International Business Machines Corporation stock research
FY2025 Q2
International Business Machines (IBM) Gross Margin — Quarter Ended Jun 30, 2025
Revenue increased from both prior periods and cost of revenue rose at a slower pace, leading to higher gross profit and margin. Management has confirmed the effectiveness of disclosure controls and no material change in internal control occurred during the quarter.
Gross margin takeaway
Quarter ended Jun 30, 2025 · FY2025 Q2
Revenue increased from both prior periods and cost of revenue rose at a slower pace, leading to higher gross profit and margin. Management has confirmed the effectiveness of disclosure controls and no material change in internal control occurred during the quarter.
- The primary margin driver was revenue growth that exceeded the increase in cost of revenue, enabling gross margin expansion.
- Compared to the previous quarter, revenue and gross profit were higher and gross margin improved. Compared to the same quarter a year earlier, all three metrics were also higher and gross margin was stronger.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
58.8%
Gross profit
$10.0B
Revenue
$17.0B
Cost of revenue
$7.0B
Quarter-over-quarter change
+3.5 pts
Year-over-year change
+2.0 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Sep 30, 2024 | $15.0B | $8.4B | $6.5B | 56.3% |
| Dec 31, 2024 | $17.6B | $10.4B | $7.1B | 59.5% |
| Mar 31, 2025 | $14.5B | $8.0B | $6.5B | 55.2% |
| Jun 30, 2025 | $17.0B | $10.0B | $7.0B | 58.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2025
+3.5 pts
Year-over-year change
Jun 30, 2024
+2.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary margin driver was revenue growth that exceeded the increase in cost of revenue, enabling gross margin expansion.
Compared to the previous quarter, revenue and gross profit were higher and gross margin improved. Compared to the same quarter a year earlier, all three metrics were also higher and gross margin was stronger.
Monitor the trajectory of cost of revenue relative to revenue to assess whether the recent margin improvement can be sustained.