launch<\/a> of the new Z17 machines. The debut of revised big iron helped IBM\u2019s infrastructure revenue to grow 15 percent year-over-year. AI is also partly responsible for that growth, because as Krishna pointed out, storage is a key part of AI infrastructure and IBM is therefore selling plenty of it.<\/p>\nThe CEO said IBM\u2019s infrastructure business will benefit more from enthusiasm for AI than the company\u2019s public cloud.<\/p>\n
Asked if the Big Blue cloud can achieve the same kind of growth reported by other cloud operators who serve AI workloads, Krishna pointed out that IBM partners with hyperscalers.<\/p>\n
\u201cA thing that we haven’t talked about, but it’s certainly no secret, for example, we are one of CoreWeave’s large clients. We also tend to use a lot of infrastructure at AWS, at Azure as well as at GCP,\u201d he said. \u201cWe [have] got a huge opportunity to do both consulting projects as well as deploy our software on those infrastructures for our clients,\u201d he said.<\/p>\n
Krishna pointed to \u201cone of our very large health insurance clients\u201d that prefers not to use public cloud, \u201cbut they [are] perfectly fine getting a private instance in a cloud and deploying models there, deploying our software stacks there and getting growth. So we tend to do that.\u201d<\/p>\n
\u201cWe also tend to, in some cases, for example, with Grok, we are deploying Grok in people’s own data centers. So that’s a big opportunity. That will show up in revenue for us, both in consulting as well as in software because on top of the Grok infrastructure, we tend to put our software stacks in some instances. So it’s less about us getting an opportunity in our cloud only, but much more that that’s a growth vector that we are able to ride and that helps increase overall growth rate in both software as well as in consulting.\u201d<\/p>\n
That rather suggests the Big Blue cloud won\u2019t need to make bulk GPU buys, or match rival hyperscalers\u2019 enormous capital expenditure on new and improved bit barns.<\/p>\n
Krishna praised Red Hat for growing bookings by \u201cabout 20 percent\u201d and improving revenue by 12 percent, but also noted that growth slowed a little at the software business unit \u2013 even though its AI-enabled products are in demand \u2013 before predicting future revenue will settle at \u201cmid-teens or close to mid-teens growth.\u201d<\/p>\n
CFO James Kavanaugh weighed in by stating \u201cYear-to-date, from a software perspective, we’re growing 8.5 percent overall, approaching nine percent right now. About two points of that growth is coming out from our GenAI book of business.\u201d<\/p>\n
AI is also helping IBM\u2019s consulting business, which returned to growth in the quarter and is already working on 200 projects involving what Big Blue calls \u201cDigital Workers\u201d \u2013 IBM-speak for agentic AI.<\/p>\n
The company predicted constant currency revenue growth of more than five percent for the full FY 2025. Investors didn\u2019t like what they heard, as IBM shares sank from over $288 apiece to $269 in after-hours trading. \u00ae<\/p>\n","protected":false},"excerpt":{"rendered":"If IBM reveals improved profit margins or a fresh round of redundancies, AI may be the reason, because…\n","protected":false},"author":2,"featured_media":98852,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[220,218,219,61,60,80],"class_list":{"0":"post-98851","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-ie","12":"tag-ireland","13":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/98851","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=98851"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/98851\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/98852"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=98851"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=98851"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=98851"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}