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.
Institutional Appetite And Bearish Bets
According to Insider Monkey’s database tracking over 1,000 elite hedge funds, institutional interest in International Business Machines Corporation (NYSE:IBM) rose in the second quarter of 2026. A total of 74 hedge funds held a stake in the company during Q2, compared to 59 in the previous quarter. It is worth noting that according to Insider Monkey’s data, while several hedge funds added IBM to their portfolio, some major names also increased their position significantly in the second quarter. AQR Capital Management raised its position in the stock by 43%, Marshall Wace LLP increased it by 492%, and Citadel Investment Group increased it by 107%. Meanwhile, short interest stands at 2.62% of the public float, showing muted bearish positioning even during the “hated stock” market dynamics noted by Cramer.
International Business Machines Corporation (NYSE:IBM) remains a classic battleground stock between cyclical headwinds and structural software strength. As Cramer’s summer-long evolution and assessment suggest, looking past the pervasive market negativity reveals a more resilient fundamental business for investors willing to weather the sentiment.
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