Can IBM's Focus on the Infrastructure Segment Aid the Stock?

AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA Stocks Can IBM's Focus on the Infrastructure Segment Aid the Stock? January 19, 2026 — 07:15 am EST Written by Supriyo Bose for Zacks-> Over the years, International Business Machines Corporation’s IBM Infrastructure segment has recorded healthy profit growth, backed by a strong focus on product innovation and the growing adoption of the z17 program, as AI use cases have resonated strongly with clients. The Infrastructure segment includes Hybrid Infrastructure and Infrastructure Support services. Higher investments in the business across areas like AI, hybrid cloud and quantum also buoyed segment performance. With a surge in traditional cloud-native workloads and associated applications, along with a rise in generative AI deployment, there is a radical expansion in the number of cloud workloads that enterprises are currently managing. This has resulted in heterogeneous, dynamic and complex infrastructure strategies, leading to a healthy demand for the infrastructure services of IBM. The buyout of HashiCorp has further augmented IBM’s capabilities to assist enterprises in managing complex cloud environments and complex infrastructure. HashiCorp’s tool sets complement IBM Red Hat’s portfolio, bringing additional functionalities for cloud infrastructure management. The Infrastructure segment's profit was $644 million in third-quarter 2025 compared with $422 million in the year-ago quarter, for respective margins of 18.1% and 13.9%.Tech Firms Riding on Hybrid Cloud InfrastructureAmazon.com, Inc. AMZN enjoys a dominant position in the cloud-computing market, particularly in the IaaS space, thanks to Amazon Web Services (“AWS”), which is one of its high-margin-generating businesses. AWS is the world’s most comprehensive and widely adopted on-demand cloud computing platform, serving a large number of business enterprises, government entities and startups. It reportedly offers a wide variety of databases that are purpose-built for different types of applications to enable subscribers to choose the right tool for the job for faster agility at a relatively low cost.Microsoft Corporation MSFT has doubled down on the cloud computing opportunity. Azure’s increased availability in more than 60 announced regions globally has strengthened Microsoft's competitive position in the cloud computing market. Operating via a massive network of global data centers that ensure high availability and reliability for applications, Azure offers seamless access to all services included in the portal once customers subscribe to it. Subscribers can use these services for creating cloud-based resources, such as virtual machines and databases, which can be assembled into running environments used to host workloads and store data.IBM’s Price Performance, Valuation and EstimatesIBM has surged 36% over the past year compared with the industry’s growth of 96.9%.Image Source: Zacks Investment ResearchFrom a valuation standpoint, IBM trades at a forward price-to-sales ratio of 4.05, below the industry tally of 5.02.Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for IBM’s earnings for 2025 has remained stable over the past 60 days.Image Source: Zacks Investment ResearchIBM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. #1 Semiconductor Stock to Buy (Not NVDA) The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow. One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportAmazon.com, Inc. (AMZN) : Free Stock Analysis ReportMicrosoft Corporation (MSFT) : Free Stock Analysis ReportInternational Business Machines Corporation (IBM) : Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Tags StocksInvesting Zacks Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com. More articles by this source-> Stocks mentioned AMZN MSFT IBM More Related Articles This data feed is not available at this time. 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