On Monday, February 23, 2026, shares of International Business Machines (IBM) experienced their most severe collapse in over a quarter-century. The stock plummeted 13.15%, closing at $223.35, which wiped out more than $31 billion in market capitalization in a single trading session.
This “IBM Crash” has sent ripples through the global tech sector, contributing to a broader 5% slide in the Nifty IT index in India today.
The Catalyst: Anthropic’s “Claude Code”
The freefall was triggered by a blog post from AI startup Anthropic detailing the capabilities of its new tool, Claude Code.
- Targeting COBOL: Anthropic demonstrated that Claude Code can automate the modernization of COBOL, a 60-year-old programming language that remains the backbone of global banking, airlines, and government infrastructure.
- The Threat to IBM: Most of these legacy COBOL systems run on IBM mainframes. For decades, IBM has enjoyed a lucrative “moat” by charging premium rates for armies of consultants to manually maintain and update these systems over years-long contracts.
- The Disruption: Anthropic claimed that its AI can do in quarters what previously took years, potentially turning a multi-billion dollar consulting business into an automated, low-cost commodity.
Historic Context of the Decline
The 13.15% drop is statistically significant for “Big Blue,” which is typically known for its stability.
| Metric | February 23, 2026 Milestone |
| Daily Decline | -13.15% (Worst since Oct 18, 2000) |
| Market Cap Lost | $31.2 Billion |
| Monthly Performance | -27% in February (Worst month since 1968) |
| S&P 500 Status | Worst performing stock in the index for the day. |
The “Legacy vs. AI” Narrative
Investors are currently treating legacy tech firms as “AI casualties.” While IBM has its own AI platform, Watsonx, the market currently views Anthropic’s “Claude Code” as a more direct and efficient solution for legacy modernization.
- The Fear: If companies can use AI to migrate away from mainframes to the cloud more easily, IBM loses both its high-margin consulting revenue and its recurring hardware (mainframe) revenue.
- The Defense: Some analysts argue the reaction is a “vibe-based” overcorrection. They point out that IBM’s fundamental cash flow remains strong and that the company is “disrupting itself” by integrating similar AI tools into its own services.
Global Contagion
The IBM crash immediately impacted Indian IT giants that share similar business models based on legacy system maintenance:
- TCS: Fell ~4%
- Infosys: Fell ~4%
- Wipro: Fell ~5%
- HCL Tech: Fell ~6%
