Toward the end of the lightning round of Mad Money on August 24, a caller asked for Jim Cramer’s opinion regarding starting a position in International Business Machines Corporation (NYSE:IBM). He replied:
IBM’s rather, I mean, it’s very tough. I think it’s doing better than people think. It’s all the way down. But I have to tell you, I know that people hate the stock even though I don’t think they should and I got to keep that in mind.
Cramer’s defensive stance on August 24 builds on a thesis he tracked closely through the last few months. During the June 4 episode of Mad Money, when asked if the stock could justify its valuation after jumping roughly 80 points in a week, Cramer advised patience against chasing momentum and noted:
Oh, okay… look, I think you raised a really interesting question. You said it was up, down, up, down. This stock is up about 80 points in like a week. I think we gotta give it a chance. I want it to come down before I can give it my seal of approval. And I like it very much, but it’s up on a spike, and you know, I don’t recommend a parabolic move… It’s hardly ever worked.
By July 9, as the stock experienced sharp pullbacks, his tune shifted to aggressive accumulation. Advising a caller on whether to buy, sell, or hold, he stated:
I want you to buy the stock… of IBM. You buy some now and then, it’s been having these kind of panic fits, just panic attacks, you buy the rest then. I think IBM’s terrific. It’s inexpensive, and Arvind Krishna’s doing a fantastic job.
Hybrid Cloud Growth and Software Resilience
As the technology sector keeps evolving, IBM (NYSE:IBM) has been working to adapt, which can be seen in its second-quarter financial performance. The company reported revenue of $17.2 billion along with non-GAAP earnings per share of $2.93, in line with expectations. While headline figures experienced near-term pressure due to delayed large-deal closures and IBM Z weakness, the software division emerged as a core growth engine, generating $7.8 billion in revenue, a 5% year-over-year increase. Momentum was heavily anchored by Red Hat, which accelerated to 11% growth, and data-related software solutions expanding by double digits, showing strong enterprise demand for hybrid-cloud infrastructure and AI deployment tools.
Hardware Headwinds and Guidance Adjustments
Despite software resilience, IBM faced friction in its infrastructure segment, which saw revenues decline 7% to $3.8 billion, heavily impacted by cyclical lulls in mainframe adoption following prior refresh cycles. With these near-term conversion delays and a softer revenue mix, management adjusted its full-year constant-currency revenue growth outlook to a range of 4% to 5%. This conservative guidance, coupled with a broader market skepticism toward legacy tech names, explains the persistent investor fatigue that Cramer highlighted during the episode.
