11:05 AM EDT, 10/16/2025 (MT Newswires) -- International Business Machines ( IBM ) is likely to post "solid" Q3 financial results driven by the infrastructure segment outperformance, RBC Capital Markets said in a Wednesday research report. The company is scheduled to report its Q3 results on Oct. 22.

Focus remains on re-acceleration in Red Hat growth in H2 on double-digit annualized bookings amid challenging comps, which will be vital to investor confidence in management's ability to deliver mid-teen fiscal year growth, according to the note.

Free cash flow is also expected to continue benefitting from the company's "client zero" cost savings, utilizing GenAI for efficiency gains, analysts wrote, adding that they expect GenAI consulting bookings of $1.50 billion to $2 billion.

The company's pending acquisition of Cognitus, a SAP service provider with AI-powered offerings, aligns with its recent commentary on the "interconnectedness" of software and consulting in the current "AI boom," the brokerage stated.

"While quantum remains a longer-term driver, we'd expect management to address the topic, including its recent bond trading trial with HSBC," according to RBC.

The brokerage said it reiterated its outperform rating on the stock and price target of $315 per share.

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