Should Big Blue Break Up? Will IBM Spin Off Its Quantum Division?

IBM’s historic crash forces the question it has been avoiding, what IBM Quantum is actually for. IBM shareholders have had a brutal few weeks, and if you have been following our coverage you saw most of it coming in stages. On 14 July the stock fell just over 25 percent in a single session, the worst day in at least 58 years of trading records and quite possibly the worst since the company’s predecessor listed in 1916, after CEO Arvind Krishna pre-announced second quarter numbers below consensus. Shares that closed at $290.23 the day before, near its recent high, now hover just above $200, with roughly $67 billion of market value gone in a day. Wednesday’s full results confirmed the damage, revenue of $17.16 billion up just 1 percent, guidance cut to 4 to 5 percent constant currency growth, consulting flat, mainframe down 42 percent. The market has stopped believing IBM’s growth story at the multiple it was trading on, and that changes the calculus on everything, including IBM Quantum. IBM common stock in the days around 14 July, drawn as an illustration rather than a data chart. The session took IBM from $290.23 to a close near $217, a…