Dive Brief:
- IBM plans to pour $150 billion over the next five years into U.S.-based technology, the company said Monday. The initiative includes $30 billion to fuel mainframe and quantum computing research, development and manufacturing, per the announcement.
- “We have been focused on American jobs and manufacturing since our founding 114 years ago,” IBM Chairman, President and CEO Arvind Krishna said in the announcement. “With this investment and manufacturing commitment we are ensuring that IBM remains the epicenter of the world’s most advanced computing and AI capabilities.”
- IBM kicked off the sales cycle for its z17 mainframe this month. The latest generation of the company’s long-running Z systems product line designed to run AI workloads will be generally available on June 18.
Dive Insight:
IBM’s investment push comes as technology providers grapple with nagging concerns over the impact of U.S. trade policy on IT costs. CIOs are also weighing the immediate effects on discretionary spending.
Sweeping import duties proposed by President Donald Trump on April 2 unsettled markets, raising the specter of supply chain disruptions and economic downturn. In the wake of President Trump’s tariff threats, GPU giant Nvidia touted investment plans of its own, vowing to spend up to $500 billion building Arizona and Texas chip manufacturing plants in partnership with Taiwan Semiconductor Manufacturing Co., Foxconn, Wistron, Amkor and Siliconware Precision Industries.
While the administration put some tariffs on hold and temporarily exempted various electronic components, analysts dialed back 2025 IT spending forecasts.
IBM saw no material change in client purchasing during the first three months of the year, Krishna said last week, during the company’s Q1 2025 earnings call. He did, however, acknowledge that economic uncertainty might lead to a slowdown.
“There are areas of our portfolio that could see greater variability in the event that the macroeconomic environment deteriorates,” said Krishna, pointing to the potential for discretionary cutbacks in customer procurement of consulting services.
IBM’s supply chain is largely insulated from tariffs, given imports represent less than 5% of the company’s spending, according to Krishna. “We are tactically evaluating alternative sources and other strategies to mitigate tariffs,” he added.
The move to onshore tech manufacturing gained momentum during the previous administration via the 2022 CHIPS and Science Act, which injected more than $33 billion into U.S. semiconductor manufacturing.
IBM’s planned investments will bolster plants, including the company’s mainframe manufacturing facilities in Poughkeepsie, New York.
“More than 70% of the entire world’s transactions by value run through the IBM mainframes that are manufactured right here in America,” the company said in the Monday announcement.
IBM spent nearly $2 billion on research and development in Q1 2025 and roughly $7.5 billion during the prior fiscal year. The company reported under $30 billion in total expenses and other income in 2024.
