IBM Plunges 13% On AI Threat

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IBM Plunges 13% On AI Threat

Moz Farooque ACCA

Tue, February 24, 2026 at 8:24 PM GMT+9 1 min read

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IBM

-13.15%

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This article first appeared on GuruFocus.

International Business Machines Corporation (NYSE:IBM) plunged 13% in its sharpest one day drop since October 2000 after Anthropic said its Claude Code AI tool could help modernize legacy COBOL systems, spooking investors about IBM’s mainframe stronghold.

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The selloff was brutal. IBM is now down 27% in February, putting it on pace for its worst monthly performance since at least 1968, according to Bloomberg data. The catalyst was Anthropic’s suggestion that AI powered code translation could make it easier for companies to move aging COBOL based systems off traditional mainframes, an area where IBM has long held an edge.

IBM’s Software and Chief Commercial Officer Rob Thomas moved quickly to cool the narrative. In a blog post, he argued that translating COBOL is not the same as true modernization. Translation captures almost none of the actual complexity, he wrote, stressing that architecture, runtime environments, transaction integrity and integration are what really determine enterprise resilience. The code is the starting point, not the destination.

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