Company Overview
International Business Machines Corp is a US-based technology company listed on the New York Stock Exchange. It provides software, consulting, and infrastructure services to enterprise clients worldwide. The company operates across hybrid cloud, artificial intelligence, and mainframe systems. Its market capitalization is about USD 232 billion.
Analysis of recent data
FundamentalsIBM reported USD figures for 2025 with revenue of 67.54 billion, up 7.62% from the prior year. Net income reached 10.59 billion, reflecting a 15.69% net margin. The company maintained a 58.19% gross margin and a 15.29% operating margin, showing consistent profitability.
Depreciation and amortization totaled 2.28 billion, while capital expenditures were 1.09 billion, indicating moderate reinvestment levels. Cash stood at 13.59 billion against total debt of 61.26 billion, suggesting a leveraged but manageable balance sheet.
Return on equity of 36.87% highlights strong capital efficiency. The trailing P/E of 21.97 and EV/EBITDA of 17.22 suggest investors value IBM’s steady margins and returns. Interest coverage was not provided.
Valuation
DCF / MultiplesAt a share price of 247.68 USD, IBM trades above its base DCF estimate. The DCF fair value range is Bear 137.78 – Base 218.39 – Bull 313.32. This suggests the market is pricing in sustained profitability and stable returns on capital.
With a 21.97 P/E and 36.87% ROE, the valuation reflects confidence in IBM’s ability to maintain its operating margins and cash generation. Investors appear to expect consistent execution rather than rapid expansion.
Conclusion
TakeawayIBM shows strong returns on equity and stable margins. Its balance sheet carries significant debt but remains manageable. The stock price already reflects steady performance expectations. Long-term investors may see gradual value creation through consistent execution.