IBM Reports 9% Revenue Growth in Q3 2025, Raises Full-Year Outlook

November 13, 2025
IBM reported third-quarter 2025 revenue of $16.3 billion, up 9% year-over-year, with strong contributions from software and infrastructure segments. The company raised its full-year outlook for revenue growth and free cash flow.

IBM announced in a press release its third-quarter 2025 financial results, reporting revenue of $16.3 billion, a 9% increase from the previous year. The company exceeded expectations for revenue, profit, and free cash flow, prompting it to raise its full-year outlook for both metrics.

Software revenue rose 10%, while consulting grew 3%. Infrastructure revenue saw the largest increase at 17%. IBM reported a gross profit margin of 57.3% on a GAAP basis, up 1.1 percentage points, and an operating margin of 58.7%, up 1.2 points.

Pre-tax income margin reached 14.9% under GAAP, an increase of 20.2 points, and 18.6% on a non-GAAP basis. Year to date, IBM generated $9.2 billion in net cash from operating activities and $7.2 billion in free cash flow.

CEO Arvind Krishna said the company’s AI business now totals more than $9.5 billion, as clients continue to use its technology to enhance productivity and operational efficiency.

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