This is probably the one thing AI short sellers least want to hear or see. IBM shares plunged 25%; even more alarming is the explanation it gave itself. On the earnings call, the CEO essentially said: Q2 results fell short of expectations because customers shifted their IT budgets from software and services to chips and servers. This is the one sentence that AI shorts have been most afraid of hearing over the past six months, because it’s a downstream software giant admitting firsthand that the money really has been moved to hardware.

IBM-2.12%
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