UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report: July 18, 2022

(Date of earliest event reported)

INTERNATIONAL BUSINESS MACHINES CORPORATION

(Exact name of registrant as specified in its charter)


New York	1-2360	13-0871985
(State of Incorporation)	(Commission File Number)	(IRS employer Identification No.)

One New Orchard Road

Armonk, New York

10504

(Address of principal executive offices)

(Zip Code)

914-499-1900

(Registrant’s telephone number)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Capital stock, par value $.20 per share	IBM	New York Stock Exchange
		NYSE Chicago
2.625% Notes due 2022	IBM 22A	New York Stock Exchange
1.250% Notes due 2023	IBM 23A	New York Stock Exchange
0.375% Notes due 2023	IBM 23B	New York Stock Exchange
1.125% Notes due 2024	IBM 24A	New York Stock Exchange
2.875% Notes due 2025	IBM 25A	New York Stock Exchange
0.950% Notes due 2025	IBM 25B	New York Stock Exchange
0.875% Notes due 2025	IBM 25C	New York Stock Exchange
0.300% Notes due 2026	IBM 26B	New York Stock Exchange
1.250% Notes due 2027	IBM 27B	New York Stock Exchange
0.300% Notes due 2028	IBM 28B	New York Stock Exchange
1.750% Notes due 2028	IBM 28A	New York Stock Exchange
1.500% Notes due 2029	IBM 29	New York Stock Exchange
0.875% Notes due 2030	IBM 30	New York Stock Exchange
1.750% Notes due 2031	IBM 31	New York Stock Exchange
0.650% Notes due 2032	IBM 32A	New York Stock Exchange
1.250% Notes due 2034	IBM 34	New York Stock Exchange
1.200% Notes due 2040	IBM 40	New York Stock Exchange
7.00% Debentures due 2025	IBM 25	New York Stock Exchange
6.22% Debentures due 2027	IBM 27	New York Stock Exchange
6.50% Debentures due 2028	IBM 28	New York Stock Exchange
7.00% Debentures due 2045	IBM 45	New York Stock Exchange
7.125% Debentures due 2096	IBM 96	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

The registrant’s press release dated July 18, 2022, regarding its financial results for the period ended June 30, 2022, including consolidated financial statements for the period ended June 30, 2022, is Exhibit 99.1 of this Form 8-K.

In an effort to provide investors with additional information regarding the company’s results as determined by generally accepted accounting principles (GAAP), the company has disclosed in the attached press release certain non-GAAP information which management believes provides useful information to investors. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are included in the press release, which is Exhibit 99.1 to this Form 8-K. The rationale for management’s use of non-GAAP measures is included in Exhibit 99.2 to this Form 8-K.

The information in this Item 2.02, including the corresponding Exhibits 99.1 and 99.2, is being furnished with the Commission and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

Item 7.01. Regulation FD Disclosure.

The slides for IBM’s Chairman and Chief Executive Officer Arvind Krishna and Chief Financial Officer Jim Kavanaugh’s second-quarter 2022 earnings presentation on July 18, 2022, are Exhibit 99.3 to this Form 8-K.

The information in this Item 7.01, including the corresponding Exhibit 99.3, is being furnished with the Commission and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

The following exhibits are being furnished as part of this report:


Exhibit No.		Description of Exhibit
99.1		Earnings Release of the Registrant, dated July 18, 2022
99.2		Non-GAAP Financial Information
99.3		Earnings Presentation of the Registrant, dated July 18, 2022

The following exhibit is being filed as part of this report:


Exhibit No.		Description of Exhibit
104		Cover Page Interactive Data File (embedded within the Inline XBRL Document)

IBM’s web site (www.ibm.com) contains a significant amount of information about IBM, including financial and other information for investors (www.ibm.com/investor/). IBM encourages investors to visit its various web sites from time to time, as information is updated and new information is posted.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.


Date: July 18, 2022


	By:	/s/ Robert F. Del Bene
		Robert F. Del Bene
		Vice President and Controller

Exhibit 99.1

IBM RELEASES SECOND QUARTER RESULTS

Growth Across Key Segments Led by Hybrid Cloud Adoption; Solid Cash and Profit Generation

ARMONK, N.Y., July 18, 2022 . . . IBM (NYSE: IBM) today announced second-quarter 2022 earnings results.

“In the quarter we delivered good revenue performance with balanced growth across our geographies, driven by client demand for our hybrid cloud and AI offerings. The IBM team executed our strategy well," said Arvind Krishna, IBM chairman and chief executive officer. "With our first half results, we continue to expect full-year revenue growth at the high end of our mid-single digit model.”

Second-Quarter Highlights

●

Revenue

─

Revenue of $15.5 billion, up 9 percent, up 16 percent at constant currency (about 5 points from sales to Kyndryl)

─

Software revenue up 6 percent, up 12 percent at constant currency (about 7 points from sales to Kyndryl)

─

Consulting revenue up 10 percent, up 18 percent at constant currency

─

Infrastructure revenue up 19 percent, up 25 percent at constant currency (about 7 points from sales to Kyndryl)

─

Hybrid cloud revenue, over the last 12 months, of $21.7 billion, up 16 percent, up 19 percent at constant currency

●

Cash Flow

─

On a consolidated basis, year to date, net cash from operating activities of $4.6 billion; free cash flow of $3.3 billion


	SECOND QUARTER 2022 INCOME STATEMENT SUMMARY
										Pre-tax
					Gross			Pre-tax		Income			Net			Diluted
		Revenue			Profit			Income		Margin			Income			EPS
GAAP from Continuing Operations	$	15.5B		$	8.3B		$	1.7B		11.1	%	$	1.5B		$	1.61
Year/Year		9	%*		6	%		89	%	4.7	Pts		81	%		79	%
Operating (Non-GAAP)				$	8.5B		$	2.5B		16.2	%	$	2.1B		$	2.31
Year/Year					5	%		48	%	4.2	Pts		45	%		43	%

*16% at constant currency

“We are a faster-growing, focused, disciplined company with sound business fundamentals," said James Kavanaugh, IBM senior vice president and chief financial officer. "Our recurring revenue stream and solid cash generation position us well to continue to invest in R&D, acquire new companies, and strengthen our talent in every part of the business, while also returning value to shareholders through our dividend.”

Segment Results for Second Quarter

●	Software (includes Hybrid Platform & Solutions, Transaction Processing)— revenues of $6.2 billion, up 6.4 percent, up 11.6 percent at constant currency (about 7 points from sales to Kyndryl):

- Hybrid Platform & Solutions up 4 percent, up 9 percent at constant currency (about 1.5 points from sales to Kyndryl):

-- Red Hat up 12 percent, up 17 percent at constant currency

-- Automation up 4 percent, up 8 percent at constant currency

-- Data & AI flat, up 4 percent at constant currency

-- Security flat, up 5 percent at constant currency

- Transaction Processing up 12 percent, up 19 percent at constant currency (about 22 points from sales to Kyndryl)

- Software segment hybrid cloud revenue up 14 percent, up 18 percent at constant currency

●	Consulting (includes Business Transformation, Technology Consulting and Application Operations)— revenues of $4.8 billion, up 9.8 percent, up 17.8 percent at constant currency:

- Business Transformation up 9 percent, up 16 percent at constant currency

- Technology Consulting up 14 percent, up 23 percent at constant currency

- Application Operations up 9 percent, up 17 percent at constant currency

- Consulting segment hybrid cloud revenue up 20 percent, up 29 percent at constant currency

●	Infrastructure (includes Hybrid Infrastructure, Infrastructure Support)— revenues of $4.2 billion, up 19.0 percent, up 25.4 percent at constant currency (about 7 points from sales to Kyndryl):

- Hybrid Infrastructure up 34 percent, up 41 percent at constant currency (about 7 points from sales to Kyndryl)

-- IBM z Systems up 69 percent, up 77 percent at constant currency

-- Distributed Infrastructure up 11 percent, up 17 percent at constant currency

- Infrastructure Support down 2 percent, up 5 percent at constant currency (about 8 points from sales to Kyndryl)

- Infrastructure segment hybrid cloud revenue up 24 percent, up 30 percent at constant currency

●	Financing (includes client and commercial financing)— revenues of $0.1 billion, down 29.9 percent, down 26.6 percent at constant currency

Cash Flow and Balance Sheet

On a consolidated basis, in the second quarter, the company generated net cash from operating activities of $1.3 billion or $2.6 billion excluding IBM Financing receivables. IBM’s free cash flow was $2.1 billion. The company returned $1.5 billion to shareholders in dividends in the second quarter.

On a consolidated basis, for the first six months of the year, the company generated net cash from operating activities of $4.6 billion or $4.2 billion excluding IBM Financing receivables. IBM’s free cash flow was $3.3 billion, which includes cash impacts from the company’s structural actions initiated at the end of 2020.

IBM ended the second quarter with $7.8 billion of cash on hand (which includes marketable securities), up $0.2 billion from year-end 2021. Debt, including IBM Financing debt of $12.3 billion, totaled $50.3 billion, down $1.4 billion since the end of 2021.

Full-Year 2022 Expectations

●

Revenue growth: The company continues to expect constant currency revenue growth at the high end of its mid-single digit model. The company also expects an additional 3.5 point contribution from incremental sales to Kyndryl. At mid-July 2022 foreign exchange rates, currency is expected to be about a six-point headwind.

●	Free Cash Flow: The company now expects about $10 billion in consolidated free cash flow.

Forward-Looking and Cautionary Statements

Except for the historical information and discussions contained herein, statements contained in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the company’s current assumptions regarding future business and financial performance. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including, but not limited to, the following: a downturn in economic environment and client spending budgets; a failure of the company’s innovation initiatives; damage to the company’s reputation; risks from investing in growth opportunities; failure of the company’s intellectual property portfolio to prevent competitive offerings and the failure of the company to obtain necessary licenses; the company’s ability to successfully manage acquisitions, alliances and dispositions, including integration challenges, failure to achieve objectives, the assumption of liabilities, and higher debt levels; fluctuations in financial results; impact of local legal, economic, political, health and other conditions; the company’s failure to meet growth and productivity objectives; ineffective internal controls; the company’s use of accounting estimates; impairment of the company’s goodwill or amortizable intangible assets; the company’s ability to attract and retain key employees and its reliance on critical skills; impacts of relationships with critical suppliers; product quality issues; impacts of business with government clients; reliance on third party distribution channels and ecosystems; cybersecurity and data privacy considerations; adverse effects related to climate change and environmental matters, tax matters; legal proceedings and investigatory risks; the company’s pension plans; currency fluctuations and customer financing risks; impact of changes in market liquidity conditions and customer credit risk on receivables; potential failure of the separation of Kyndryl Holdings, Inc. to qualify for tax-free treatment; risk factors related to IBM securities; and other risks, uncertainties and factors discussed in the company’s Form 10-Qs, Form 10-K and in the company’s other filings with the U.S. Securities and Exchange Commission or in materials incorporated therein by reference. Any forward-looking statement in this release speaks only as of the date on which it is made. Except as required by law, the company assumes no obligation to update or revise any forward-looking statements.

Presentation of Information in this Press Release

On November 3, 2021, IBM completed the separation of Kyndryl. Unless otherwise specified, results are presented on a continuing operations basis. All references to revenue impacts from sales to Kyndryl are incremental sales post-separation.

IBM results —

●	adjusting for currency (i.e., at constant currency);

●	presenting operating (non-GAAP) earnings per share amounts and related income statement items;

●	consolidated free cash flow;

●	consolidated cash from operating activities excluding IBM Financing receivables;

The rationale for management’s use of these non-GAAP measures is included in Exhibit 99.2 in the Form 8-K that includes this press release and is being submitted today to the SEC.

Conference Call and Webcast

IBM’s regular quarterly earnings conference call is scheduled to begin at 5:00 p.m. EDT, today. The Webcast may be accessed via a link at https://www.ibm.com/investor/events/earnings-2q22. Presentation charts will be available shortly before the Webcast.

Financial Results Below (certain amounts may not add due to use of rounded numbers; percentages presented are calculated from the underlying whole-dollar amounts).


Contact:	IBM
	Sarah Meron, 347-891-1770
	[email protected]

	Tim Davidson, 914-844-7847
	[email protected]

INTERNATIONAL BUSINESS MACHINES CORPORATION

COMPARATIVE FINANCIAL RESULTS

(Unaudited; Dollars in millions except per share amounts)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021*			2022			2021*
REVENUE
Software	$	6,166		$	5,795		$	11,938		$	10,933
Consulting		4,809			4,378			9,637			8,641
Infrastructure		4,235			3,560			7,453			6,853
Financing		146			209			300			417
Other		180			277			404			561
TOTAL REVENUE		15,535			14,218			29,732			27,405

GROSS PROFIT		8,290			7,852			15,625			14,879

GROSS PROFIT MARGIN
Software		79.2	%		79.7	%		79.0	%		78.8	%
Consulting		24.2	%		27.6	%		24.3	%		27.7	%
Infrastructure		53.8	%		57.1	%		52.4	%		56.7	%
Financing		35.3	%		29.9	%		36.5	%		32.7	%

TOTAL GROSS PROFIT MARGIN		53.4	%		55.2	%		52.6	%		54.3	%

EXPENSE AND OTHER INCOME
S,G&A		4,855			4,849			9,452			9,536
R,D&E		1,673			1,641			3,352			3,257
Intellectual property and custom development income		(176)			(133)			(297)			(278)
Other (income) and expense		(81)			302			166			647
Interest expense		297			281			607			561
TOTAL EXPENSE AND OTHER INCOME		6,568			6,940			13,280			13,724

INCOME/(LOSS) FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES		1,722			912			2,345			1,155
Pre-tax margin		11.1	%		6.4	%		7.9	%		4.2	%
Provision for/(Benefit from) income taxes		257			101			218			(58)
Effective tax rate		14.9	%		11.1	%		9.3	%		(5.0)	%

INCOME FROM CONTINUING OPERATIONS	$	1,465		$	810		$	2,127		$	1,213

DISCONTINUED OPERATIONS
Income/(Loss) from discontinued operations, net of taxes		(73)			515			(2)			1,067

NET INCOME	$	1,392		$	1,325		$	2,125		$	2,280

EARNINGS/(LOSS) PER SHARE OF COMMON STOCK
Assuming Dilution
Continuing Operations	$	1.61		$	0.90		$	2.34		$	1.34
Discontinued Operations	$	(0.08)		$	0.57		$	0.00		$	1.18
TOTAL	$	1.53		$	1.47		$	2.34		$	2.52

Basic
Continuing Operations	$	1.62		$	0.91		$	2.36		$	1.36
Discontinued Operations	$	(0.08)		$	0.57		$	0.00		$	1.19
TOTAL	$	1.54		$	1.48		$	2.36		$	2.55

WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING (M’s)
Assuming Dilution		910.7			904.2			910.0			903.0
Basic		901.5			895.0			900.4			894.3

* Recast to conform with 2022 presentation.

INTERNATIONAL BUSINESS MACHINES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEET

(Unaudited)


	At		At
	June 30,		December 31,
(Dollars in Millions)	2022		2021
ASSETS:
Current Assets:
Cash and cash equivalents	$	7,034	$	6,650
Restricted cash		220		307
Marketable securities		524		600
Notes and accounts receivable - trade, net		5,867		6,754
Short-term financing receivables, net		7,233		8,014
Other accounts receivable, net		909		1,002
Inventories		1,684		1,649
Deferred costs		1,010		1,097
Prepaid expenses and other current assets		3,414		3,466
Total Current Assets		27,896		29,539

Property, plant and equipment, net		5,275		5,694
Operating right-of-use assets, net		2,848		3,222
Long-term financing receivables, net		5,316		5,425
Prepaid pension assets		9,930		9,850
Deferred costs		865		924
Deferred taxes		7,073		7,370
Goodwill		55,039		55,643
Intangibles, net		11,571		12,511
Investments and sundry assets		1,689		1,823
Total Assets	$	127,503	$	132,001

LIABILITIES:
Current Liabilities:
Taxes	$	1,742	$	2,289
Short-term debt		5,981		6,787
Accounts payable		3,707		3,955
Deferred income		12,522		12,518
Operating lease liabilities		884		974
Other liabilities		7,008		7,097
Total Current Liabilities		31,844		33,619

Long-term debt		44,328		44,917
Retirement related obligations		13,118		14,435
Deferred income		3,069		3,577
Operating lease liabilities		2,182		2,462
Other liabilities		13,486		13,996
Total Liabilities		108,026		113,005

EQUITY:
IBM Stockholders’ Equity:
Common stock		57,802		57,319
Retained earnings		153,298		154,209
Treasury stock — at cost		(169,522)		(169,392)
Accumulated other comprehensive income/(loss)		(22,169)		(23,234)
Total IBM Stockholders’ Equity		19,409		18,901

Noncontrolling interests		67		95
Total Equity		19,476		18,996

Total Liabilities and Equity	$	127,503	$	132,001

INTERNATIONAL BUSINESS MACHINES CORPORATION

CASH FLOW ANALYSIS

(Unaudited)


									Trailing Twelve
	Three Months Ended				Six Months Ended				Months Ended
	June 30,				June 30,				June 30,
(Dollars in Millions)	2022		2021		2022		2021		2022
Consolidated Net Cash from Operations per GAAP	$	1,321	$	2,625	$	4,569	$	7,539	$	9,826

Less: change in IBM Financing receivables		(1,264)		900		367		3,763		511
Capital Expenditures, net		(494)		(688)		(871)		(1,217)		(2,035)

Consolidated Free Cash Flow		2,091		1,037		3,331		2,559		7,279

Acquisitions		(260)		(1,747)		(958)		(2,866)		(1,385)
Divestitures		1,207		(10)		1,268		(25)		1,408
Dividends		(1,488)		(1,467)		(2,963)		(2,924)		(5,907)
Non-Financing Debt		(2,934)		(586)		1,740		(2,331)		2,880
Other (includes IBM Financing net receivables and debt)		(1,607)		(335)		(2,197)		(522)		(4,661)

Change in Cash, Cash Equivalents, Restricted Cash and Short-term Marketable Securities*	$	(2,991)	$	(3,108)	$	221	$	(6,110)	$	(387)

* Cash flows are presented on a consolidated basis.

INTERNATIONAL BUSINESS MACHINES CORPORATION

CASH FLOW

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(Dollars in Millions)	2022		2021		2022		2021
Net Income from Operations	$	1,392	$	1,325	$	2,125	$	2,280
Depreciation/Amortization of Intangibles		1,245		1,680		2,501		3,352
Stock-based Compensation		254		243		488		457
Working Capital / Other		(307)		(1,524)		(912)		(2,313)
IBM Financing A/R		(1,264)		900		367		3,763
Net Cash Provided by Operating Activities	$	1,321	$	2,625	$	4,569	$	7,539
Capital Expenditures, net of payments & proceeds		(494)		(688)		(871)		(1,217)
Divestitures, net of cash transferred		1,207		(10)		1,268		(25)
Acquisitions, net of cash acquired		(260)		(1,747)		(958)		(2,866)
Marketable Securities / Other Investments, net		(281)		(227)		(625)		(562)
Net Cash Provided by/(Used in) Investing Activities	$	172	$	(2,671)	$	(1,186)	$	(4,671)
Debt, net of payments & proceeds		(2,514)		(1,500)		434		(5,799)
Dividends		(1,488)		(1,467)		(2,963)		(2,924)
Financing - Other		(195)		(163)		(290)		(190)
Net Cash Provided by/(Used in) Financing Activities	$	(4,197)	$	(3,131)	$	(2,819)	$	(8,914)
Effect of Exchange Rate changes on Cash		(262)		69		(267)		(65)
Net Change in Cash, Cash Equivalents and Restricted Cash*	$	(2,965)	$	(3,108)	$	297	$	(6,110)

* Cash flows are presented on a consolidated basis.

INTERNATIONAL BUSINESS MACHINES CORPORATION

SEGMENT DATA

(Unaudited)


	Three Months Ended June 30, 2022

(Dollars in Millions)	Software			Consulting			Infrastructure			Financing
Revenue	$	6,166		$	4,809		$	4,235		$	146
Pre-tax Income/(Loss) from Continuing Operations	$	1,375		$	343		$	757		$	102
Pre-tax Margin		22.3	%		7.1	%		17.9	%		69.7	%
Change YTY Revenue		6.4	%		9.8	%		19.0	%		(29.9)	%
Change YTY Revenue - constant currency		11.6	%		17.8	%		25.4	%		(26.6)	%


	Three Months Ended June 30, 2021*

(Dollars in Millions)	Software			Consulting			Infrastructure			Financing
Revenue	$	5,795		$	4,378		$	3,560		$	209
Pre-tax Income/(Loss) from Continuing Operations	$	1,059		$	270		$	489		$	131
Pre-tax Margin		18.3	%		6.2	%		13.7	%		63.0	%

* Recast to conform with 2022 presentation.


	Six Months Ended June 30, 2022

(Dollars in Millions)	Software			Consulting			Infrastructure			Financing
Revenue	$	11,938		$	9,637		$	7,453		$	300
Pre-tax Income/(Loss) from Continuing Operations	$	2,509		$	691		$	956		$	186
Pre-tax Margin		21.0	%		7.2	%		12.8	%		62.0	%
Change YTY Revenue		9.2	%		11.5	%		8.8	%		(28.0)	%
Change YTY Revenue - constant currency		13.4	%		17.6	%		13.4	%		(25.5)	%


	Six Months Ended June 30, 2021*

(Dollars in Millions)	Software			Consulting			Infrastructure			Financing
Revenue	$	10,933		$	8,641		$	6,853		$	417
Pre-tax Income/(Loss) from Continuing Operations	$	1,717		$	547		$	780		$	229
Pre-tax Margin		15.7	%		6.3	%		11.4	%		55.0	%

* Recast to conform with 2022 presentation.

INTERNATIONAL BUSINESS MACHINES CORPORATION

U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION

(Unaudited; Dollars in millions except per share amounts)


	Three Months Ended June 30, 2022
	Continuing Operations
				Acquisition-			Retirement-			Tax			Kyndryl-
				Related			Related			Reform			Related			Operating
	GAAP			Adjustments ⁽¹⁾			Adjustments ⁽²⁾			Impacts			Impacts ⁽³⁾			(Non-GAAP)
Gross Profit	$	8,290		$	180		$	—		$	—		$	—		$	8,470
Gross Profit Margin		53.4	%		1.2	pts.		—	pts.		—	pts.		—	pts.		54.5	%
S,G&A	$	4,855		$	(279)		$	—		$	—		$	(0)		$	4,576
Other (Income) & Expense		(81)			(1)			(192)			—			(145)			(418)
Total Expense & Other (Income)		6,568			(280)			(192)			—			(145)			5,952
Pre-tax Income from Continuing Operations		1,722			460			192			—			145			2,518
Pre-tax Income Margin from Continuing Operations		11.1	%		3.0	pts.		1.2	pts.		—	pts.		0.9	pts.		16.2	%
Provision for/(Benefit from) Income Taxes ⁽⁴⁾	$	257		$	115		$	46		$	(4)		$	—		$	413
Effective Tax Rate		14.9	%		1.8	pts.		0.7	pts.		(0.2)	pts.		(0.9)	pts.		16.4	%
Income from Continuing Operations	$	1,465		$	345		$	146		$	4		$	145		$	2,105
Income Margin from Continuing Operations		9.4	%		2.2	pts.		0.9	pts.		0.0	pts.		0.9	pts.		13.5	%
Diluted Earnings/(Loss) Per Share: Continuing Operations	$	1.61		$	0.38		$	0.16		$	0.00		$	0.16		$	2.31


	Three Months Ended June 30, 2021
	Continuing Operations
				Acquisition-			Retirement-			Tax			Kyndryl-
				Related			Related			Reform			Related			Operating
	GAAP			Adjustments ⁽¹⁾			Adjustments ⁽²⁾			Impacts			Impacts ⁽³⁾			(Non-GAAP)
Gross Profit	$	7,852		$	179		$	—		$	—		$	—		$	8,031
Gross Profit Margin		55.2	%		1.3	pts.		—	pts.		—	pts.		—	pts.		56.5	%
S,G&A	$	4,849		$	(294)		$	—		$	—		$	—		$	4,555
Other (Income) & Expense		302			(1)			(317)			—			—			(16)
Total Expense & Other (Income)		6,940			(294)			(317)			—			—			6,329
Pre-tax Income/(Loss) from Continuing Operations		912			474			317			—			—			1,702
Pre-tax Income Margin from Continuing Operations		6.4	%		3.3	pts.		2.2	pts.		—	pts.		—	pts.		12.0	%
Provision for/(Benefit from) Income Taxes ⁽⁴⁾	$	101		$	105		$	53		$	(14)		$	—		$	246
Effective Tax Rate		11.1	%		3.1	pts.		1.0	pts.		(0.8)	pts.		—	pts.		14.5	%
Income from Continuing Operations	$	810		$	368		$	264		$	14		$	—		$	1,456
Income Margin from Continuing Operations		5.7	%		2.6	pts.		1.9	pts.		0.1	pts.		—	pts.		10.2	%
Diluted Earnings/(Loss) Per Share: Continuing Operations	$	0.90		$	0.41		$	0.29		$	0.01		$	—		$	1.61

(1) Includes amortization of purchased intangible assets, in process R&D, transaction costs, applicable restructuring and related expenses, tax charges related to acquisition integration and pre-closing charges, such as financing costs.

(2) Includes amortization of prior service costs, interest cost, expected return on plan assets, amortized actuarial gains/losses, the impacts of any plan curtailments/settlements and pension insolvency costs and other costs.

(3) Primarily relates to the fair value changes in the retained Kyndryl common stock and the related cash-settled swap.

(4) Tax impact on operating (non-GAAP) pre-tax income from continuing operations is calculated under the same accounting principles applied to the As Reported pre-tax income under ASC 740, which employs an annual effective tax rate method to the results.

INTERNATIONAL BUSINESS MACHINES CORPORATION

U.S. GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION

(Unaudited; Dollars in millions except per share amounts)


	Six Months Ended June 30, 2022
	Continuing Operations
				Acquisition-			Retirement-			Tax			Kyndryl-
				Related			Related			Reform			Related			Operating
	GAAP			Adjustments ⁽¹⁾			Adjustments ⁽²⁾			Impacts			Impacts ⁽³⁾			(Non-GAAP)
Gross Profit	$	15,625		$	361		$	—		$	—		$	—		$	15,986
Gross Profit Margin		52.6	%		1.2	pts.		—	pts.		—	pts.		—	pts.		53.8	%
S,G&A	$	9,452		$	(565)		$	—		$	—		$	(0)		$	8,887
Other (Income) & Expense		166			(1)			(394)			—			(367)			(596)
Total Expense & Other (Income)		13,280			(566)			(394)			—			(367)			11,953
Pre-tax Income from Continuing Operations		2,345			928			394			—			367			4,033
Pre-tax Income Margin from Continuing Operations		7.9	%		3.1	pts.		1.3	pts.		—	pts.		1.2	pts.		13.6	%
Provision for/(Benefit from) Income Taxes ⁽⁴⁾	$	218		$	224		$	104		$	112		$	—		$	657
Effective Tax Rate		9.3	%		3.4	pts.		1.7	pts.		2.8	pts.		(0.8)	pts.		16.3	%
Income from Continuing Operations	$	2,127		$	704		$	290		$	(112)		$	367		$	3,376
Income Margin from Continuing Operations		7.2	%		2.4	pts.		1.0	pts.		(0.4)	pts.		1.2	pts.		11.4	%
Diluted Earnings/(Loss) Per Share: Continuing Operations	$	2.34		$	0.77		$	0.32		$	(0.12)		$	0.40		$	3.71


	Six Months Ended June 30, 2021
	Continuing Operations
				Acquisition-			Retirement-			Tax			Kyndryl-
				Related			Related			Reform			Related			Operating
	GAAP			Adjustments ⁽¹⁾			Adjustments ⁽²⁾			Impacts			Impacts ⁽³⁾			(Non-GAAP)
Gross Profit	$	14,879		$	353		$	—		$	—		$	—		$	15,232
Gross Profit Margin		54.3	%		1.3	pts.		—	pts.		—	pts.		—	pts.		55.6	%
S,G&A	$	9,536		$	(582)		$	—		$	—		$	—		$	8,954
Other (Income) & Expense		647			(1)			(649)			—			—			(3)
Total Expense & Other (Income)		13,724			(583)			(649)			—			—			12,491
Pre-tax Income from Continuing Operations		1,155			936			649			—			—			2,741
Pre-tax Income Margin from Continuing Operations		4.2	%		3.4	pts.		2.4	pts.		—	pts.		—	pts.		10.0	%
Provision for/(Benefit from) Income Taxes ⁽⁴⁾	$	(58)		$	238		$	86		$	6		$	—		$	272
Effective Tax Rate		(5.0)	%		10.4	pts.		4.3	pts.		0.2	pts.		—	pts.		9.9	%
Income from Continuing Operations	$	1,213		$	699		$	563		$	(6)		$	—		$	2,469
Income Margin from Continuing Operations		4.4	%		2.5	pts.		2.1	pts.		(0.0)	pts.		—	pts.		9.0	%
Diluted Earnings/(Loss) Per Share: Continuing Operations	$	1.34		$	0.77		$	0.62		$	(0.01)		$	—		$	2.73

(3) Primarily relates to the fair value changes in the retained Kyndryl common stock and the related cash-settled swap.

Exhibit 99.2

Non-GAAP Financial Information

Operating (non-GAAP) Earnings Per Share and Related Income Statement Items

In an effort to provide better transparency into the operational results of the business, supplementally, the company separates business results into operating and non-operating categories. Operating earnings from continuing operations is a non-GAAP measure that excludes the effects of certain acquisition-related charges, intangible asset amortization, expense resulting from basis differences on equity method investments, retirement-related costs, certain impacts from the Kyndryl separation and their related tax impacts. Due to the unique, non-recurring nature of the enactment of the U.S. Tax Cuts and Jobs Act (U.S. tax reform), the company characterizes the one-time provisional charge recorded in the fourth quarter of 2017 and adjustments to that charge as non-operating. Adjustments include true-ups, accounting elections and any changes to regulations, laws, audit adjustments, etc. that affect the recorded one-time charge. Management also characterizes direct and incremental charges incurred related to the Kyndryl separation as non-operating given their unique and non-recurring nature. These charges primarily relate to any net unrealized gains or losses on the Kyndryl common stock and the related cash-settled swap with a third-party financial institution, which are recorded in other (income) and expense in the Consolidated Income Statement. The Kyndryl shares were retained by the company immediately following the separation, with the intent to dispose of such shares within twelve months after the distribution. For acquisitions, operating (non-GAAP) earnings exclude the amortization of purchased intangible assets and acquisition-related charges such as in-process research and development, transaction costs, applicable retention, restructuring and related expenses, tax charges related to acquisition integration and pre-closing charges, such as financing costs. These charges are excluded as they may be inconsistent in amount and timing from period to period and are significantly impacted by the size, type and frequency of the company’s acquisitions. All other spending for acquired companies is included in both earnings from continuing operations and in operating (non-GAAP) earnings. For retirement-related costs, the company characterizes certain items as operating and others as non-operating, consistent with GAAP. The company includes defined benefit plan and nonpension postretirement benefit plan service costs, multi-employer plan costs and the cost of defined contribution plans in operating earnings. Non-operating retirement-related costs include defined benefit plan and nonpension postretirement benefit plan amortization of prior service costs, interest cost, expected return on plan assets, amortized actuarial gains/losses, the impacts of any plan curtailments/settlements and pension insolvency costs and other costs. Non-operating retirement-related costs are primarily related to changes in pension plan assets and liabilities which are tied to financial market performance, and the company considers these costs to be outside of the operational performance of the business.

Overall, the company believes that supplementally providing investors with a view of operating earnings as described above provides increased transparency and clarity into both the operational results of the business and the performance of the company’s pension plans; improves visibility to management decisions and their impacts on operational performance; enables better comparison to peer companies; and allows the company to provide a long-term strategic view of the business going forward. In addition, these non-GAAP measures provide a perspective consistent with areas of interest the company routinely receives from investors and analysts. The company’s reportable segment financial results reflect pre-tax operating earnings from continuing operations, consistent with the company’s management and measurement system.

Consolidated Free Cash Flow

The company uses free cash flow as a measure to evaluate its operating results, plan shareholder return levels, strategic investments and assess its ability and need to incur and service debt. The entire free cash flow amount is not necessarily available for discretionary expenditures. The company defines consolidated free cash flow as consolidated net cash from operating activities less the change in Financing receivables and net capital expenditures, including the investment in software. A key objective of the Financing business is to generate strong returns on equity, and our Financing receivables are the basis for that growth. Accordingly, management considers Financing receivables as a profit-generating investment, not as working capital that should be minimized for efficiency. Therefore, management presents both free cash flow and net cash from operating activities that exclude the effect of Financing receivables. Consolidated free cash flow guidance is derived using an estimate of profit, working capital and operational cash flows. Since the company views Financing receivables as a profit-generating investment which it seeks to maximize, it is not considered when formulating guidance for free cash flow. As a result, the company does not estimate a GAAP consolidated net cash from operations expectation metric.

Constant Currency

When the company refers to growth rates at constant currency or adjusts such growth rates for currency, it is done so that certain financial results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of its business performance. Financial results adjusted for currency are calculated by translating current period activity in local currency using the comparable prior year period’s currency conversion rate. This approach is used for countries where the functional currency is the local currency. Generally, when the dollar either strengthens or weakens against other currencies, the growth at constant currency rates or adjusting for currency will be higher or lower than growth reported at actual exchange rates.

Exhibit 99.3

IBM 20 2022 Earnings July 18, 2022 ibm.com/investor

Forward-looking statements and non-GAAP information Certain comments made in this presentation may be characterized as forward looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the company’s current assumptions regarding future business and financial performance. Those statements by their nature address matters that are uncertain to different degrees. Those statements involve a number of factors that could cause actual results to differ materially. Additional information concerning these factors is contained in the Company’s filings with the SEC. Copies are available from the SEC, from the IBM website, or from IBM Investor Relations. Any forward-looking statement made during this presentation speaks only as of the date on which it is made. The company assumes no obligation to update or revise any forward-looking statements except as required by law; these charts and the associated remarks and comments are integrally related and are intended to be presented and understood together. including operating earnings and other “operating” financial measures, consolidated free cash flow, net cash from operating activities excluding IBM Financing receivables, and adjustments for currency. The rationale for management’s use of this non-GAAP information is included as Exhibit 99.2 to the company’s Form 8-K submitted to the SEC on July 18, 2022. The reconciliation of non-GAAP information to GAAP is included on the slides entitled “Non-GAAP supplemental materials” in this presentation, as well as in Exhibit 99.1 to the company’s Form 8 -K submitted to the SEC on July 18, 2022. To provide better transparency, the company also discusses management performance metrics including hybrid cloud revenue, annual recurring revenue, signings, and book-to-bill. The metrics are used to monitor the performance of the business and are viewed as useful decision-making information for management and stakeholders. The rationale for management’s use of these performance metrics and their calculation are included in the Management Discussion section of the company’s 2021 Annual Report, which is Exhibit 13 to the Form 10-K submitted with the SEC on February 22, 2022. For other related information please visit the Company’s investor relations website at: Unless otherwise specified, results are presented on a continuing operations basis. All references to revenue impacts from sales to Kyndryl are incremental sales post-separation. In an effort to provide additional and useful information regarding the company’s financial results and other financial information as determined by generally accepted accounting principles (GAAP), the company also discusses, in its earnings press release and presentation materials, certain non-GAAP information https://www.ibm.com/investor/events/earning s-2q22 2

Arvind Krishna Chairman and Chief Executive Officer James Kavanaugh SVP, Finance & Operations, Chief FinancialOfficer 3

CEO perspective 2Q22 Performance “In the quarter we delivered good revenue performance with balanced growth across our geographies, driven by client demand for our hybrid cloud and AI offerings. The IBM team executed our strategy well. Hybrid cloud and AI progress With our first half results, we continue to expect full-year revenue growth at the high end of our mid-single digit model.” A rvind Krishna IBM Chairman and CEO Clients, ecosystem and innovation 4

Hybrid cloud and AI progress Our platform approach Accelerating client adoption Expanding partner ecosystem Delivering innovation 5 Edge IBM Infrastructure zSystems Distributed Infrastructure (IBM Cloud, Power, Storage) Infrastructure Support Enterprise Infrastructure Public Clouds AWS Azure Others Red Hat Hybrid Cloud PlatformDevelopment, Security and Operational Services OpenShift Red Hat Enterprise Linux Ansible Automation Platform IBM Software Automation IBM Cloud PaksData & AI Security Transaction Processing Software and SaaS Partners System Integrator Partners IBM Consulting Business Transformation Technology Consulting Application Operations

Financial highlights 2Q22 16% Revenue growth incl. nearly 5 pts from sales to Kyndryl 420bps Pre-tax margin expansion (Operating) >70% Revenue mix in software and consulting $7.8B Cash on hand, incl. marketable securities “We are a faster-growing, focused, disciplined company with sound business fundamentals. $21.7B Hybrid cloud revenue (TTM), +19% yr/yr Our recurring revenue stream and solid cash generation position us well to continue to invest in R&D, acquire new companies, and strengthen our talent in every part of the business, while also returning value to shareholders through our dividend.” Ja mes Kavanaugh IBM SVP & CFO Revenue growth rates @CC 6 $15.5B $3.3B RevenueFree Cash Flow (YTD)

Software Broad-based growth across Hybrid Platform & Solutions Annual recurring revenue* of $12.9B, +8% yr/yr Investments in innovation and go to market Revenue categories Hybrid Platform & Solutions + 9% yr/yr ~1.5 pts sales to Kyndryl Tr ansaction Processing + 19% yr/yr ~22 pts sales to Kyndryl Red Hat Automation Data & AI Security 17% 8% 4% 5% 2Q22 results; revenue and annual recurring revenue growth rates @CC *Annual recurring revenue for Hybrid Platform & Solutions 7 $6.2B +12% RevenueRevenue growth (includes ~7 pts from sales to Kyndryl)

Consulting Pervasive double-digit revenue growth Book-to-bill ratio of 1.1 for the past year Strength in Red Hat and strategic partner practices Investments in skills and capabilities; competitive labor market Revenue categories Business Tr ansformation + 16% yr/yr Application Operations + 17% yr/yr Technology C onsulting + 23% yr/yr 8 2Q22 results; revenue growth rates @CC $4.8B +18% RevenueRevenue growth

Infrastructure Solid z16 launch Distributed Infrastructure growth driven by storage and high-end Power Pre-tax margin reflects mix benefit from zSystems growth Revenue categories Hybrid Infrastructure + 41% yr/yr ~7 pts sales to Kyndryl I nfrastructure Support + 5% yr/yr ~8 pts sales to Kyndryl zSystems Distributed +77% Infrastructure +17% 9 2Q22 results; revenue growth rates @CC $4.2B +25% RevenueRevenue growth (includes ~7 pts from sales to Kyndryl)

Summary 2022 Expectations Revenue growth @CC at high-end of mid-single digit model, plus ~3.5 pts from sales to Kyndryl Free cash flow of ~$10 billion 2Q 2022 Progress Executing a focused hybrid cloud and AI strategy Broad-based revenue performance Investing in innovation, ecosystem, talent 10

ibm.com/investor .----- -_---.-·---- - ----_.._

Supplemental material Revenue and P&L highlights Cash flow and balance sheet highlights Currency impact on revenue growth Software & Infrastructure segment details Consulting segment details Expense summary Balance sheet summary Cash flow summary Cash flow (ASC 230) Software segment revenue categories Consulting segment revenue categories Infrastructure segment revenue categories Non-GAAP supplemental materials ● ● ● ● ● ● ● ● ● ● ● ● ● Unless otherwise specified, results are presented on a continuing operations basis. Some columns and rows in these materials, including the supplemental exhibits, may not add due to rounding 12

Revenue and P&L highlights ~5 pts ~1 pts Revenue Hybrid cloud Hybrid cloud (TTM) $15.5 $5.9 $21.7 16% 24% 19% Gross profit Expense Pre-tax income Net income Earnings per share $8.5 $6.0 $2.5 $2.1 $2.31 5% 6% 48% 45% 43% ~ 3 pts ~ 6 pts ~ 6 pts Gross profit margin Expense E/R Pre-tax income margin Net income margin Tax rate 54.5% 38.3% 16.2% 13.5% 16.4% (2.0 pts) 6.2 pts 4.2 pts 3.3 pts (1.9 pts) Americas Europe/ME/Africa Asia Pacific $8.1 $4.5 $2.9 15% 17% 15% Revenue growth rates @CC, $ in billions 13 Operating P&L highlights % 2Q22 B/(W) Yr/Yr Geography revenue2Q22 B/(W)sales to KD Yr/Yrbenefit Revenue highlights 2Q22 B/(W)sales to KD Yr/Yrbenefit Operating P&L highlights $ 2Q22 B/(W) Yr/Yr

Cash flow and balance sheet highlights Consolidated net cash from operations* Consolidated free cash flow** $2.6 $2.1 $0.9 $1.1 Cash & marketable securities Total debt $7.8 $50.3 $7.6 $51.7 $8.2 $55.2 Net capital expenditures Acquisitions Dividends $0.5 $0.3 $1.5 IBM Financing debt Core (non-IBM Financing) debt $12.3 $38.0 $13.9 $37.8 $17.5 $37.7 $ in billions *Non-GAAP financial measure; excludes Financing receivables **Non-GAAP financial measure; adjusts for Financing receivables and net capital expenditures 14 Selected debt measuresJun 22 Dec 21 Jun 21 Selected uses of cash2Q22 Balance sheet Jun 22 Dec 21 Jun 21 Cash flow 2Q22 Yr/Yr

Currency impact on growth US $B $15.5 ($0.9) Yr/Yr 9.3% (6 pts) 15.6% Revenue as reported Currency impact Revenue @CC 15 Quarterly averages per US $ 1Q22 Yr/Yr2Q22 Yr/Yr Spot 7/15/22 3Q22 4Q22 FY22 Euro 0.89 (7%) 0.94 (13%) Pound 0.75 (3%) 0.80 (11%) Yen 116 (10%) 130 (19%) Revenue impact, future @ 7/15/22 Spot (6 pts) Prior view @ 4/18/22 Spot~(5 pts) 0.99 0.84 139 (17%) (13%) (13%) (16%) (14%) (11%) (26%) (22%) (19%) ~(8 pts) ~(6 pts) ~(6 pts) ~(4 pts) (2-3 pts) (3-4 pts)

Software & Infrastructure segment details Includes sales to Kyndryl Revenue Hybrid Infrastructure zSystems Distributed Infrastructure Infrastructure Support Pre-tax income Pre-tax income margin $4.2 $2.8 25% 41% 77% 17% 5% 55% 4.1 pts Revenue Hybrid Platform & Solutions Red Hat Automation Data & AI Security Transaction Processing Pre-tax income Pre-tax income margin $6.2 $4.4 12% 9% 17% 8% 4% 5% 19% 30% 4.0 pts $1.5 $0.8 17.9% $1.8 $1.4 22.3% Hybrid cloud revenue (TTM) $3.7 (5%) Hybrid cloud revenue (TTM) $9.0 23% Annual recurring revenue* $12.9 8% Revenue and annual recurring revenue growth rates @CC, $ in billions *Annual recurring revenue for Hybrid Platform & Solutions 16 Infrastructure segment 2Q22 B/(W) Yr/Yr Software segment 2Q22 B/(W) Yr/Yr

Consulting segment details Revenue Business Transformation Technology Consulting Application Operations Gross profit margin Pre-tax income Pre-tax income margin $4.8 $2.2 $0.9 $1.7 24.2% $0.3 7.1% 18% 16% 23% 17% (3.4 pts) 27% 1.0 pts Hybrid cloud revenue (TTM) $8.6 32% Signings Book-to-bill ratio (TTM) 7% $4.7 1.1 Revenue and signings growth rates @CC, $ in billions 17 Consulting segment 2Q22 B/(W) Yr/Yr

Expense summary $ in billions *includes ~($0.230B) gain on divestiture of our healthcare software assets and ~($0.145B) net exchange gain which mitigates currency impact throughout the P&L **includes acquisitions in the last twelve months net of non-operating acquisition-related charges and includes impact of closed divested businesses ***represents the percentage change after excluding the impact of currency, acquisitions and divestitures 18 Expense2Q22 B/(W) Yr/Yr Acq/ CurrencyDivest** Base*** SG&A – operating $4.6 Flat RD&E $1.7 (2%) IP and custom development income ($0.2) 32% Other (income)/expense - operating ($0.4)* NM Interest expense $0.3 (5%) Operating expense & other income $6.0 6% 4 pts (2 pts) (3 pts) 2 pts 0 pts (4 pts) 7 pts 2 pts (3 pts)

Balance sheet summary Consolidated Cash & marketable securities Core (non-IBM Financing) assets* IBM Financing assets Total assets $7.8 $105.4 $14.3 $127.5 $7.6 $108.9 $15.5 $132.0 $8.2 $119.2 $19.4 $146.8 Other liabilities Core (non-IBM Financing) debt* IBM Financing debt Total debt Total liabilities Equity $57.7 $38.0 $12.3 $50.3 $108.0 $19.5 $61.3 $37.8 $13.9 $51.7 $113.0 $19.0 $69.6 $37.7 $17.5 $55.2 $124.7 $22.1 $ in billions *includes eliminations of inter-company activity 19 Jun 22 Dec 21 Jun 21

Cash flow summary Consolidated $ in billions 20 QTDB/(W) 2Q22Yr/Yr YTDB/(W) 2Q22 Yr/Yr Net cash from operations $1.3 ($1.3) Less: IBM Financing receivables($1.3) ($2.2) Net cash from operations (excluding IBM Financing receivables)$2.6 $0.9 Net capital expenditures ($0.5) $0.2 Free cash flow (excluding IBM Financing receivables)$2.1 $1.1 Acquisitions ($0.3) $1.5 Divestitures $1.2 $1.2 Dividends ($1.5) ($0.0) Non-IBM Financing debt ($2.9) ($2.3) Other (includes IBM Financing net A/R & IBM Financing debt)* ($1.6) ($1.3) Change in cash & marketable securities ($3.0) $0.1 $4.6 ($3.0) $0.4 ($3.4) $4.2 $0.4 ($0.9) $0.3 $3.3 $0.8 ($1.0) $1.9 $1.3 $1.3 ($3.0) ($0.0) $1.7 $4.1 ($2.2) ($1.7) $0.2 $6.3

Cash flow (ASC230) Consolidated $ in billions 21 QTDQTD 2Q222Q21 YTDYTD 2Q22 2Q21 Net income from operations $1.4 $1.3 Depreciation / amortization of intangibles $1.2 $1.7 Stock-based compensation $0.3 $0.2 Working capital / other ($0.3) ($1.5) IBM Financing A/R ($1.3) $0.9 Net cash provided by operating activities $1.3 $2.6 Capital expenditures, net of payments & proceeds ($0.5) ($0.7) Divestitures, net of cash transferred $1.2 ($0.0) Acquisitions, net of cash acquired ($0.3) ($1.7) Marketable securities / other investments, net ($0.3) ($0.2) Net cash provided by/(used in) investing activities $0.2 ($2.7) Debt, net of payments & proceeds($2.5) ($1.5) Dividends($1.5) ($1.5) Common stock repurchases-- Financing - other ($0.2) ($0.2) Net cash provided by/(used in) financing activities ($4.2) ($3.1) Effect of exchange rate changes on cash($0.3) $0.1 Net change in cash, cash equivalents & restricted cash($3.0) ($3.1) $2.1 $2.3 $2.5 $3.4 $0.5 $0.5 ($0.9) ($2.3) $0.4 $3.8 $4.6 $7.5 ($0.9) ($1.2) $1.3 ($0.0) ($1.0) ($2.9) ($0.6) ($0.6) ($1.2) ($4.7) $0.4 ($5.8) ($3.0) ($2.9) - - ($0.3) ($0.2) ($2.8) ($8.9) ($0.3) ($0.1) $0.3 ($6.1)

Software segment categories Hybrid Platform & Solutions Software, infused with AI, to help clients operate, manage, and optimize their IT resources and business processes within hybrid, multi -cloud environments Red Hat: incl. RHEL, OpenShift, Ansible Automation: incl. business automation, AIOps and management, integration, and application servers Data & AI: incl. data fabric, customer care, data management, business analytics, dataops & governance, asset & supply chain management, information exchange and weather Security: incl. software and services for threat, data and identity Hybrid Platform & Solutions Red Hat Transaction Processing Automatio Security Data & AI Transaction Processing Software that supports clients’ mission-critical on-premise workloads in industries such as banking, airlines and retail incl. transaction processing software such as Customer Information Control System and storage software, and analytics and integration software running on IBM operating systems (e.g., DB2 and WebSphere running on z/OS) 22 Revenue categories – FY 2021 Revenue categories

Consulting segment categories Business Transformation Services that enable clients to apply technologies at scale to transform key workflows, processes and domains end-to-end incl. finance & supply chain, talent, strategy, business process design and operations, data and analytics, and system integration These services deploy AI in business processes to exploit the value of data incl. a full ecosystem of partners: SAP, Adobe, Salesforce and Oracle, among others Business Transformation Technology Consulting Application Operations Technology Consulting The skills to architect and implement cloud platforms and strategies to transform enterprise experience and enable innovation, including application modernization on the hybrid cloud with Red Hat OpenShift Application Operations Application and cloud platform services required to operationalize and run cloud platforms Manage, optimize, and orchestrate application and data workloads across environments through both custom applications and ISV/ERP packages 23 Revenue categories – FY 2021 Revenue categories

Infrastructure segment categories Hybrid Infrastructure Innovative infrastructure platforms to help meet the new requirements of hybrid multi-cloud and enterprise AI workloads leveraging flexible and as-a-service consumption models zSystems: incl. hardware and operating system Distributed Infrastructure: incl. Power hardware and operating system, storage hardware, IBM Cloud IaaS, OEM asset recovery service Hybrid Infrastructure zSystems Infrastructure Support Infrastructure Support Comprehensive, proactive and AI enabled services to maintain and improve the availability and value of clients’ IT infrastructure (hardware and software) both on-premises and in the cloud incl. maintenance for IBM products and other technology platforms Di tributed Infr structure 24 Revenue categories – FY 2021 Revenue categories

Non-GAAP supplemental materials Reconciliation of revenue performance - 2Q 2022 2Q22 Yr/Yr GAAP @CC Total revenue Total hybrid cloud Total hybrid cloud (TTM) 9% 18% 16% 16% 24% 19% Americas Europe/ME/Africa Asia Pacific 14% 5% 3% 15% 17% 15% The above reconciles the non-GAAP financial information contained in the “Financial highlights”, “Revenue and P&L highlights”, and “Prepared remarks” discussions in the company’s earnings presentation. See Exhibit 99.2 included in the company’s Form 8 -K dated July 18, 2022, for additional information on the use of these Non-GAAP financial measures 25

Non-GAAP supplemental materials Reconciliation of segment revenue performance - 2Q 2022 2Q22 Yr/Yr 2Q22 Yr/Yr GAAP @CC GAAP @CC Consulting Business Transformation Technology Consulting Application Operations Hybrid cloud revenue (TTM) 10% 9% 14% 9% 28% 18% 16% 23% 17% 32% Software Hybrid Platform & Solutions Red Hat Automation Data & AI Security Transaction Processing Hybrid cloud revenue (TTM) 6% 4% 12% 4% Flat Flat 12% 20% 12% 9% 17% 8% 4% 5% 19% 23% Infrastructure Hybrid Infrastructure zSystems Distributed Infrastructure Infrastructure Support Hybrid cloud revenue (TTM) 19% 34% 69% 11% (2%) (7%) 25% 41% 77% 17% 5% (5%) The above reconciles the non-GAAP financial information contained in the “Software”, “Consulting”, “Infrastructure”, “Software & Infrastructure segment details”, “Consulting segment details”, and “Prepared remarks” discussions in the company’s earnings presentation. See Exhibit 99.2 included in the company’s Form 8-K dated July 18, 2022, for additional information on the use of these Non-GAAP financial measures. 26

Non-GAAP supplemental materials Reconciliation of expense summary - 2Q 2022 2Q22 Non-GAAP Adjustments GAAP Operating (Non-GAAP) SG&A Currency Acquisitions/divestitures Base* RD&E Currency Acquisitions/divestitures Base* Operating expense & other income Currency Acquisitions/divestitures Base* 4 pts (2 pts) (3 pts) 0 pts 0 pts 0 pts 4 pts (2 pts) (3 pts) 2 pts 0 pts (4 pts) 0 pts 0 pts 0 pts 2 pts 0 pts (4 pts) 5 pts 2 pts (2 pts) 2 pts 0 pts (1 pts) 7 pts 2 pts (3 pts) The above reconciles the non-GAAP financial information contained in the “Expense summary” discussion in the company’s earnings presentation. See Exhibit 99.2 included in the company’s Form 8 -K dated July 18, 2022, for additional information on the use of these Non-GAAP financial measures. *Represents the percentage change after excluding the impact of currency, acquisitions and divestitures. 27

Non-GAAP supplemental materials Reconciliation of continuing operations - 2Q 2022 2Q22 Retirement-related adjustments Acquisition-related adjustments Tax reform impacts Kyndryl-related impact Operating (non-GAAP) GAAP Gross profit Gross profit margin SG&A Other (income) & expense Total expense Pre-tax income Pre-tax income margin Tax rate Net income Net income margin Earnings per share $8,290 53.4% 4,855 (81) 6,568 1,722 11.1% 14.9% 1,465 9.4% $1.61 $180 1.2 pts (279) (1) (280) 460 3.0 pts 1.8 pts 345 2.2 pts $0.38 — — — (192) (192) 192 1.2 pts 0.7 pts 146 0.9 pts $0.16 — — — — — — — (0.2 pts) 4 0.0 pts $0.00 — — (0) (145) (145) 145 0.9 pts (0.9 pts) 145 0.9 pts $0.16 $8,470 54.5% 4,576 (418) 5,952 2,518 16.2% 16.4% 2,105 13.5% $2.31 $ in millions (except EPS which is in whole dollars) The above reconciles the non-GAAP financial information contained in the “Financial highlights”, “Revenue and P&L highlights”, “Expense summary” and “Prepared remarks” discussions in the company’s earnings presentation. See Exhibit 99.2 included in the company’s Form 8 -K dated July 18, 2022, for additional information on the use of these Non-GAAP financial measures. 28

Non-GAAP supplemental materials Reconciliation of tax rate and pre-tax income margin - expectations Operating (non-GAAP) B/(W) GAAP B/(W) Tax rate Full-year 2022* Mid Teens Mid-High Teens Pre-tax margin Improvement Yr/Yr from 3Q21 to 3Q22 ~3 pts** ~2 pts *includes estimate of discrete tax events for the year; actual events will be recorded as they occur **does not assume a mark-to-market impact in the third quarter 2022 of the Kyndryl retained shares as we cannot forecast the Kyn dryl stock price The above reconciles the non-GAAP financial information contained in the “Prepared remarks” discussion in the company’s earnings presentation. See Exhibit 99.2 included in the company’s Form 8 -K dated July 18, 2022, for additional information on the use of this Non-GAAP financial measure. 29

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