IBM Tumbles on Weak Preliminary Results; Tower Semiconductor Soars on Japan Expansion

Shares of International Business Machines Corp. plunged in premarket trading Tuesday after the company released disappointing preliminary second-quarter results, while Tower Semiconductor surged on news of a multi-billion dollar expansion in Japan. The divergent moves came as investors shifted focus to the second-quarter earnings season, with major U.S. banks also reporting mixed results.

Technology and Semiconductor Movers

IBM shares plummeted 19% after its preliminary Q2 results failed to meet Wall Street expectations, with the company citing weakness in its infrastructure business. The negative report created a ripple effect across the software sector, with shares of Accenture, ServiceNow, Workday, and Salesforce also trading lower.

In contrast, Tower Semiconductor (TSEM) saw its stock jump nearly 19%. The Israeli chipmaker announced a $3 billion expansion of its operations in Japan, supported by $1 billion in grants from the Japanese government. The investment is aimed at increasing the company's capacity for silicon photonics, silicon germanium, and advanced packaging.

Banks Kick Off Earnings Season

Financial institutions were in the spotlight as earnings season began, though positive headline numbers did not always translate to share gains.

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• JPMorgan Chase (JPM) stock slipped 1.7% despite reporting quarterly earnings and revenue that beat analyst estimates. Investor sentiment was reportedly tempered by the fact that a significant portion of the earnings was driven by one-off investment gains.
• Bank of America (BAC) eased 1.1% even after posting a 27% increase in quarterly profit, bolstered by record trading revenue and a rebound in investment banking fees.
• Wells Fargo (WFC) was an outlier, gaining 1.5% after its second-quarter earnings and revenue surpassed expectations. The bank attributed the strong performance to higher net interest income and a 17% rise in profit.

Other Corporate Highlights

Several other companies made significant moves on corporate news. CleanSpark (CLSK) shares jumped 15.6% after the bitcoin miner signed a 20-year infrastructure lease for its Georgia data center campus. The agreement is expected to generate approximately $6.6 billion in revenue over its initial term.

Additionally, Liberty Energy (LBRT) climbed about 6% following the announcement of a strategic partnership with SLB to develop power generation solutions for data centers. SLB shares edged 0.6% higher on the news.