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IBM will split into two separate companies by end of 2021

The new company will focus on lower-margin lines of businesses.


IBM will split into two separate companies by end of 2021 | BEAMSTART News

Global technology company, IBM, announced this morning that the technology giant will be splitting into 2 separate companies.

The news was announced by CEO Arvind Krishna in an investor call earlier today.

With the new split, IBM will be spinning off some of its lower-margin lines of businesses into the new company, and prioritize higher-margin cloud services.

"We divested networking back in the '90s, we divested PCs back in the 2000s, we divested semiconductors about five years ago because all of them didn’t necessarily play into the integrated value proposition," mentioned CEO Arvind Krishna. 

The name of IBM's new spin-off company has yet to be finalized, and is currently referred to as "NewCo" in all of IBM's marketing and investor relations material.

Investors are reacting positively on the news of the 109-year-old company's plans, resulting in its stock rallying 7% later during the day.

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