Thread regarding IBM layoffs

@q2

Since you say barbarian, talk about Cambridge and are so obsessed with May 1st (because your country of origin doesn't have any worker protections, they treat people so poorly that they need to come over here Ill egal ly and use H 1 B s c a m s to stay in 'barbaric US where we celebrate Labor Day on Sept 1sr)...

we know who we are.

Ungrateful.

@ph

Oh, no!

Barbarian is an English deviation, it's barbaric in old English, the word barbaros in Greek is its origin, also used in Latin as barbaricus.

You are not respecting the super original origin of the word... not nice!

But let's stick to May 1 as the only right original thing ever.

@pk

The person that posted probably doesn't even know that even the city of Cambridge wasn't called Cambridge originally, but Grantebrycge, and probably doesn't even know that the river is called Cambridge because of the city and not the city because of the river.

So, yeah, things change in history quite a lot. But hey, all this person wanted to do is called American mean names.

The term barbaric comes originally from the Greek, simply to describe all non-Greek speakers, such as the Egyptians and Persians, and after the Greco-Persian wars, the term took on a more negative significance.

Oh, wait, so things have changed, moved, shifted, changed meaning across history?!

Who knew.................

@ph , @mv

did you know it takes one to know one (Barbarians, of course).

Did you know there's a Cambridge in Ontario, Canada too ?

And then there are places called Cambridge in Idaho, Illinois, Maryland, Minnesota, New York, Ohio, and Nebraska.

Take your pick ! LOL.

@pg

No, I was pretty focused on calling Americans barbarians. Here's another one:

You Americans are barbarians. You don't even know that Cambridge is in England.

(not Massachusetts)

@pf

How nice, we are now going to offend every single country (and/or group of people) that doesn't celebrate things (for their own reasons) on the day you think it's right, so that it makes you happy. You know, like Christmas, New Year, Easter, and so it goes and it goes...

Following your logic, you just called a bunch of countries barbaric, not just the US, because the US is not the only country that doesn't celebrate or care about Labor Day the way you think it's 'appropriate'.

Got it. You have a nice day.

@pd

In other words, May 1, International Workers' Day, is the original Labor Day.

Review your logic. Have a lovely September 1.

@mv

U.S. and Canada chose September because the May 1st holiday was politicized and taken over by radicals, so cia list and ma rx ists.

President Cleveland intentionally moved the holiday to September in 1894 to distance the official recognition of workers from the r a d I c a l element elements mentioned above. Canada also celebrates its Labour Day in September.

Canada, Australia, New Zealand, Japan, The Bahamas, Trinidad and Tobago don't do so either. The UK doesn't call it officially Labor Day.

Know your facts. Have a lovely Labor Day.

You Americans are barbarians. You don't even know that Labor Day is May 1.

@k5

Time to tax the outgoing remittances not only to India, but all other countries too - charge them a minimum of 10% tax on every remittance and increase it by 2% every year. Eventually the crooks will not come here. Do the same for Foreign aid from the USA.

@k3

Folks, think about it, ONLY from remittances, the US contributes to 1% of I n d I a 's G D P.

Just from a single source, now, if we combine other sources, the impact is huge. What does Mo di do? He comes to the US, pretends to be friends with Pres T and then turns around and...

Can you trust?

@k3

Obviously, I used AI for my previous post.

"The U.S. has the largest Indian diaspora, with a large population of highly-skilled Indian professionals in lucrative sectors like IT and healthcare, who regularly send money home to support their families or for investments, as noted by Business Standard."

The highly skilled is AI stuff, not mine.

@jb

Mo di is playing an "in te rest ing ga me":

Remittances from the U.S. to India represent a significant portion of India's Gross Domestic Product (GDP).

In 2024, India's overall GDP was estimated at $3.799 trillion. Remittances to India totaled $129.1 billion, accounting for 3.3% of the country's GDP.

Remittances from the U.S. specifically represent $32 billion, approximately 0.84% of India's GDP.

Remittances play an important role in India's economy, boosting foreign exchange reserves and providing a stable source of income for many households.

Indians in the U.S. are the single largest source of remittances to India, sending an estimated $32 billion in 2023-2024, according to a Reserve Bank of India (RBI) survey released in March 2024. This figure represents a significant portion of the total remittances India received globally, with the US being the largest contributor to India's total remittances.

Here's a breakdown:

Total Remittances to India:
.
India is the world's largest recipient of remittances, with the total amount sent by overseas Indians reaching a record $135 billion in the fiscal year 2024-2025, according to a Reserve Bank of India (RBI) report.

U.S. Contribution:
.
The U.S. consistently accounts for a substantial part of these remittances, with a recent estimate showing it as the source of approximately $32 billion in 2023-2024, which is roughly 28% of India's total.

Why the U.S. is a Major Source:
.
The U.S. has the largest Indian diaspora, with a large population of highly-skilled Indian professionals in lucrative sectors like IT and healthcare, who regularly send money home to support their families or for investments, as noted by Business Standard.
Impact on the Indian Economy:
.
These remittances are vital for India's economy, providing a stable source of foreign exchange that supports families and contributes significantly to India's gross domestic product.

https://en.wikipedia.org/wiki/Remittances_to_India

Importance of remittances for India:

Significant Source of Income: Remittances contribute significantly to household incomes, particularly in rural areas, according to IREED Academy.

Boosts Consumption and Investment: The increased purchasing power resulting from remittances stimulates various domestic industries, from consumer goods to real estate, according to IREED Academy.

Enhances Foreign Exchange Reserves: Remittances bolster India's foreign exchange reserves, providing a buffer against external shocks and helping to stabilize the rupee.

Fosters Economic Stability and Resilience: Remittances provide a stable source of foreign currency, particularly during times of economic uncertainty, according to Vision IAS.

[Complete article text from post: @jb+1k3vjayzj quoted below].

India and China are partners, not rivals, Modi and Xi say --

By: Laurie Chen and Mei Mei Chu
August 31, 2025 11:27 AM CDT | Updated 1 hour ago

• Xi, Modi discuss expanding trade and investment
• Modi says atmosphere of 'peace and stability' created on disputed Himalayan border
• Meeting between Asian rivals comes five days after punishing US tariffs on India take effect
• Xi, Modi seek to present united front against Western pressure

TIANJIN, China, Aug 31 (Reuters) - India and China are development partners, not rivals, Prime Minister Narendra Modi and Chinese President Xi Jinping agreed on Sunday, as they discussed ways to improve trade ties amid global tariff uncertainty.

Modi is in China for the first time in seven years to attend a two-day meeting of the Shanghai Cooperation Organisation regional security bloc, along with Russian President Vladimir Putin and leaders from Iran, Pakistan and four Central Asian states in a show of Global South solidarity.

Analysts say Xi and Modi are seeking to align against pressure from the West, days after U.S. President Donald Trump imposed a punitive total of 50% tariff on Indian goods, partly in response to New Delhi's purchase of Russian oil.

Trump's moves hurt decades of carefully cultivated U.S. ties with New Delhi, which Washington had hoped would act as a regional counterweight to Beijing.

Modi told Xi his country was committed to improving ties with China and discussed reducing India's burgeoning bilateral trade deficit of nearly $99.2 billion, while emphasising the need to maintain peace and stability at their disputed border after a clash in 2020 triggered a five-year military standoff.

"We are committed to progressing our relations based on mutual respect, trust and sensitivities," Modi said during the meeting on the sidelines of the summit, according to a video posted on his official X account.

He said an atmosphere of "peace and stability" has been created on their disputed Himalayan border and that cooperation between the two nations was linked to the interests of 2.8 billion people of the world's two most populous countries.

The nuclear-armed Asian neighbours share a 3,800 km (2,400 miles) border that is poorly demarcated and has been disputed since the 1950s.

Xi said that China and India are each other's development opportunities rather than threats, Chinese state news agency Xinhua reported.
"We must ... not let the border issue define the overall China-India relationship," Xinhua reported Xi as saying.

China-India ties could be "stable and far-reaching" if both sides focus on viewing each other as partners instead of rivals, Xi added.
Ties between the nations were ruptured by the 2020 clash, in which 20 Indian and four Chinese soldiers died in hand-to-hand combat, following which the Himalayan border was heavily militarised by both sides.

Indian Foreign Secretary Vikram Misri told reporters later in the day in that the border situation had evolved over the course of last year, following a patrolling agreement in October. "The situation at the border is moving towards normalisation," he said.

To a question on the U.S. tariffs, he said that Modi and Xi discussed the international "economic situation" and the challenges it created.

"They tried to ... see how to leverage that for building greater understanding between themselves and how to ... take forward the economic and commercial relationship between India and China," he said.

The leaders also discussed expanding common ground on bilateral, regional, and global issues, and challenges like terrorism and fair trade in multilateral platforms, a statement from the Indian foreign ministry said.

DIRECT FLIGHTS, TRADE CURBS

Both leaders had a breakthrough meeting in Russia last year after reaching a border patrol agreement, setting off a tentative thaw in ties that has accelerated in recent weeks as New Delhi seeks to hedge against renewed tariff threats from Washington.

Direct flights between both nations, which have been suspended since 2020, are being resumed, Modi added, without providing a timeframe.
China had agreed to lift export curbs on rare earths, fertilisers and tunnel boring machines this month during a key visit to India by China's Foreign Minister Wang Yi.

China opposes Washington's steep tariffs on India and will "firmly stand with India," Chinese Ambassador to India Xu Feihong said this month.
In recent months, China has allowed Indian pilgrims to visit Hindu and Buddhist sites in Tibet, and both countries have lifted reciprocal tourist visa restrictions.

"I see the meeting as a step in the direction of incremental improvement. The readouts indicate a lot of mixed political signalling ... But there's also a sense of the need to stabilise the relationship in the context of broader geopolitical currents," said Manoj Kewalramani, a Sino-Indian relations expert at the Takshashila Institution think tank in Bengaluru.

Other long-term irritants remain in the relationship, too.

China is India's largest bilateral trade partner, but the long-running trade deficit - a persistent source of frustration for Indian officials - reached a record $99.2 billion this year.

Meanwhile, a planned Chinese mega-dam in Tibet has sparked fears of mass water diversion that could reduce water flows on the major Brahmaputra River by up to 85% in the dry season, according to Indian government estimates.

India also hosts the Dalai Lama, the exiled Tibetan Buddhist spiritual leader whom Beijing views as a dangerous separatist influence. India's arch-rival Pakistan also benefits from staunch Chinese economic, diplomatic and military support.

@fb Who can argue with this analysis? I would caution that the writer sees the glass as 1/2 empty vs 1/2 full so they may be getting ahead of their skis, BUT he/she raises some very very legitimate points. With that said here are a few thoughts on their analysis.

1. Can we argue that IBM has restructured SW group to a “buy” innovation vs develop innovation strategy? That new strategy embraces a worldwide distribution model to make money. NOTE you need innovative products to sell, and you need a worldwide team to do the selling. IBM seems to have found success for both in the new strategy via leveraging consulting as the sellers. Can we argue about the purchase price of innovative products? Of course we can, but so far even a higher price seems to be paying off as even the article says IBM’s SW group is executing.
2. Can we also argue that Infrastructure is in the process of restructuring around an “enterprise” only focus with mainframe being the focus? NOTE this strategy relies on an innovative chip design tool sets which IBM possesses in spades. Everything else seems to be in the process of being partnered out or moved to “cloud only” offerings (see manufacturing in Mexico, and PVS being emphasized). NOTE if this strategy is being pursued, then it’s logical to assume “Consulting” is being engaged when it comes to enterprise selling as they have face to face time with the “enterprise” customers and they need innovative “value add products to sell. Mainframe hybrid cloud products seem to be on this glide path.
3. So now we come to the problem child. Consulting. Please note Consulting is the big gorilla within IBM at 160k headcount. Consulting has pursued a dual restructuring strategy within IBM with phase one being replacing high cost labor with lower cost offshore labor. This strategy doesn’t drop headcount, but just moves it. That first strategy has been quite successful as offshoring has goosed IBM’s bottom line profits and allowed IBM to raise FCF for the past 3-4 years. The offshoring strategy has now reached the law of diminishing returns as there are not enough heads remaining in the high cost labor pool to generate significant savings via replacement. IBM is now being forced to ramp the second strategy which is to use AI to generate cost savings (replace repetitive tasks with automation (eg coding, admin, help desk, HR, etc etc). This second strategy is just ramping, so YES I agree with the articles premise that AI isn’t generating revenue growth, but it certainly is starting down the path of generating cost savings, so let’s see where that lands before we throw the baby out with the bath water. I would speculate that Consulting has to demonstrate “cost savings” with their internal AI offerings before they can go sell them to their enterprise customers and start generating revenue growth. So while I heartily agree with the writer of the article that AI isn’t generating revenue growth, I would say it’s still early in the game for AI. I fully expect Consulting over the next 6 months to implement their new AI restructuring/offerings and the article writer has just been premature in their expectations. We’ll know if this is working by watch the headcount numbers coming out at the end of 2025. If they drop significantly, especially within Consulting for repetitive tasks then we know AI is working.

[Complete text, including links to embedded charts, of first Seeking Alpha article that's referenced in OP's post quoted below].

IBM: AI Reality Remains Disappointing --

By: Stone Fox Capital
Aug. 26, 2025 1:03 PM ET

Summary

• International Business Machines Corporation's AI business is mostly tied to consulting, which isn't growing, limiting real AI-driven revenue acceleration.
• Despite AI hype, organic growth remains weak at just 2-3%, with software as the only segment showing modest improvement.
• IBM stock's valuation is stretched, trading at a 20x forward P/E, far above its historical 10-15x range, with no fundamental growth to justify it.
• Investors should continue to Sell IBM, as the recent rally is unsupported by meaningful AI-driven growth or improved financial performance.

International Business Machines Corporation (NYSE:IBM) has finally started reflecting some of the reality regarding the limited AI business. The tech stock has crashed following Q2 earnings that beat analyst estimates. My investment thesis remains ultra Bearish on the stock, even down $50+ from the highs to around $240.

https://static.seekingalpha.com/uploads/2025/8/26/saupload_IBMd120631705i_thumb1.png

Mixed AI Business

About a month ago, IBM reported what the market thought was a generally solid Q2 '25 report. The tech company beat estimates and grew revenues by a solid 7.6%, but IBM opened much lower the next trading day and is down another $20 in the following month.

On the Q2 '25 earnings call, CEO Arvind Krishna highlighted what appears a booming AI business as follows:

What differentiates IBM is the breadth of our AI offerings with an innovative technology stack and consulting business at scale and our client zero lens. Our GenAI book of business now stands at over $7.5 billion inception-to-date with momentum accelerating quarter-over-quarter.

In the prior quarter, IBM announced a $6 billion gen AI business with $1 billion in additional bookings for the March quarter, so the Q2 amount was an acceleration to $1.5 billion in the quarter. The tech company hit $2 billion in Q4 AI bookings in another sign the quarterly amounts are lumpy.

The issue in prior quarters is that AI bookings are far more attached to consulting than software where the business can quickly ramp. Even worse, the CFO latter seemed to suggest the boost in gen AI consulting bookings was potentially pressuring non-AI business as follows (emphasis added):

Consulting revenue was flat, stabilizing in the first half, and heading into the second half, our backlog remains healthy, up 4% over last year despite the challenging pricing environment. In the quarter, Intelligent Operations revenue grew 2% while Strategy and Technology declined by 2%. The environment remains dynamic with clients prioritizing cost-efficient, high-impact technology investments, driving good revenue growth in areas like business application transformation, AI operations and cloud platform engineering and leading to momentum in our Consulting generative AI book of business at over $1 billion in the quarter.

At the very least, CFO James Kavanaugh confirmed $1.0 billion of the $1.5 billion in gen AI bookings for Q2 was tied to consulting and this business didn't grow in the quarter. In the March quarter, management guided to 80% of bookings in the past split to consulting suggesting ~$6 billion of the total gen AI bookings now are tied to consulting, a business not growing and with only 4% total bookings growth.

What the market possibly finally caught up to is that IBM discusses big AI bookings growth, but the company only guided to around 5% sales growth in Q3 with a couple of big hitches on organic growth as follows:

At current foreign exchange rates, currency is expected to be about a 1.5 point tailwind to growth for the year.
The HashiCorp acquisition added ~1 point boost to revenue with a $600 million revenue base from 2024.

In essence, the big AI boost is only leading to organic growth in the 2% to 3% range. The software segment is the only one with solid growth, but a 3-year chart doesn't show any real signs of AI underpinning strong growth.

https://static.seekingalpha.com/uploads/2025/8/25/234751-17561519810825837.png

Misplaced Gains

The stock soared from $125 back in early 2023 to a high of $296 recently on the AI story. The actual results show no signs of AI boosting growth.

The consensus analyst estimates forecast a 2026 EPS target of $11.85. The forward P/E ratio has only dipped to 20x versus the prior normal range at 10x to 15x forward earnings. As documented above, IBM hasn't altered the growth rates due to AI to warrant the higher P/E multiple.

https://static.seekingalpha.com/uploads/2025/8/26/saupload_900ef4d9275c45f1e446e00743921d23.png

IBM forecasts free cash flow generation up at $13.5+ billion. The amount is flat from $13.5 billion forecasts when the year started.

Though, IBM forecasts growing free cash flow from $12.7 billion last year with the amount difficult to parse how much is related to the addition of the HashiCrop business closed in February and actual organic growth. The tech company spent $6.4 billion worth of cash on the deal, already spending nearly 50% of the cash generation by the business on one acquisition.

If the stock were to trade back at prior forward P/E multiples, the $11.85 EPS target for 2026 would produce a stock price of $118.50 to $177.75. IBM would have at least $62 downside to fall back into the normal valuation range.

Unless IBM alters the scenario of what appears consulting revenue replacing prior consulting engagement for limited net benefits, the stock is heading back to the prior range. The company just announced a collaboration with Advanced Micro Devices (AMD) to work on the future of computing by merging AI accelerators and quantum computers.

The tech company has formed tons of partnerships in the past, but it hasn't led to much growth.

Takeaway

The key investor takeaway is that IBM doesn't have the AI growth to warrant much of the rally over the past year. Investors should continue to Sell the stock, even after the $50+ dip in the last few months.

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@aa

I think you have to ask yourself what these companies provide to the world.
Microsoft provides plenty of good things... META? Facebook, Instagram, WhatsApp!?!?!

If Microsoft were to totally disappear, the world would be in trouble. But if META disappears, nobody is going to care. They provide services that are absolutely useless.

Now take IBM, if IBM and all their deployed hardware/software would disappear in a flash, the world would totally stop working. You could not pay anything with your credit card, you could not withdraw money from the bank, the whole financial system would crash because the Federal Reserve Bank would not be working, you could not book an airline ticket, not file a claim with your insurance, and if you are planning to buy anything from most retailers, forget it as their systems would be dead.

So, IBM may be struggling because we have d-mb Executives, but it will still be here in 50 years from now. I will be dead by then so I don't really care what comes after that!

@ab

Sam Altman said it is a bubble (and he has other motives to say it too): https://www.cnbc.com/2025/08/18/openai-sam-altman-warns-ai-market-is-in-a-bubble.html

NVIDIA not selling that much (which is funny, because who would have thought that everyone would go for chips like going to the supermarket? they are measuring the wrong things): https://www.pbs.org/newshour/economy/nvidias-latest-quarter-shows-signs-of-ai-chip-sales-slump-amid-concerns-of-tech-bubble

Then this: "The AI bubble and a potential stock market crash"

https://theweek.com/business/markets/the-ai-bubble-and-a-potential-stock-market-crash

Will the bubble burst?
It's too early to call a peak in the US stock market, "but the signs of one are starting to appear", said UnHerd. Share prices in the data mining and spyware firm Palantir fell by 10% last week, while AI chip maker Nvidia fell more than 3%, and other AI-linked stocks such as Arm, Oracle and AMD also fell.

Is it all doom and gloom for investors?
Not necessarily. If comparisons to the dot-com bubble are apt, there are likely to be some big losers – and some very big winners. Although many companies went under during the dot-com bubble, many companies survived and went on to become market leaders – most notably, e-commerce giant Amazon.

My take: What's happening is, they created the hype (they is media, etc) and now they are covering their b utt s talking about the burst of a bubble they themselves created. So they create fake and then they cover their bottoms. Secondly, yes, we will have winners and losers or more like survivors or not. IBM is in the not list. AK knows it, and that's why is trying to pivot to some other bubble, like Quantum-nothing burger.

The article that initiated this thread @OP is correct, IBM has no credible AI story, not because of their capable workers, but because management is useless, and I'm not being cute so that people posting here will like me, I mean it.

The sooner IBM realizes you will never win with the management they have, which is a piece of Mum bai cheap flee market type of business "quality", the sooner a solution may be found. Otherwise, IBM will not last beyond 2026.

What IBM needs is a write-up that makes apparent the true power of the IBM AI. Someone tell that co-k su-ka Rob Thomas to get off his knees and start writing!

@ae

You are correct, it's actually 10 IQ apiece, but they inflated it to 30, just like the chicken st. ock pr ice.

They called K rrap anno and said, make it go from 10 to 30, we are going to Zuckie boy to sell our genius because it pays more than the IBM CEO + Gang business, and he did his Excel magic.

Still, Zuckie was not in the mo di at all and he went with the 50 percent parking ta rrif. Zuckie gave them originally the H1B parking spot, but he then took it away. Wasn't thrilled with it, because on top of it all, they were planning to outsource their IQ to 50 neighbors from ii nn dd iii aaaaaaaa.

@az

It's what IBM Consulting is so good about - great PowerPoint presentations but nothing in terms of facts to back up the statements in the slides.

As usual, trying to bulldoze with BullSh-t. Telling lies is what they excel at. It's why Consultants get paid the big bucks.

I don't know... IBM's AI sure looked great in the PowerPoint I saw.

@a9

They are already talking about it on FOX Business, FYI, I watch and read many sources, but these are the ones already asking the question. One person said that it's not the same, because these companies are big and they are the ones doing the investment and they have big pockets. I understood it as, even if it is, there's water in the pool, so won't sink like the '90s bubble.

All I'm saying is that a few outlets already started timidly, here and there, to wonder.

But his argument sounded like he was trying to convince himself that even if yes, don't worry, these companies are not like the Netscapes of the '90s "at all"....

One thing that is bull s... is that the "energy consumption" exaggeration is a bubble. This has ALWAYS been my opinion. Feel free to tell me whether I'm right or wrong in your views (energy).

@a1

What do you all think about META, MS, etc going after what they perceive is "the only 20-30 people in the world that can do AI"?

Does anyone think this AI thing is just another giant bubble like the tech one in 1999-2000 ?

Or the housing bubble that led to the 2007-08 Financial crisis ?

AI is being talked about everywhere
It seems saturated

@a1

AK and his top 5 right-hand geniuses have an IQ of 180, they are profoundly gifted / highest genius, altogether - 30 IQ apiece.

They all went to Zuck, but he said that he doesn't buy 180 in bulk, but per unit. It'a easy to get confused, AK and Gang thought they were in Ii nn dd ii aa. But Zuck wasn't in the Mo di for jokes and Zuck told them that next time they come over to waste his time they'd get a 50% parking space tariff.