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International Business Machines Corporation IBM is scheduled to report first-quarter 2025 results on April 23, after the closing bell.
In the to-be-reported quarter, the company is likely to have recorded lower revenues from the Consulting segment owing to the persistence of uncertainty in some end markets stemming from macroeconomic headwinds. However, a strong focus on product innovation and multiple deal wins is a tailwind.
Factors at Play
IBM’s Consulting segment provides strategy and technology and intelligent operations services to help clients tackle their toughest business challenges, from boosting productivity to accelerating growth and driving innovation. Leveraging hybrid cloud and AI technologies from IBM Software, along with strategic partners including AWS, Microsoft, Oracle, SAP, and others across the ecosystem, it brings speed and scale to innovative solutions powered by deep industry and domain expertise.
In the first quarter, IBM extended its collaboration with Juniper Networks to drive productivity in core enterprise workflows. Per the renewed agreement, IBM aims to integrate its watsonx platform with Juniper’s sophisticated AI engine, Mist AI, to address the complexities of managing IT networks and help improve user experiences and lower operational costs. In addition to providing personalized support to each user in real-time, the extended tie-up will free up IT resources and empower end users with instant, accurate resolutions. This is likely to have improved efficiency and help unlock new opportunities to stay ahead in the competitive business landscape in the to-be-reported quarter. The strategic acquisition of Application Software Technology LLC has further bolstered the Consulting segment, particularly enhancing its capabilities in Oracle Cloud Applications and public sector digital transformations.
In the to-be-reported quarter, IBM Consulting launched new AI Integration Services to help businesses transform end-to-end processes using its state-of-the-art agentic AI, that can act, learn, and automate tasks with minimal human input. Unlike early AI efforts that offered limited gains, this approach focuses on building agentic apps with persona-based user experiences, coordinated AI agents, and real-time data integration. The services combine IBM’s deep industry expertise, AI-powered delivery platform Consulting Advantage and Agents Catalyst, and a library of pre-built templates to fast-track adoption. Already in use by clients like a global life sciences firm, these solutions aim to drive real business value by automating workflows and scaling AI with strong governance. These developments are likely to have supported the top line in the Consulting segment.
e&, a UAE state-owned telecommunications company, opted to deploy IBM’s Consulting and Software services to launch a pioneering, end-to-end, multi-model Generative AI governance solution. This initiative integrates IBM's advanced watsonx.governance platform, along with the deep AI implementation expertise of IBM Consulting, to tackle key governance challenges such as compliance, oversight, and ethical risk management. To further tailor the solution to e&’s unique needs, IBM has also deployed its AI-powered delivery platform, IBM Consulting Advantage, which supports persona mapping, market research, and AI integration architecture, while facilitating knowledge transfer to build internal capabilities and ensure sustainable AI governance. Such an increasing customer base is likely to have a positive impact on the company’s upcoming results.
However, the persistence of uncertainty in some end markets stemming from macroeconomic headwinds remains a concern for this segment. Frequent acquisition exposes the company to integration risks.