IBM beat analyst first-quarter earnings<\/a> estimates on the top and bottom lines, but maintained guidance due to the macro uncertainty.<\/p>\n “Is there going to be an issue around oil as inflation goes up? Will that drive people to spend a bit less? If they spend a bit less, it’s not a direct impact on me, but a lot of consumer companies are my clients, like Walmart<\/a>. If people are buying less at Walmart, they’re going to find a way to control their costs, so then they’ll buy less,” he said.<\/p>\n Krishna noted that despite the Iran conflict, IBM’s Middle East business did well.<\/p>\n The company reported first-quarter revenue of $15.92 billion, beating the $15.62 billion consensus estimate from LSEG. Earnings per share came in at an adjusted $1.91, 10 cents better than expectations. Software beat, with Red Hat growth rebounding to 10%.<\/p>\n Krishna said he is also cautious about growth concerns in Europe.<\/p>\n “That’s the only place where I think there is some squinting because it is also a little bit of jadedness, right? You had the Covid shocks, you had the Ukraine war. So they’ve gone through these shocks a few times, and they actually come out okay. I think this time around is an open question,” Krishna said. <\/p>\n “I don’t think anyone will know the answer for another month or two,” he added.<\/p>\n Mythos<\/p>\n Anthropic<\/a>‘s launch two weeks ago of its powerful new Mythos<\/a> artificial intelligence model that is capable of finding security vulnerabilities at unprecedented speed and volume sent shockwaves throughout tech, but Krishna said others will soon follow.<\/p>\n “Somebody does a thing. It looks magical. It looks wonderful. We think it’s the only thing. Three months later, somebody copies it and actually does it better,” he said.<\/p>\n “I’d be surprised if somebody else hasn’t already done it but hasn’t bothered to claim it,” he added.<\/p>\n IBM shares plunged in April after the AI startup said its Claude Code tool could modernize legacy systems that run Common Business-Oriented Language. COBOL<\/a> is a code system developed in the late 1950s that is regularly used in business data processing.<\/p>\n The release of Mythos triggered a surprise meeting between Treasury Secretary Scott Bessent and Fed Chair Jerome Powell<\/a> with the heads of the top U.S. banks over AI cyber concerns. Bessent and Vice President JD Vance<\/a> held a call with tech CEOs like Anthropic’s Dario Amodei, OpenAI’s Sam Altman, xAI’s Elon Musk and others about the same matter.<\/p>\n “It’s a very big conversation, and there is no question that it can find and exploit vulnerabilities at a rate and pace that has not been seen so far,” Krishna said.<\/p>\n
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