Signings Fell 13.3% in 2025, Rose 6.8% in 2026Thin moat

IBM (IBM) — moat facet

Consulting signings fell 13% in 2025 and rose 7% in the first half of 2026, which says IBM wins new work but not reliably.

Signings are where Consulting's future shows up first. They were $25,103 million in 2024 and $21,757 million in 2025, down 13.3%1; IBM called 2024 a year of "strong performance in signings"2. In the first half of 2026 signings were $10,388 million, up 6.8 percent3, and $5,034 million in the second quarter, up 5.0%4.

Consulting signings growth (%)-13.3%2025+5.0%Q2 2026+6.8%H1 2026IBM 2025 Annual Report, Form 10-Q Q2 2026; magnitudes, signs in labels
A fall, then a recovery.

IBM describes the recovery as the second consecutive quarter of "solid signings growth"5. Krishna attributed it to "strong GenAI contribution"6.

Signings are a leading indicator but an imprecise one. They are management estimates of contract value7, and large contracts make individual quarters lumpy. The drop in 2025 came after an unusually strong year.

For the moat, signings measure how often clients choose IBM for new work. The consulting business has no switching costs on new projects; each is won against competitors. A rising trend means IBM is winning more of those contests.

At constant currency the recovery is smaller. Second-quarter signings grew 5.0 percent as reported and 5.9 percent adjusted for currency; first-half signings grew 6.8 percent as reported and 5.9 percent adjusted8. The 2025 decline was 13.3% as reported and 14.7% adjusted9. On either measure, 2026 so far has recovered less than half of what 2025 lost.

The number to watch is the full-year change in signings for 2026. If the first half's gain holds, revenue should grow in 2027; a second-half decline that erased it would mean 2025's fall was the trend.

Moat trajectory: Holding steady

H1 2026 +6.8%; Q2 +5.0%.

The number that tests this moat
Reported
Consulting signings, latest quarter
$5,034M, +5.0% (Q2 2026)

New consulting contracts; a return to decline in the second half would mean 2025's drop was the trend.

Source: IBM Form 10-Q, Q2 2026 ↗
⚠ Threats to the moat
⚠ THREAT 01
Large Deals Failed to Close
IBM missed because large deals slipped, and if they do not close in the third quarter they were never delayed.
References
  1. ReportedThey were $25,103 million in 2024 and $21,757 million in 2025, down 13.3%; IBM called 2024 a year of "strong performance in signings".
    IBM 2025 Annual Report (Form 10-K exhibit) - management discussion, consolidated financial statements and notes - management discussion of the Consulting segment: revenue by area, signings, book-to-bill and backlog. — FY2025 · publ. 24 February 2026 · source ↗
  2. ReportedThey were $25,103 million in 2024 and $21,757 million in 2025, down 13.3%; IBM called 2024 a year of "strong performance in signings".
    IBM 2025 Annual Report (Form 10-K exhibit) - management discussion, consolidated financial statements and notes - management discussion of the Consulting segment: revenue by area, signings, book-to-bill and backlog. — FY2025 · publ. 24 February 2026 · source ↗
  3. ReportedIn the first half of 2026 signings were $10,388 million, up 6.8 percent, and $5,034 million in the second quarter, up 5.0%.
    IBM Form 10-Q for the quarter ended 30 June 2026 - segment results, revenue categories, RPO, the Confluent acquisition and management discussion - Consulting segment results and signings. — Q2 2026 · publ. 23 July 2026 · source ↗
  4. ReportedIn the first half of 2026 signings were $10,388 million, up 6.8 percent, and $5,034 million in the second quarter, up 5.0%.
    IBM Form 10-Q for the quarter ended 30 June 2026 - segment results, revenue categories, RPO, the Confluent acquisition and management discussion - Consulting segment results and signings. — Q2 2026 · publ. 23 July 2026 · source ↗
  5. ReportedIBM describes the recovery as the second consecutive quarter of "solid signings growth".
    IBM Form 10-Q for the quarter ended 30 June 2026 - segment results, revenue categories, RPO, the Confluent acquisition and management discussion - Consulting segment results and signings. — Q2 2026 · publ. 23 July 2026 · source ↗
  6. ReportedKrishna attributed it to "strong GenAI contribution".
    Arvind Krishna's letter to IBM investors with preliminary second-quarter 2026 results, Form 8-K exhibit 99.1. — Q2 2026 · publ. 14 July 2026 · source ↗
  7. ReportedThey are management estimates of contract value, and large contracts make individual quarters lumpy.
    IBM 2025 Annual Report (Form 10-K exhibit) - management discussion, consolidated financial statements and notes - segment note: segment revenue, segment profit, margins and reconciliation to reported revenue. — FY2025 · publ. 24 February 2026 · source ↗
  8. ReportedSecond-quarter signings grew 5.0 percent as reported and 5.9 percent adjusted for currency; first-half signings grew 6.8 percent as reported and 5.9 percent adjusted.
    IBM Form 10-Q for the quarter ended 30 June 2026 - segment results, revenue categories, RPO, the Confluent acquisition and management discussion - Consulting segment results and signings. — Q2 2026 · publ. 23 July 2026 · source ↗
  9. ReportedThe 2025 decline was 13.3% as reported and 14.7% adjusted.
    IBM 2025 Annual Report (Form 10-K exhibit) - management discussion, consolidated financial statements and notes - segment note: segment revenue, segment profit, margins and reconciliation to reported revenue. — FY2025 · publ. 24 February 2026 · source ↗
Sources
Generated September 28, 2026