansion may be slower than gross margin improvement alone would suggest.

Earnings Volatility from Non-Operational Items

Reported net income and EPS have been highly volatile, with swings from a $330M loss in 2024Q3 to a $5.6B profit in 2025Q4, heavily influenced by non-operational items such as pension mark-to-market adjustments and restructuring charges.

The extreme quarterly volatility in EPS, ranging from -$0.36 to $5.88, indicates that GAAP earnings quality is poor for quarterly analysis. Analysts should focus on operating income and free cash flow as more reliable indicators of core business performance. The significant positive EPS growth in quarters like 2024Q1 (70.3%) and 2025Q1 (-34.9%) often reflects these non-cash items rather than operational momentum.

Structural Growth Ceiling May Persist

Despite the recent beat-and-raise quarter, IBM's core revenue growth has been essentially flat over a multi-year period when adjusting for the Kyndryl spin-off, raising questions about the sustainability of the current AI-driven optimism.

A critical challenge to the narrative is that IBM's top-line has struggled to generate consistent, organic growth above low single digits, as evidenced by the 10-quarter trend where growth frequently dips below 2%. The reliance on cyclical infrastructure refreshes and the competitive nature of the consulting market suggest that the

IBM — Frequently Asked Questions

Quick answers to the most common questions about buying IBM stock.

What was International Business Machines Corporation's (IBM) revenue in 2025?

For fiscal year 2025, International Business Machines Corporation (IBM) reported total revenue of $67.54B. This represents a 8.0% decline compared to $73.42B in 1996.

Is International Business Machines Corporation (IBM) profitable?

International Business Machines Corporation (IBM) is profitable, generating $10.59B in net income for the fiscal year ending 2025 with a net profit margin of 15.7%.

What is International Business Machines Corporation's operating profit margin?

International Business Machines Corporation (IBM) reported an operating income of $12.49B, resulting in an operating profit margin of 18.5%. This margin reflects the operational efficiency of the business before interest and taxes.

What is International Business Machines Corporation's gross profit and gross margin?

International Business Machines Corporation (IBM) generated $39.30B in gross profit for the year, representing a gross profit margin of 58.2%. This demonstrates the company's core pricing power and production efficiency.