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IBM shares plunge 25% after earnings miss sparks 401(k) losses
IBM stock fell more than $73 on July 14, cutting value for about 150,000 employees invested through the company 401(k).
IBM shares sank 25% on July 14, logging the worst share day in the company’s history after the latest earnings update, according to Yahoo Finance. The outlet said IBM reported $12.3 billion in revenue in an early second-quarter earnings announcement, which came in $660 million below projections. Adjusted earnings per share also missed expectations by 8 cents, driving the selloff. Yahoo Finance added that the drop translated into collective losses of roughly $400 million for IBM employees holding company stock inside their 401(k) plans, including an estimated 150,000 workers. The article noted the losses are not a substantial portion of the estimated $59 billion total value of the IBM 401(k) plan. The piece also highlighted the risk of concentrating too much in one company, citing MarketWatch experts who warned against letting “corporate loyalty” override financial judgment and stressed diversification limits such as keeping at most 25% in any one sector and 5% in any single position.