HSBC recently announced it conducted the world’s first successful trial of quantum-enabled algorithmic bond trading using IBM’s Heron quantum processors, achieving a significant improvement in trade outcome predictions over traditional computing methods.
This marks a material step forward in proving the real-world usefulness of quantum computing in financial services and highlights IBM’s leadership in developing commercially relevant quantum technologies.
We’ll explore how the validation of quantum computing in finance influences IBM’s investment narrative and future growth prospects.
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Owning IBM today means believing that its hybrid cloud and AI investments will continue to drive durable growth, while new proof points in quantum computing can accelerate its relevance in high-value markets like financial services. The HSBC quantum trading breakthrough underscores IBM’s innovation edge, yet the most pressing near-term catalyst, enterprise cloud migration, remains more impacted by macro spending trends, while prolonged uncertainty or delays in client decision-making are the biggest risks to the business right now. The quantum milestone raises IBM’s profile, but its financial effect is not immediately material here.
Among IBM’s recent announcements, its collaboration with ESPN to deliver AI-powered features for more than 14 million fantasy football players highlights the real-world adoption of its watsonx platform. This speaks directly to the company’s catalyst of driving recurring software revenue through AI and cloud, underlining IBM’s intent to convert innovation into meaningful, ongoing client usage.
Yet, in contrast, investors should be mindful that while quantum and AI offer upside, risks from project slowdowns and spending cuts remain…
Read the full narrative on International Business Machines (it’s free!)
International Business Machines’ outlook anticipates $74.4 billion in revenue and $10.5 billion in earnings by 2028. This scenario is based on a 5.1% annual revenue growth rate and a $4.6 billion increase in earnings from the current $5.9 billion.
Uncover how International Business Machines’ forecasts yield a $281.32 fair value, in line with its current price.
