On February 23, IBM experienced its worst stock market decline in over 25 years, dropping 13% due to fears that AI startup Anthropic’s Claude Code tool could challenge its corporate IT supremacy. This decline was triggered by concerns over COBOL modernization, a legacy programming language prevalent on IBM mainframes. Despite the setback, IBM defended its core mainframe business, asserting that its platform’s value lies in its robust performance and security across multiple programming languages, not just COBOL. IBM’s Senior VP Rob Thomas emphasized that true modernization involves more than code translation; it requires a comprehensive understanding of system architecture and integration. The firm’s ongoing investment in AI, including tools like Watsonx Code Assistant for Z, seeks to tackle complex modernization challenges. With examples from organizations like the Royal Bank of Canada and ANZ Bank, IBM showcases the significant improvements AI brings to application management and modernization efforts. Overall, IBM asserts that AI enhances rather than undermines its mainframe capabilities.
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