IBM's mainframe sales get mugged by AI hardware panic, stock sheds more than a quarter of its value

IBM says customers spooked by soaring demand for AI infrastructure raided their mainframe budgets to stockpile servers, storage, and memory instead, knocking Big Blue's flagship Z business off course. CEO Krishna cited Q2 financials as 'disappointing' with customers reallocating capital away from mainframe investments toward AI hardware procurement ahead of anticipated price increases.