IBM forecasts second-quarter revenue above estimates, soothing tariff worries
By Arsheeya Bajwa
(Reuters) -IBM said on Wednesday it expects second-quarter revenue above Wall Street estimates, betting on resilient demand for its software services amid economic uncertainty brought on by U.S. President Donald Trump's tariffs.
Shares of the company were up 3.9% after the bell.
The move marked a break from IBM's long-standing practice of not issuing quarterly forecasts and underscored the company's efforts to bolster investor confidence at a time when trade tensions have rattled global markets.
A significant government contractor, IBM is also under pressure from the U.S. administration and its Department of Government Efficiency's cost-cutting drive, which has already weighed on businesses of companies such as Accenture.
"We've chosen now, in light of the very unprecedented dynamic of uncertainty going on in the market, to give a second-quarter revenue guidance range," IBM Chief Financial Officer James Kavanaugh told Reuters in an interview.
"We felt incumbent upon ourselves to give as much transparency as possible to our investor group."
The company forecast June-quarter revenue between $16.40 billion and $16.75 billion, above analysts' average estimate of $16.33 billion, according to data compiled by LSEG.
IBM also maintained its target of achieving at least a 5% revenue growth on a constant currency basis in 2025.
Kavanaugh said that Washington's efforts to cut back on federal spending had led to stop-work orders or cancellation of roughly 15 contracts.
But the hit to IBM is likely to be small as the U.S. federal business is less than 5% of IBM's annual revenue and within that federal unit, about 60% is consulting, Kavanaugh said.
Consulting revenue in the first quarter fell 2% to $5.1 billion, roughly in line with estimates.
Adjusted profit in the March quarter stood at $1.60 per share, compared to the average estimate of $1.40 per share, helped by growth in the high-margin software segment.
IBM's AI Book of Business — a combination of bookings and actual sales across various products — stood at more than $6 billion inception to date, up about $1 billion from the previous quarter.
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Boston Globe
36 minutes ago
- Boston Globe
The research lost because of Trump's NIH cuts
The NIH has rarely revoked funding once it has been awarded. Out of the tens of thousands of grants overseen by the institution Then Donald Trump was reelected. Advertisement Since his January inauguration, his administration has terminated more than 1,450 grants, withholding more than $750 million in funds; officials have said they are curbing wasteful spending and 'unscientific' research. The Department of Government Efficiency gave the agency 'The decision to terminate certain grants is part of a deliberate effort to ensure taxpayer dollars prioritize high-impact, urgent science,' said Andrew G. Nixon, the director of communications for the Department of Health and Human Services. He did not respond to questions about the terminated grants or how patients may be impacted, but he said, 'Many discontinued projects were duplicative or misaligned with NIH's core mission. NIH remains focused on supporting rigorous biomedical research that delivers real results — not radical ideology.' Advertisement Targeted projects, however, were seeking cures for future pandemics, examining the causes of dementia and trying to prevent HIV transmission. The mass cancellation of grants in response to political policy shifts has no precedent, former and current NIH officials told ProPublica. It threatens the stability of the institution and the scientific enterprise of the nation at large. Hundreds of current and former NIH staffers It has been difficult for scientists and journalists to convey the enormity of what has happened these past few months and what it portends for the years and decades to come. News organizations have chronicled cuts to individual projects and sought to quantify the effects of lost spending on broad fields of study. To gain a deeper understanding of the toll, ProPublica reached out to more than 500 researchers, scientists and investigators whose grants were terminated. More than 150 responded to share their experiences, which reveal consequences that experts say run counter to scientific logic and even common sense. They spoke of the tremendous waste generated by an effort intended to save money — years of government-funded research that may never be published, blood samples in danger of spoiling before they can be analyzed. Advertisement Work to address disparities in health, once considered so critical to medical advancement that it was Researchers catalogued many fears — about the questions they won't get to answer, the cures they will fail to find and the colleagues they will lose to more supportive countries. But most of all, they said they worried about the people who, because of these cuts, will die. Research Frozen The NIH often awards funding in multiyear grants, giving scientists the time and intellectual freedom to pursue their work uninterrupted. They plan experiments, hire staff and make equipment purchases on long timelines. Now, studies can't be completed. Papers can't be published. Years of research may be lost and millions of dollars wasted. After the Supreme Court overturned the constitutional right to abortion, demographer Diana Greene Foster set out to study the outcomes of pregnant patients who showed up in emergency departments. She wanted to know whether state restrictions were causing delays in care. 'This needs to be answered for courts to consider the evidence,' said Foster, a professor at the University of California, San Francisco. 'Every day that goes by, people are potentially at risk.' Less than one year into a five-year NIH grant, she had arrived at some early findings: 'Abortion bans don't stop very many people from getting abortions,' she said. 'Bans actually cause people to have their abortions later in pregnancy.' For those who live in states with bans, she found, second-trimester abortions increased from 8% of procedures to 17%, requiring more complex interventions to end their pregnancies and increasing their risk of complications. Advertisement But before the data could be published, the NIH informed her on March 21 that the grant was terminated. It was no longer in line with agency priorities, a letter stated, specifying that studies on 'gender identity' 'ignore, rather than seriously examine, biological realities.' The termination left Foster confused. 'They are wrong that studying gender minority populations is not important,' she said. 'But my study is not about gender identity. It is relevant to anyone who is pregnant, regardless of how they identify.' Foster had to pause her research while she searched for other funding. 'This was clearly a politically motivated cut,' she said. ProPublica heard from more than 70 researchers who said that they were unable to continue their projects due to the terminations. 'Two and a half years into a three-year grant, and to all of a sudden stop and not fully be able to answer the original questions, it's just a waste.' Ethan Moitra, associate professor at Brown University, who was researching whether brief therapy can improve mental health for LGBTQ+ people. 'We are now scrambling to figure out if there are parts we can continue or salvage.' Julia Marcus, associate professor at Harvard Medical School, who was researching whether HIV prevention medicine can be made available over the counter. 'To build trust between health care providers, health researchers in communities takes decades of work, and scientists have already done the work. Now this is going to be depleted.' Jesus Ramirez-Valles, professor at the University of California, San Francisco, who was examining how HIV impacts the physical and mental health of gay men as they age. Advertisement Patient Studies Interrupted In addition to jeopardizing data, terminating a grant in the middle of an active study may worsen participants' conditions and put them at higher risk of death. A single daily pill can nearly eliminate the risk of contracting HIV — but only when taken as prescribed. Black and Latino men who have sex with men have more than a Working with community clinics across Mississippi, Washington, D.C., and Rhode Island, Brown University professors Amy Nunn and Dr. Philip Chan set out to examine The study provides aggressive case management to help patients navigate the health care system and stay on the treatment, known as pre-exposure prophylaxis or PrEP, which is available in both oral and injectable forms. Workers provide patients with reminders, help them get coverage and even pick up their medicine. In 2023, the researchers received about $3.7 million in NIH funding for five years of work. Their team was just starting to gather data that showed the program's efficacy when the grant was terminated. 'This is science that had really great chances of having a huge impact, and all of a sudden, it's cut off at the knee,' Nunn said. Advertisement Chan told ProPublica that he worries that the patients in their study could be harmed by the cut. 'There's no doubt that some of them are going to not stay on PrEP,' said Chan, 'and that some of them are going to get HIV.' At least 30 researchers told ProPublica that the termination of their grant forced them to end clinical research or a trial abruptly, leaving participants in limbo. 'We cannot assay the blood samples that we have collected and paid participants for. A total waste of the money and resources that went into collecting the data.' Sarah Whitton, professor at the University of Cincinnati, who was identifying risk factors for mental illness and suicidality for young LGBTQ+ women. 'We have also had to quickly scramble to keep the study going unfunded to avoid having to stop the treatment and clinical trial for those already enrolled.' Tiffany Brown, assistant professor at Auburn University, who was developing an eating disorder treatment for LGBTQ+ patients. 'With a clinical trial, if you can't follow participants to the end, you have no information, because the whole point is to see whether there's change from beginning to end.' Katie Biello, professor and chair of epidemiology at Brown University's School of Public Health, who was trying to improve adherence to medication protocols for adolescents with HIV in Brazil. Disparities Disregarded The Trump administration has banned the NIH from funding grants with a perceived connection to 'diversity, equity and inclusion,' alleging that such projects may be discriminatory. Caught up in the wave of terminations is work seeking to understand why some populations — including women and sexual, racial or ethnic minorities — may be more at risk of certain disorders or diseases. Despite preventative vaccines and improved screening, more than 4,000 women die every year from cervical cancer. Black and Hispanic women are more likely than their white peers to be diagnosed, and often at later stages. After more than a decade of studying cancer care disparities, epidemiologist Adana Llanos found that the ZIP code in which a woman received care often plays a pivotal role in how she fares. And in 2023, Llanos and her colleagues were awarded a multiyear NIH grant to further examine inequities, specifically in cervical cancer care and who survives it. Even though their work targets the women most at risk, Llanos said their research, like most health equity research, will increase our understanding of cervical cancer more broadly. 'This work has the potential to improve cancer outcomes for everyone, no matter what you identify as, no matter what your characteristics are,' she said. Last year, her team began to recruit a cohort of 960 women who had been diagnosed with cervical cancer to track their patterns of care and outcomes. But in March, after the researchers had enrolled about 200 participants, the NIH terminated the funding. Llanos paused enrollment. The cancellation felt like a betrayal of her study's participants, she said. Llanos had spent years developing relationships with community groups and cancer patients, gaining their trust so they would feel comfortable sharing their treatment experiences. 'We've made commitments to them,' she said. More than 550 of the terminated grants were focused on health disparities or inequities, attempting to understand why some groups have different health outcomes. 'If you cannot identify groups that are higher risk, it seems like just really bad science. That's sort of the basics of how you try to conquer a disease.' Carl Latkin, professor at Johns Hopkins University's Bloomberg School of Public Health, who was analyzing the comorbidities of people who have HIV and those at risk for getting it. 'Health disparities are just going to get larger, and real folks are going to die.' Marguerita Lightfoot, professor at the Oregon Health & Science University–Portland State University School of Public Health, who was studying the value of guaranteed income and financial mentoring to Black youth. 'It's a major principle of epidemiology to target work towards the people who are being disproportionately affected. Now we're being told that we cannot mention them in our research.' Dr. Matthew Spinelli, assistant professor at the University of California, San Francisco, who was working to prevent sexually transmitted infections with common antibiotics. LGBTQ+ People Targeted One of Trump's first executive orders was a directive In response to a lawsuit, a federal judge issued an injunction barring the administration from Gay, lesbian and bisexual adults are over three times more likely to consider suicide than their heterosexual peers. Few studies have aimed to figure out how to prevent this. Last year, Lauren Forrest, an assistant professor of psychology at the University of Oregon, received a multiyear grant to do so, focusing on LGBTQ+ people who live in rural areas where access to specialized care may be more limited. She was planning to recruit dozens of participants. But on March 21, she received a notification from the NIH that her grant was terminated because it did not 'effectuate' the agency's priorities, citing its connection to 'gender identity.' 'The way they're going about deciding which grants will or won't be terminated, it's not about scientific rigor,' she said. 'It's about literally actively discriminating against health-disparity populations.' Forrest has been forced to reduce the hours of her research staff, and she now risks losing key lab personnel who may have to seek other employment due to the cuts. 'There is no way to recover the lost time, research continuity or training value once disrupted,' she said. She worries most about the deaths that could have been prevented. 'People are going to be harmed because of this,' she said. More than 300 of the grants terminated by the NIH were focused on LGBTQ+ health care. About 40 of those grants were researching ways to prevent suicide in adults and youth. 'We have a paper that's ready to go out that shows lesbian women are almost 3 times as likely to have a stillbirth compared to their heterosexual peers. That's such an avoidable, horrible outcome to happen, and that paper may never be published.' Brittany Charlton, associate professor at Harvard Medical School, who was quantifying obstetrical outcomes for lesbian, gay and bisexual women. 'It is devastating to have state-sanctioned dehumanization and exclusion. I am afraid for what these messages will do to the mental health of youth who are told they don't matter or, for some, that they don't even exist by parts of society.' Dr. Sarah Goff, professor at the University of Massachusetts, Amherst, who was studying how to improve the delivery of mental health care to LGBTQ+ youth. 'I honestly burst into tears. The evidence we would have gained from this work will not exist.' Kirsty Clark, assistant professor at Vanderbilt University, who was finding best practices for preventing suicide in LGBTQ+ preteens. Losing a Generation The grant terminations and subsequent instability have created a lost generation of scientists, dozens of researchers told ProPublica — cutting off an established pipeline at all stages of researchers' careers. Universities are trimming the number of openings in postdoctoral and graduate programs. Young researchers are struggling to find funding to initiate studies or open new laboratories. And some scientists are opting to pursue opportunities abroad. Dr. Lauren Harasymiw was a medical resident in a neonatal intensive care unit when an infant took a turn for the worse. Born at only 23 weeks gestation — the edge of viability — the baby girl experienced a hemorrhage within the ventricles of her brain. 'What does this mean for her?' Harasymiw recalls asking her attending physician. The supervisor didn't know. 'The field of neonatology has made incredible strides over the last decades in helping our babies survive,' Harasymiw said. 'But we've made less progress in protecting their neurodevelopmental outcomes.' If doctors could better assess infants' outcomes after a brain injury, they could target interventions sooner and provide families with better resources. To advance this area of medicine, Harasymiw pursued NIH-funded training to become a pediatric scientist. But in March, the NIH terminated funding for the Pediatric Scientist Development Program, which funded Harasymiw's salary and research, claiming that the program was connected to 'DEI.' 'This is just ripping out the foundation of my career,' Harasymiw said. In a statement about the grant terminations, Nixon, the HHS spokesperson, said that the NIH 'continues to invest robustly in training and career development opportunities that produce measurable contributions to biomedical science and patient care.' However, he added that 'while fostering the next generation of scientists is essential, effective leadership requires clear focus: prioritizing research that is impactful and results-driven over duplicative or low-yield programs.' Dr. Sallie Permar, who runs the program and is chair of pediatrics at Weill Cornell Medicine, was perplexed by the cut; the program seemed to be in line with the administration's focus on combating chronic disease in children. 'That's exactly what we're training these scholars to do,' she said. More than 50 researchers told ProPublica that the funding cuts would harm the next generation of scholars, discouraging them from practicing in the United States. 'We have a generation of researchers that were planning to focus on these questions that are now either scared or don't have funding to continue their training, or both.' Mandi Pratt-Chapman, associate center director for community outreach, engagement and equity at the George Washington Cancer Center, who was identifying best practices for collecting data about LGBTQ+ people at small and rural cancer centers. 'Admissions for graduate school have been downsized to a point where prospective students are giving up on pursuing a Ph.D.' Tigist Tamir, assistant professor at the University of North Carolina at Chapel Hill, who received a career development grant and was studying how oxidative stress is regulated in breast cancer and obesity. 'I already know several researchers on the job search who ended up taking faculty positions in Canada instead of the U.S.' Dr. Benjamin Solomon, instructor of immunology and allergy in the department of pediatrics at Stanford Medical School, who received a career development grant and was examining rare genetic immune diseases in children .
New York Post
an hour ago
- New York Post
White House reviews SpaceX contracts as Trump-Musk feud simmers, sources say
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New York Post
2 hours ago
- New York Post
Trump says weather won't stop dazzling festivities on Army's 250th: ‘Rainy day parade brings good luck'
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