On January 23^rd, the IBM (IBM) stock price closed the day at $173.94 – the highest closing price, and also an ALH in the same day, in the company’s history of over 100 years.

But why?

Earnings matter

Late yesterday, IBM announced triumphal financial results for the 2023 year, with gross profits up six percent YoY for Q4 and revenues up four percent, both well ahead of market expectations.

Dividends, too, were significantly higher than anticipated, coming in at $3.87 for Q4, as opposed to the $3.78 the markets were expecting. Read a breakdown of the IBM earnings.

The stock price responded accordingly. With the IBM results being released towards the end of the trading day, after-hours trading on the company’s share price rocketed upwards, gaining nearly five percent to peak at 182.34, before closing at 173.94.

The AI payoff

But that’s not all there is to the IBM share price’s spike. In fact, the tech stalwart company has been hard at work to position itself in the AI space – specifically, bringing the power of AI tech into the office and C-suite spaces – for some time.

In May 2023, IBM Consulting announced a Centre of Excellence for generative AI, with over 1000 AI experts ready to implement clients’ business transformation with enterprise-grade AI.

Since then, from best practises to integrating AI work processes in your workforce to smart buildings powered by AI and IoT (internet of things), IBM has been hard at work positioning itself as a thought leader. In fact, the company has written over 100 blogs – including nine since the start of 2024 alone – on AI.

The company’s famous upcoming annual IBM Think conference has also been labelled ‘join us at the forefront of AI for business’.

On the more personal side of the AI spectrum, the company also announced at the start of 2024 that IBM’s new watsonx large speech model, to be launched soon, would “bring generative AI to the phone” with a new, state-of-the-art Large Speech Model (LSM).

And clearly, with investors and asset funds continuing with their obsession over all things AI this year, what IBM is doing is working.

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