IBM Reports 7.7% Revenue Growth in Q2 2025, Driven by Software and Infrastructure Segments

International Business Machines Corporation (IBM) reported its financial results for the second quarter and first half of 2025, showcasing a total revenue of $17.0 billion for the quarter, marking a 7.7% increase compared to the same period in 2024. For the first six months, revenue reached $31.5 billion, reflecting a 4.3% year-over-year growth. The company’s net income from continuing operations for the quarter was $2.2 billion, a 19.8% increase, while net income for the first half was $3.2 billion, down 4.6% from the previous year. Earnings per share from continuing operations rose to $2.31 for the quarter, up 17.9%, but decreased to $3.43 for the first half, down 6.0%.

The financial performance was bolstered by significant growth in the Software and Infrastructure segments. Software revenue increased by 9.6% in the second quarter, driven by strong demand in Hybrid Cloud and Automation solutions. Infrastructure revenue surged by 13.6%, attributed to the successful launch of the new IBM Z platform. However, Consulting revenue saw a modest increase of 2.6% in the quarter, reflecting a stabilization in the business amid a dynamic economic environment. Geographically, the Americas and EMEA regions reported revenue growth of 6.1% and 14.6%, respectively, while Asia Pacific experienced a slight increase of 1.1%.

In terms of operational metrics, IBM's gross profit margin improved to 58.8% in the second quarter, up 2.0 percentage points year-over-year, driven by a favorable portfolio mix and productivity initiatives. Total expenses increased by 9.6% in the quarter, primarily due to higher acquisition-related spending and currency effects. The company reported a pre-tax income from continuing operations of $2.6 billion, reflecting a 17.0% increase, with a pre-tax margin of 15.3%.

Strategically, IBM completed several acquisitions in the first half of 2025, including the notable acquisition of HashiCorp, which is expected to enhance its hybrid cloud and AI capabilities. The company’s total assets increased to $148.6 billion, up from $137.2 billion at the end of 2024, largely due to the acquisition-related growth in goodwill and intangible assets. IBM's total debt also rose to $64.2 billion, primarily driven by new debt issuances to support its liquidity and future obligations.

Looking ahead, IBM remains optimistic about its growth trajectory, emphasizing the importance of technology in driving economic growth and competitive advantage. The company plans to continue investing in innovation, particularly in AI and hybrid cloud solutions, while managing its financial flexibility to support ongoing operations and shareholder returns.