IBM Plunges 25% on July 14, Erasing $69 Billion in Market Value

According to Barron's, IBM stock plunged 25% on July 14, creating the company's worst single-day decline on record and erasing $69 billion in market value. The stock fell an additional 2.7% on July 15, bringing two-day losses to over $72 billion.

The sell-off followed IBM's second-quarter earnings miss and comments from CEO Arvind Krishna that customers accelerated purchases of memory and servers ahead of expected price increases. Krishna acknowledged the company underestimated the scale of capital spending reallocation, saying it failed to adjust quickly enough. UBS analyst David Vogt lowered IBM's EPS and revenue forecasts but maintained a $236 target price, noting the stock's 18x forward P/E multiple is now reasonable. However, Oppenheimer downgraded the stock to "in line" from "outperform" and withdrew its $350 target, suggesting bullish theses need more time to materialize.