How does IBM (IBM) make money?

IBM (IBM) generates revenue primarily from Software, which accounted for 45% of total revenue in TTM through Q2 2026. The company reported $69.1B in revenue and converted 15.5% of it into net profit, equivalent to roughly $10.7B in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of IBM (IBM)?

IBM (IBM) reported a gross profit margin of 58.4% in TTM through Q2 2026, equivalent to $40.4B in gross profit on $69.1B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of IBM (IBM)?

IBM (IBM) reported an operating profit margin of 17.9% in TTM through Q2 2026, equivalent to $12.3B in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of IBM (IBM)?

IBM (IBM) reported a net profit margin of 15.5% in TTM through Q2 2026, equivalent to $10.7B in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is IBM (IBM) profitable?

Yes. IBM (IBM) reported $10.7B in net income for TTM through Q2 2026, with a net profit margin of 15.5%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does IBM (IBM) invest in research and development?

IBM (IBM) invested $8.75B in research and development during TTM through Q2 2026, roughly 12.7% of total revenue. R&D spending funds the company's future product pipeline and is expensed in full on the income statement rather than capitalised, which makes the operating margin sensitive to how aggressively management chooses to reinvest in innovation.

How much does IBM (IBM) spend on capital expenditures?

IBM (IBM) spent $303M on capital expenditures (CapEx) during TTM through Q2 2026, roughly 0.4% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does IBM (IBM) generate?

IBM (IBM) generated $14.6B in free cash flow during TTM through Q2 2026, a free-cash-flow margin of 21.1%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What are the main business segments of IBM (IBM)?

IBM (IBM) reports revenue across 5 reportable product segments, led by Software at 45% of total revenue in TTM through Q2 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

Where does IBM (IBM) generate most of its revenue?

Americas is the largest geographic market for IBM (IBM), accounting for 49.1% of revenue in the most recent annual filing. The complete regional split — including international markets and any Rest-of-World rollup — is shown in the revenue-by-geography table on this page.

How IBM Makes Money: 2026 Visual Revenue Map

IBM (IBM) Income Statement Flow — TTM through Q2 2026

Calculated from the four most recent reported quarters, ending June 30, 2026 (reported July 23, 2026).

IBM (IBM) Revenue by Product Segment — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for IBM (IBM), TTM through Q2 2026.
Segment	Revenue (USD)	% of total
Software	$31.1B	45%
Consulting	$21.3B	30.8%
Infrastructure Services	$15.9B	23%
Financing	$787M	1.1%
Segment Reconciling Items	$68.1M	0.1%
Total	$69.1B	100%

Software$31.1B
Consulting$21.3B
Infrastructure Services$15.9B
Financing$787M
Segment Reconciling Items$68.1M
Total$69.1B

IBM (IBM) Revenue by Geography — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported regions changed mid-year.

Revenue contribution by geographic region for IBM (IBM), TTM through Q2 2026
Region	Revenue (USD)	% of total
Americas	$34B	49.1%
E M E A	$23.1B	33.4%
Asia Pacific	$12B	17.4%
Total	$69.1B	100%

Americas
E M E A
Asia Pacific
Total

Revenue Breakdown — TTM through Q2 2026

In TTM through Q2 2026, IBM (IBM) reports revenue across 5 reportable product segments; the largest segment was Software at 45%, followed by Consulting (30.8%) and Infrastructure Services (23%). Geographically, Americas accounted for 49.1% of revenue, followed by E M E A (33.4%) and Asia Pacific (17.4%).

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