IBM −23%: The Memory Squeeze Arrives in Enterprise Budgets

The Morning 10

1. 1 Weekly Signal, day one — the tape closes on the line
2. 2 The split tape — software up, semis down hard
3. 3 SKHY — session four, two dollars from the offer
4. 4 The top of the stack fell less — and TSMC's sales say demand is fine
5. 5 AI Build-Out Layers (Rubin) — the unwind maps onto Layer 3
6. 6 The belief lines, tested together — gold 4,000, bitcoin 60k
7. 7 Vol wakes from the floor — and beta has already expanded
8. 8 US CPI (Jun) — 8:30 ET, the macro half of the morning
9. 9 Big-bank earnings — five majors before the bell
10. 10 Outside view — Niles, on the day the tape agreed

The full Morning 10 →

Daily Pulse — IBM −23%: The Memory Squeeze Arrives in Enterprise Budgets

IBM pre-announced a preliminary Q2 miss and fell 23% — its steepest single-day drop in decades. The causes named are two stories this diary has tracked for weeks, now printing in one mega-cap: enterprise customers front-ran memory and server price increases, cannibalizing mainframe budgets — the DRAM squeeze arriving in corporate IT — and spent more on AI while the legacy stack shrank. Inside the same print: Red Hat +11%, distributed infrastructure +37%, gen-AI consulting signings up. Not software weakness — legacy weakness. The tape needed two hours to figure that out: it sold the whole software complex first — ServiceNow −8%, Adobe and Salesforce deep red — then re-sorted it name by name, with Cloudflare trading through its all-time-high line to a record while the legacy-exposed names stayed at their lows. Disrupted and disruptor, priced apart in one afternoon.

The full Pulse →

Print-record cards of the day

• NVDA — Nvidia: EPS beats 10/10 · revenue 10/10 · reactions 2 up / 2 flat / 6 down · next print 2026-08-26

On the tape

• Money Temperature · Risk-on rally — 2 heating / 2 cooling
• Cross-asset day: VIX 16.5, DXY 100.94, 10Y 4.61% — risk-on regime
• Euro-AI 50 · 1-month leaders — ATS.VI +19.20% / BESI.AS -22.08%
• Euro-AI 50 · Daily leaders — MELE.BR +4.50% / ARM -7.55%
• HALO 100 · 1-month leaders — VKTX +37.37% / FLNC -29.88%
• HALO 100 · 1-month sector leaders — LONGEVITY +13.59% / SPACE -16.06%
• HALO 100 · Sector flow — PAYMENTS +1.47% / NUCLEAR -4.72%
• HALO 100 · Daily leaders — FWONA +7.10% / ASTS -7.83%