IBM's COBOL Conundrum: AI Threatens Mainframe Revenue

0:00On March 6th, here's the latest out of Durham. IBM took a big hit on Wall Street late last month. On the last Monday in February, its stock plunge 13%, the worst single-day drop in 25 years. The trigger was a blog post for Manthrobic, highlighting how its clawed code AI tool could modernize sealball and old programming language from the Eisenhower era that powers banks, airlines, and most big businesses. Cobalt still runs 9 out of 10 ATM transactions in the United States and hundreds of billions of lines of code worldwide. IBM makes a lot of money helping companies update it for new tech and rules. Analysts say mainframe services like this account for nearly one-fifth of IBM's revenue, and the idea of cheap AI alternatives, spooked investors. Reactions poured in fast. One consultant noted the post wiped $30 billion off IBM's market cap. Experts and Morgan Stanley and UBS say smaller firms might switch to AI, but big government

1:00and corporate clients will stick with IBM due to security. Data rules and complex systems. IBM fired back, saying new AI tools like their own are options, but true modernization needs deep expertise beyond simple code translation. By Friday, IBM's stock had recovered most of that drop. Two company executives even posted their own blogs on Cobalt updates right after. Still, shares are down 14% for the year amid a wider sell-off in AI-driven software stocks. Meanwhile, in North Carolina tech news, boom supersonic has not shared hiring plans for its Greensboro factory, leaving state incentives in question. The Senate passed a bipartisan bill to revive key federal startup research grants, and Duke University bumped its minimum wage to $20 an hour for over 4,000 workers. We'd like to thank our sponsor for making this episode possible. Headphones in a pillow, simple idea, surprisingly addictive, S-O-L-I-S-O-L-Pillow.com.