IBM

International Business Machines Corporation (IBM) is an American information-technology company founded in 1911 as the Computing-Tabulating-Recording Company (CTR) and renamed IBM in 1924. Headquartered in Armonk, New York, it has occupied the centre of enterprise IT for more than a century around mainframes, middleware, IT services, hybrid cloud (Red Hat), artificial intelligence (watsonx), and quantum computing.

History

Descended from Hollerith's punched-card tabulators, CTR was rebranded IBM by Thomas J. Watson Sr. in 1924 and grew into the world's leading supplier of office equipment on the back of US census and social-security contracts. With the IBM 701 (1952) it entered the electronic-computer business; with the System/360 of 1964 it set the de facto standard for mainframes by unifying operating system, peripherals, and applications under a single compatible architecture — a conceptual move whose lineage runs through PC clones and open standards.

In 1969 IBM "unbundled" hardware and software pricing, partly in response to an antitrust case; that decision is generally treated as the founding moment of the independent software industry. The 1981 IBM PC, built around an open architecture and an externally licensed OS (MS-DOS from Microsoft), seeded the Wintel ecosystem and at the same time cost IBM control of the PC platform itself. By the early 1990s IBM was loss-making; Lou Gerstner became CEO in 1993 and steered the company into IT services (Global Services). From the 2000s onwards IBM sold its PC business to Lenovo (2005) and its x86 server business to Lenovo (2014), then acquired Red Hat for US$34 billion in 2019 to pivot toward hybrid cloud. Arvind Krishna became CEO in 2020; the Kyndryl spin-off (2021) of managed infrastructure, the watsonx rollout (2023-2025), and an accelerated quantum roadmap together built the four-pillar model of mainframe + hybrid cloud + AI + quantum.

Products and Services

watsonx, launched in 2023, is the company's AI platform — watsonx.ai, watsonx.data, and watsonx.governance — aimed at enterprise generative AI. By 2025 IBM's cumulative generative-AI book of business had exceeded US$9.5 billion. Red Hat OpenShift was at roughly US$1.5 billion ARR and remains the heart of the hybrid-cloud strategy.

Key Events

• 1969: Hardware-software unbundling, partly in response to the long-running antitrust suit (dropped 1982).
• 1981: IBM PC released. The open architecture admits compatible-machine makers and lets Intel and Microsoft scale to dominance.
• 1997: Deep Blue defeats World Chess Champion Garry Kasparov.
• 2005: PC business sold to Lenovo (US$1.75 bn).
• 2011: Watson beats Ken Jennings and Brad Rutter on Jeopardy!.
• 2014: x86 server business sold to Lenovo (US$2.1 bn).
• July 2019: Acquisition of Red Hat closed at US$34 bn — IBM's largest acquisition ever.
• November 2021: Managed-infrastructure business spun off as Kyndryl.
• 2023: watsonx unveiled; enterprise generative AI strategy formalised.
• 2024: IBM Quantum System Two begins operations; Heron R2 processor (156 qubits). The Granite 3 family of LLMs is released with open weights.
• 2025: Modular quantum roadmap introduces Loon and Kookaburra chips with multi-chip designs; watsonx Code Assistant for Z commercialises COBOL-to-Java translation.

Key Metrics

• Revenue (full year 2024): about US$62.6 bn / Operating margin: ~16%
• Software-segment growth: +9% YoY in Q3 2025 (Automation +15%, Red Hat +13%)
• Quantum: cumulative revenue from quantum offerings since 2017 has crossed US$1 bn
• Employees (end-2024): about 270,000
• Patents: led US patent grants for 29 consecutive years (over 10,000 per year), surrendering the top spot to Samsung in 2022.

Influence and Criticism

That IBM created the PC industry and then promptly lost it became one of the most cited business-school case studies of the 1990s. Equally singular was its recovery from a US$8.1 billion loss in 1993 — when it was widely described as "a dying dinosaur" — through the services pivot. The decision to outsource the operating system for the PC put MS-DOS rights into Microsoft's hands; the late-1980s OS/2 attempt to take them back failed, and matters were effectively settled by Windows 95.

A persistent critical thread, opened by Edwin Black's 2001 book, concerns the use of IBM-subsidiary Dehomag punched-card machinery for German census and Holocaust-related processing between 1933 and the 1940s. IBM has released some contemporary correspondence but has stopped short of an explicit legal or ethical acknowledgement. More recently, after George Floyd's killing in June 2020, Arvind Krishna told the Speaker of the US House that IBM would exit general-purpose facial recognition — the first major IT company to do so.

On AI ethics IBM released its AI Fairness 360 toolkit in 2018 and has positioned itself as a large-enterprise leader on the EU AI Act. Less flatteringly, the company carried out repeated rounds of North American layoffs in 2020-2022, drawing several age-discrimination lawsuits. In 2024, citing geopolitical risk, IBM substantially scaled back its China R&D operations, reportedly cutting about 1,000 staff.