IBM Stock Plummets 13% After AI Company Claims It Can Replace Legacy Systems

International Business Machines saw its worst single-day stock decline in over two decades Monday following an announcement from AI startup Anthropic. The company said its new technology can quickly modernize old computer programming systems that IBM has traditionally serviced.

International Business Machines experienced its worst single-day stock performance in more than two decades Monday, plummeting 13.2% after artificial intelligence company Anthropic announced technology that could replace traditional IBM services.

The massive selloff represents IBM’s largest daily decline since October 18, 2000, triggered by Anthropic’s announcement that its Claude Code technology can modernize COBOL programming systems.

COBOL represents a decades-old computer programming language that runs extensively on IBM’s mainframe computers, particularly within banking institutions, insurance companies, and government agencies.

According to Anthropic’s Monday blog announcement, traditional COBOL system updates previously demanded extensive consultant teams working for multiple years to map complex workflows. The company stated that its Claude Code technology can now handle the exploration and analysis work that typically consumes the majority of modernization efforts.

“With AI, teams can modernize their COBOL codebase in quarters instead of years,” the startup explained in its announcement.

The broader software industry has faced significant pressure in recent months as investors grow increasingly concerned about artificial intelligence capabilities potentially disrupting established technology companies, especially following Anthropic’s expansion of its Claude language model through new plug-in applications.

Other technology stocks also suffered Monday, with cybersecurity firms like CrowdStrike and Datadog declining as market participants evaluated how Anthropic’s new security applications might affect their business prospects.