IBM / Q3 2026

International Business Machines Corporation

Reported: October 21, 2026

Published forecast

2026-10-19T19:29:56.799756+00:00

Opus 5.5 High in Shortcut

Shortcut

2.85

Shortcut normalized EPS

-0.6% vs Street

Off by $0.10 per share

Street

2.87

Street normalized EPS

Frozen October 18 snapshot

Off by $0.08 per share

Real

2.95

Issuer operating non-GAAP diluted EPS

Street win

Reported result · October 21 ↗ · Operating non-GAAP diluted EPS was $2.95; GAAP diluted EPS from continuing operations was $2.31.

USD per diluted IBM common share. Percentages use unrounded forecasts.

Model download

Explore the assumptions and calculations behind the forecast.

Open in Shortcut ↗Download XLSX ↓

Shortcut’s reasoning.

The revenue build gives $16.851bn: Software $7.634bn, Consulting $5.395bn, Infrastructure $3.588bn, Financing $0.189bn and Other $45m.

Segment gross-margin assumptions are 82.6% for Software, 29.8% for Consulting, 55.0% for Infrastructure and 43.0% for Financing. The consolidated gross-profit bridge includes $290m of acquired-intangible amortization and a separate $70m non-amortization residual.

The model estimates operating pre-tax income of $3.203bn and applies a 15% operating tax rate, giving operating net income of $2.723bn on 954m diluted shares.

Operating diluted EPS is 2.853826135076559 versus frozen normalized Street EPS of 2.87. The corporate/other allocation and FX assumptions remain material judgments; the beat probability is separate and never multiplies EPS.

On the record.

Reporting basis: Issuer operating non-GAAP diluted EPS / CapIQ normalized EPS
Forecast completed: 2026-10-19T17:50:38.011661+00:00
Published: 2026-10-19T19:29:56.799756+00:00

Model assumptions and review notes

Segment profit and consolidated operating pre-tax income are separate builds. Their implied corporate/unallocated residual is -$712.58m, less negative than recent -$794m and -$800m. Using those historical gaps would give approximately $2.78 EPS. The model retains its original margins and expenses; this medium allocation tension is unresolved.
The -$70m non-amortization gross-profit residual is a separate judgment. The $290m acquired-intangible amortization is linked into cost and added back consistently; its baseline cost/add-back effects cancel in operating earnings.
The -1.1% FX assumption uses rates quoted in a note rather than a stored series that can be independently recomputed from workbook inputs. It enters EPS. Regional FX allocations match the consolidated assumption today but are separate inputs and can diverge under scenarios.
Web content was retrieved after the cutoff without immutable snapshots. Cited publication dates do not prove the fetched pages were unchanged at the cutoff. Source-limited membership evidence and the experimental probability calibration are not guarantees.
Normalized net-income consensus and EPS consensus imply different share counts and are not verified like-for-like contributor bases. Only normalized EPS against frozen 2.87 is scored.
Historical Consulting profit of $558m in both Q1 2026 and Q1 2025 is confirmed by the original cached issuer release; it is not a copied value to be corrected.
FY financing yield uses a two-point opening/closing receivables average, not a time-weighted average. Negative and sign-changing-base growth percentages have weak economic meaning.
Balance-sheet, geographic, EBITDA and RPO figures include residuals, allocation conventions or static assumptions. Structural reconciliation checks test arithmetic, not the independent accuracy of forecast judgments.
Some publisher text is clipped, the Inputs header alignment and Guidance status styling remain imperfect, and source register order and non-period highlight fills are cosmetic limitations. Complete text and values remain available in the workbook.

Research sources