IBM Stock Slides After Cloud Computing Disappointment. Here’s Why I’d Still Buy the Dip[Stocks](https://moneymorning.com/category/article/stocks/) # IBM Stock Slides After Cloud Computing Disappointment. Here’s Why I’d Still Buy the Dip  by Omor IE  October 23, 2025  Share it: **IBM** ( [IBM](https://moneymorning.com/stocks/ibm)) shares have tumbled despite the company posting better-than-expected earnings. Q3 EPS came in at $2.65 and beat analyst estimates of $2.44. Revenue of $16.33 also beat estimates of $16.03, up 9% year-over-year. These numbers point to a strong beat that would’ve also translated into a healthy increase in the stock price. However, this wasn’t the case due to constant currency revenue growth guidance coming in at 5%, 2% slower than the current quarter. [IBM](https://moneymorning.com/stocks/ibm) did counter this by raising its free cash flow guidance to $14 billion. The primary issue for Wall Street is that [IBM](https://moneymorning.com/stocks/ibm)’s Red Hat cloud computing unit is showing signs of slowing growth. It grew 14% year-over-year in Q3, down from 16% in the previous quarter.  ## **Why IBM is still a long-term buy** The stock has more than doubled since 2022 as growth accelerated and the cloud computing division started winning from AI. These wins haven’t translated yet into accelerating double-digit revenue growth, but can in the future. Two weeks ago, [IBM](https://moneymorning.com/stocks/ibm) signed a deal with Antropic to integrate Claude models with its software. It won’t lead to Red Hat’s growth being boosted, but it’s a step in the right direction. Moreover, AI cloud computing isn’t the only feather in [IBM](https://moneymorning.com/stocks/ibm)’s hat. The biggest long-term driver could be quantum computing, something that even the government is now [purportedly interested](https://www.wsj.com/business/entrepreneurship/trump-administration-in-talks-to-take-equity-stakes-in-quantum-computing-firms-60ee5143?gaa_at=eafs&gaa_n=AWEtsqeAMBtsSBPCUmG7ImOOJoKDrLNVV7V9YDlrtcARZvP6MTw-Cu5c1_ku1wjpF5Q%3D&gaa_ts=68fa3a4b&gaa_sig=ScM_Nu2o7qFdfEFmrf3cwsjrZNfhDfK4kChfPmV0aiCzpTv3yCJ41nK2CDrSlUKLEfa5myMOpnz8iQ1HDIKEHw%3D%3D) in taking a direct stake in. IBM has been the needle-mover in quantum computing and is the most likely to succeed, as it has deep pockets and was the pioneer of the industry. I expect the coming quarters to remain positive for [IBM](https://moneymorning.com/stocks/ibm). And in the long run, [IBM](https://moneymorning.com/stocks/ibm)’s expertise with both data centers and quantum computing can make it a hot growth stock if the themes succeed. **Beat the market, without relying on brokers or biased institutions.** Email(Required) Name This field is for validation purposes and should be left unchanged. Subscribe By submitting your email address, you will receive a free subscription to _Money Morning!_ and occasional special offers from us and our affiliates. 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