its ironic that IBM sold off its x86 pc/server to Lenovo and kept their big iron (mainframe) but now everyone is buying up pc/server due to AI boom. Dell's stock have been surging with the rest of AI stocks
I think it made sense on its own terms. They retrenched into the business where they are actually differentiated. It is notable that IBM net margins have been ~15% at best for decades. It's an odd business that is huge and just trucks along without remarkable growth. It is the butt of jokes but also a top 100 company by many measures.
Well, it's odd in that they do this sideways financial performance while also from time to time dropping a state-of-the-art microprocessor, like a real tech giant.
You could also see that it's odd in that most companies from 100 years ago simply don't exist. The perfectly flat trajectory bordering on fade-out is uncommon. The median 100-year-old tech company is Sperry, not IBM.
They just need to wait until nobody is selling or can buy new PCs and are forced to use outdated equipment to use as dumb terminals to access those mainframes.
History shows that DRAM is a brutally cyclical business with boom and bust cycles. It's also heavily capital intensive. You build an expensive fab now, and then demand plummets and you're stuck selling at near cost while carrying enormous fixed assets.
IBM is already not the best at making strategic calls. I can't imagine them being saddled with DRAM business with its repeated busts.
There is graveyard of DRAM companies that never made it.
But strategically they decided against a Hardware play and went for software:
2022- ChatGPT released
2023 - IBM buys Manta Software Inc undisclosed sum
2023 - IBM buys Software AG's StreamSets and webMethods $2.33 billion
2025- IBM buys Hashicorp $6.4 billion
2025 - IBM buys Confluent $11 billion.
https://en.wikipedia.org/wiki/IBM
https://en.wikipedia.org/wiki/HashiCorp