This Week In Blunders – July 12-18
“Risk comes from not knowing what you're doing.” — Warren Buffett
IBM CEO Arvind Krishna talked up the computer giant’s stock to an all-time high this year, hyping the promise artificial intelligence and quantum computing.
Then its stock plunged 25% on Tuesday after Krishna admitted the promise wasn't paying off. About $70 billion in market value vaporized, and analysts don't expect a quick recovery from this historic wipeout.
Now Big Blue is black and blue.
It was just a few months ago when the company announced:
“CEO Arvind Krishna opens IBM Think 2026 and explains how AI is becoming the defining force in business, what it takes to lead, and how quantum computing is emerging as the next frontier.”
On Tuesday, though, Krishna had this to say in a surprise letter to investors:
“What played out was worse than our expectations …
“We did not adapt and move quickly enough, and numerous large deals failed to close on the timelines we expected, driving the majority of our shortfall.”
IBM said its largest customers put mainframes and consulting projects on hold to fund AI investments, leaving Big Blue on the losing end of the AI spending boom.
IBM spent years feeding the AI monster. Now it’s learned the monster gets hungry. And it won’t be its last meal.
