In the first quarter of 2025, IBM faced the cancellation of 15 federal contracts, totaling approximately $100 million, due to cost-cutting measures implemented by the Department of Government Efficiency (DOGE). Despite these setbacks, the company reported a 1% increase in revenue, reaching $14.5 billion, and adjusted earnings of $1.60 per share, surpassing analyst expectations. IBM’s software segment demonstrated robust growth, contributing to the company’s resilience. To address investor concerns, IBM provided a second-quarter revenue forecast between $16.40 billion and $16.75 billion, exceeding analyst estimates. The company’s AI Book of Business expanded to over $6 billion, reflecting its commitment to innovation. While the contract cancellations represent less than 1% of IBM’s consulting order backlog, the company remains focused on delivering critical services and maintaining its growth trajectory.
IBM Navigates Federal Contract Cancellations Amidst Strong Q1 Performance
