IBM Timeline

IBM 45

1911 Computing-Tabulating-Recording Company founded The Computing-Tabulating-Recording Company (CTR) is incorporated on 16 June 1911 in Endicott, New York — a merger of four companies including the Tabulating Machine Company (founded by Herman Hollerith, inventor of the punch card tabulating machine used in the 1890 US Census) and the International Time Recording Company. CTR manufactures tabulating machines, time recorders, meat slicers and cheese slicers. It employs 1,300 people. Nobody at the founding could imagine it becoming the world's dominant computing company.
1914 Thomas Watson Sr. becomes general manager Thomas J. Watson Sr. joins CTR as general manager in 1914, hired from the National Cash Register Company where he had worked under the legendary John Henry Patterson. Watson is a salesman and motivator of extraordinary ability. He institutes the IBM culture: white shirts, dark suits, THINK signs on every wall, company songs, a fanatical customer-service ethos and a sales force trained with almost military discipline. His impact on IBM's corporate culture is so profound that elements of it persist a century later.
1924 CTR renamed International Business Machines Thomas Watson renames the Computing-Tabulating-Recording Company to International Business Machines Corporation on 14 February 1924 — a name that projects global ambition far beyond the company's current size. IBM at the time has revenues of $11 million and 3,000 employees. The name change signals Watson's determination to build a global enterprise. The IBM acronym and the associated culture of professionalism, reliability and customer service will define the company for a century.
1928 IBM punch card — the 80-column standard IBM introduces the 80-column punch card in 1928 — a seemingly small technical decision with enormous consequences. The 80-column format becomes the universal standard for data storage and input for the next five decades. When computer terminals replace punch cards in the 1970s and 1980s, screens are designed with 80-character line widths to match the punch card standard. The legacy persists in the default terminal width of 80 characters used in software development to this day.
1935 Social Security — IBM processes America IBM wins the contract to process Social Security records for the US government in 1935 — one of the largest data processing challenges in history. The Social Security Act requires tracking employment records for 26 million Americans. IBM tabulating machines, operated by thousands of workers in Endicott, New York, process the data. The contract establishes IBM's relationship with government as its most important customer and demonstrates that IBM's machines can handle national-scale administrative challenges.
1944 Harvard Mark I — first large-scale automatic calculator IBM funds and builds the Harvard Mark I — formally the IBM Automatic Sequence Controlled Calculator — unveiled at Harvard University in 1944. Designed by Howard Aiken, it is 51 feet long, 8 feet tall and weighs 10,000 pounds. It can perform three additions per second and multiply two 23-digit numbers in about 6 seconds. The Mark I is used by the US Navy for ballistic calculations during World War II. It is not electronic — it uses electromechanical relays — but it establishes IBM's identity as a computing company.
1952 Thomas Watson Jr. takes over — electronic era begins Thomas Watson Jr. succeeds his father as CEO of IBM in 1952, having served as a bomber pilot in World War II. The younger Watson sees the electronic computer as the future of IBM and bets the company on it — against his father's preference for electromechanical tabulating machines. Watson Jr.'s most consequential decision is the IBM 701 scientific computer (1952) and subsequently the IBM 650 (1954) — IBM's first mass-produced computer, renting for $3,500 per month. Fortune later calls Watson Jr.'s bet on electronics 'the greatest capitalist achievement of the twentieth century.'
1956 IBM consent decree — antitrust settlement IBM settles an antitrust case with the US Department of Justice in 1956, agreeing to sell (not just lease) its tabulating machines and computers. Before the consent decree, IBM leased virtually all its equipment — customers could never own an IBM machine. The settlement forces IBM to change its business model but also accidentally creates the market for used IBM equipment and the third-party service industry. The 1956 consent decree is one of several antitrust actions that shape IBM's history.
1957 IBM FORTRAN — first high-level programming language IBM releases FORTRAN (FORmula TRANslation) in 1957 — the world's first widely used high-level programming language, developed by a team led by John Backus. Before FORTRAN, programmers wrote in machine code or assembly language — tedious, error-prone and machine-specific. FORTRAN allows scientists and engineers to write programs in mathematical notation. It is still used in scientific computing today. IBM's development of FORTRAN is one of the most consequential contributions to computer science in history.
1960 IBM 1401 — the computer that ran the world The IBM 1401, introduced in 1959 and dominant through the early 1960s, becomes the most popular computer in the world — with 12,000 units installed by 1961, representing more than half of all computers in operation globally. The 1401 is a transistorised business computer that processes payroll, billing, inventory and accounting for banks, insurance companies and manufacturers. It transforms business data processing from a luxury to a standard corporate function. IBM's dominance of business computing is now absolute.
1964 System/360 — the greatest product gamble in business history IBM announces the System/360 on 7 April 1964 — a family of six compatible computers covering a 50:1 range of performance. The System/360 is the most ambitious product launch in corporate history: IBM invests $5 billion — more than the Manhattan Project — betting that customers will pay for compatibility across machine sizes. Fortune calls it 'IBM's $5,000,000,000 Gamble.' The gamble pays off completely: the System/360 architecture becomes the template for business computing for the next three decades. Every IBM mainframe since is compatible with System/360 software.
1969 IBM unbundles software — an industry is born IBM announces on 23 June 1969 that it will 'unbundle' software — charging separately for software and services rather than including them with hardware. The decision, made partly to ward off another antitrust action, accidentally creates the independent software industry. Before unbundling, software was given away with IBM hardware; after unbundling, independent companies can charge for software on IBM machines. The decision is the origin of Microsoft, Oracle, SAP and every other enterprise software company.
1969 IBM and the moon landing IBM computers are central to NASA's Apollo programme. IBM's System/360 computers process the telemetry data from Apollo missions; IBM engineers at the NASA Mission Control Center in Houston monitor every aspect of the lunar flights. The Saturn V rocket's guidance computer is partly designed with IBM expertise. When Neil Armstrong lands on the Moon on 20 July 1969, IBM computers are running the mission. The Apollo programme is IBM's most visible public achievement.
1970 IBM antitrust case — 13 years of litigation The US Department of Justice files an antitrust suit against IBM on 17 January 1969, alleging it monopolises the computer industry. The case is the longest antitrust litigation in US history — the government finally drops it in January 1982 after 13 years, declaring it 'without merit.' But the threat of breakup constrains IBM's behaviour throughout the 1970s and contributes to its fateful decision to use outside suppliers (Microsoft, Intel) for the IBM PC rather than developing proprietary technology that might invite further antitrust action.
1973 IBM Winchester hard drive — mass storage revolution IBM introduces the Winchester hard disk drive in 1973 — the design that becomes the standard for all hard disk drives for the next four decades. The Winchester's sealed head-disk assembly, with read/write heads flying nanometres above the disk surface on an air cushion, allows far higher storage densities than previous designs. IBM's hard drive research is among its most consequential: virtually every personal computer, server and storage system built before the flash memory era contains a Winchester-derived hard drive.
1977 IBM revenues exceed $18 billion — peak dominance IBM's revenues exceed $18 billion in 1977 — making it not just the world's largest technology company but one of the largest companies of any kind. IBM's market share in mainframe computers exceeds 70%. The 'IBM-compatible' standard defines the computing industry. IBM's research laboratories — Yorktown Heights, Almaden, Zurich — are among the most productive in science, producing six Nobel Prize winners between 1973 and 1987. IBM is at the absolute zenith of its power.
1981 IBM licenses DOS from Microsoft — the decision that made Bill Gates IBM licenses the operating system for the IBM PC from a small Seattle company called Microsoft, paying a one-time fee of approximately $50,000 for a non-exclusive licence. Microsoft, led by 25-year-old Bill Gates, retains the right to license the same software (MS-DOS) to other PC manufacturers. IBM's lawyers, worried about antitrust scrutiny, accept the non-exclusive deal. It is the most consequential licensing decision in corporate history: it allows clone PC makers to use Microsoft's DOS, establishes Microsoft's monopoly position and eventually makes Bill Gates the world's richest person.
1981 IBM PC — the machine that defined personal computing IBM announces the IBM Personal Computer (model 5150) on 12 August 1981, using an Intel 8088 processor and Microsoft DOS operating system — both sourced from outside suppliers in an unprecedented departure from IBM's vertically integrated model. The decision to use outside suppliers and publish an open architecture is made partly to move fast (the PC is developed in just 12 months) and partly to avoid antitrust scrutiny. The IBM PC defines the personal computer standard; within two years it has 75% market share. It also contains the seeds of IBM's eventual decline: competitors can clone it.
1982 IBM PC clones emerge — Compaq leads the way Compaq Computer releases the first IBM PC clone in 1982 — a fully IBM-compatible personal computer that runs the same software. Because IBM published its PC's architecture openly and used standard components (Intel chips, Microsoft DOS), any company can legally build an IBM-compatible PC. Within three years, hundreds of clone manufacturers emerge. IBM's PC market share falls from 75% in 1982 to 26% in 1986. The open architecture that allowed rapid market adoption also allows IBM to be commoditised out of the market it created.
1984 IBM PCjr — the most humiliating product failure IBM launches the PCjr in November 1983 — a home computer intended to extend IBM's PC franchise to the consumer market. The PCjr has a 'chiclet' keyboard universally derided as unusable, limited memory that prevents it running standard IBM PC software, and a price point that undercuts neither Apple nor the IBM PC. It sells poorly from launch and is discontinued in March 1985 after barely 18 months. The PCjr is IBM's most visible product failure and a sign that the company is losing its touch in consumer markets.
1986 IBM PC/AT and Intel 286 — the standard extends The IBM PC/AT (Advanced Technology), introduced in 1984, uses Intel's 80286 processor and becomes the template for the next decade of personal computing. The AT bus (later called ISA) becomes the expansion card standard for all PC-compatible computers. IBM's influence on PC standards remains enormous even as clone makers erode its market share. IBM still defines what 'IBM-compatible' means, and the entire PC industry must maintain compatibility with IBM's architecture decisions.
1987 IBM PS/2 and OS/2 — attempt to reclaim the PC IBM launches the PS/2 personal computer and OS/2 operating system in 1987 — an attempt to reassert control over the PC standard by introducing proprietary interfaces (Micro Channel Architecture) and a new operating system developed jointly with Microsoft. The strategy fails: clone makers refuse to pay IBM's MCA licensing fees and continue with the older ISA standard; Microsoft eventually abandons OS/2 to focus on Windows. IBM's attempt to proprietary-ise the PC it opened fails completely.
1990 IBM revenues peak at $69 billion IBM's revenues peak at $69 billion in 1990 — the largest revenues of any company in the world. IBM employs 374,000 people. Its mainframe business remains enormously profitable; its PC business is large but losing market share rapidly. The cracks in IBM's business model are not yet visible in the revenue numbers, but the company's management is beginning to appreciate that its vertically integrated model — building everything from chips to software to services — is being undermined by the open PC standard it created.
1992 IBM near-bankruptcy — $8 billion loss IBM posts an $8 billion loss in 1992 — the largest loss in corporate history at that time. The PC clone market has devastated IBM's hardware margins; mainframe revenues are declining as clients migrate to cheaper UNIX servers; the company is too large, too bureaucratic and too slow. IBM's board fires CEO John Akers. The company considers breaking itself up into separate divisions. IBM's near-death experience is the most dramatic corporate crisis in American technology history.
1993 Lou Gerstner becomes CEO — IBM is not broken up Lou Gerstner, a former McKinsey consultant and RJR Nabisco CEO with no technology background, is appointed IBM CEO in April 1993. His first and most important decision: he refuses to break IBM up, despite pressure from shareholders and analysts. 'The last thing IBM needs right now is a vision,' he famously says — what it needs is execution. Gerstner cuts 35,000 jobs, reduces costs by $8 billion and pivots IBM toward services. His tenure is the greatest corporate turnaround in American business history.
1994 IBM Global Services — the services pivot IBM formalises its services strategy with the creation of IBM Global Services in 1992–1994 — a division offering IT consulting, systems integration and outsourcing to large corporations. The strategy is elegant: IBM's deep knowledge of corporate computing, built over decades of selling and servicing mainframes, is more valuable than the hardware itself. IBM wins a 10-year, $3.5 billion IT outsourcing contract with Xerox in 1994 — the largest IT services deal in history at the time. IBM Global Services becomes the world's largest IT services organisation.
1996 Deep Blue defeats Garry Kasparov IBM's Deep Blue chess computer defeats world chess champion Garry Kasparov in a six-game match in May 1997 — the first time a computer defeats a reigning world chess champion under standard tournament conditions. (Deep Blue lost the first match in 1996; it wins the rematch in 1997.) The victory is a global sensation and IBM's most dramatic demonstration of computing power since the Apollo programme. Kasparov accuses IBM of cheating; IBM denies it and declines to play a rematch. Deep Blue is retired after the 1997 match.
1999 IBM sells PC manufacturing to focus on services Under Gerstner's successor Sam Palmisano, IBM accelerates the exit from hardware. The clearest signal: IBM sells its PC division — including the ThinkPad laptop brand — to Chinese company Lenovo for $1.75 billion in 2004. The ThinkPad, introduced in 1992, is the finest business laptop ever made and one of the most beloved product lines in IBM's history. Its sale to Lenovo marks IBM's formal exit from the consumer hardware market it created. Lenovo continues the ThinkPad brand to this day.
2001 Sam Palmisano becomes CEO — On Demand strategy Sam Palmisano succeeds Lou Gerstner as IBM CEO in 2002 and articulates an 'On Demand' strategy — the idea that IBM will help corporations access computing resources as they need them, rather than owning large fixed installations. The On Demand concept anticipates cloud computing by nearly a decade. Palmisano also oversees IBM's acquisition of PwC Consulting for $3.5 billion in 2002 — the largest acquisition in IBM's history at the time — dramatically expanding IBM's consulting capabilities.
2004 IBM sells ThinkPad to Lenovo IBM sells its Personal Computing Division — including the iconic ThinkPad laptop brand — to Lenovo for $1.75 billion in December 2004, completed in May 2005. The ThinkPad, introduced in 1992 with its distinctive black case and red TrackPoint, is the finest business laptop ever made. Its sale symbolises IBM's transformation from a hardware company to a services and software company. IBM retains an 18.9% stake in Lenovo as part of the deal. The ThinkPad name and design language continue under Lenovo.
2005 IBM patent leadership — most US patents for 12 consecutive years IBM receives 2,941 US patents in 2005 — the most of any company in the United States — and has held the top position for 12 consecutive years. IBM's patent portfolio generates over $1 billion in annual licensing revenue. IBM researchers publish more scientific papers than most universities. The research investment that Thomas Watson Sr. began in the 1930s produces a continuous stream of fundamental innovations: DRAM, the relational database, the RISC processor, magnetic storage, fibre optics communications — all invented or significantly advanced at IBM.
2008 Smarter Planet — IBM reinvents its identity IBM launches its 'Smarter Planet' marketing campaign in 2008, positioning IBM as the company that will apply intelligence and analytics to the world's infrastructure — power grids, water systems, traffic, healthcare, food supply. The campaign is one of the most successful corporate rebrandings in history, repositioning IBM from a stodgy mainframe company to a visionary analytics business. Smarter Planet generates enormous brand value and opens new business conversations with governments and infrastructure operators.
2009 IBM acquires Sun Microsystems — loses to Oracle IBM engages in serious negotiations to acquire Sun Microsystems in early 2009 for approximately $7 billion, before Oracle swoops in with a successful $7.4 billion bid. The failed Sun acquisition is a significant strategic setback: Sun's Java platform, Solaris operating system and SPARC processors would have given IBM powerful software assets. Oracle, which wins Sun, uses Java and Solaris to strengthen its database and cloud business. IBM misses a transformative acquisition.
2011 Watson wins Jeopardy! — AI arrives IBM's Watson computer defeats Jeopardy! champions Ken Jennings and Brad Rutter in a televised match on 14–16 February 2011 — the most watched demonstration of artificial intelligence in history. Watson processes natural language questions, searches its knowledge base and buzzes in with answers faster than the human champions. Ken Jennings writes on his Final Jeopardy answer: 'I for one welcome our new computer overlords.' The Jeopardy! victory launches IBM's Watson AI brand and announces the era of cognitive computing.
2012 Ginni Rometty becomes CEO — first woman to lead IBM Virginia 'Ginni' Rometty succeeds Sam Palmisano as IBM CEO on 1 January 2012 — the first woman to lead IBM in its 100-year history. Rometty articulates a strategy around cloud, analytics, mobile, social and security — the 'strategic imperatives' that IBM believes will drive future growth. She faces the challenge of growing new businesses fast enough to offset the secular decline in IBM's legacy hardware and services revenue. IBM's revenues begin a remarkable 22-consecutive-quarter decline starting in 2012.
2014 IBM sells x86 server business to Lenovo IBM sells its x86 server business — including the System x line of Intel-based servers — to Lenovo for $2.3 billion in January 2014, completed in October 2014. The sale follows the ThinkPad divestiture and continues IBM's exit from commodity hardware. IBM retains its high-end Power Systems and mainframe businesses — products that compete on performance rather than price. The x86 server sale reduces IBM's revenues but improves its margins and strategic focus on software and services.
2015 Watson Health — AI meets medicine IBM launches Watson Health in 2015, applying Watson's natural language and machine learning capabilities to oncology, genomics and clinical decision support. IBM partners with Apple, Johnson & Johnson and Medtronic. Watson for Oncology, developed with Memorial Sloan Kettering Cancer Center, aims to recommend cancer treatments based on medical literature. The initiative generates enormous publicity but ultimately disappoints: Watson's clinical recommendations prove unreliable, and IBM writes down Watson Health before eventually selling it in 2022.
2016 IBM quantum computing — first public quantum computer IBM makes a 5-qubit quantum computer available via the cloud in May 2016 — the first time anyone can access a real quantum computer without owning one. The IBM Quantum Experience allows researchers, students and developers to run experiments on real quantum hardware. IBM expands its quantum systems to 27 qubits (2019), 65 qubits (2020) and 433 qubits (2022). IBM's quantum programme is the most open and accessible in the world and positions IBM as the leader in practical quantum computing.
2018 IBM acquires Red Hat for $34 billion IBM announces the acquisition of Red Hat — the world's largest open-source software company and provider of the Red Hat Enterprise Linux platform — for $34 billion on 28 October 2018. It is the largest acquisition in IBM's history and the third-largest technology acquisition ever. Red Hat's hybrid cloud platform, OpenShift, gives IBM a credible cloud strategy and access to the open-source developer community that IBM's proprietary culture had never penetrated. The Red Hat acquisition is IBM's most consequential strategic move since Gerstner's services pivot.
2020 Arvind Krishna becomes CEO — hybrid cloud focus Arvind Krishna, an IBM Research veteran who led the Red Hat acquisition, becomes IBM CEO in April 2020. He immediately articulates a focused strategy: IBM will be the hybrid cloud and AI company for enterprise clients. In October 2020 he announces the spinoff of IBM's managed infrastructure services division — the legacy IT outsourcing business — into a separate company called Kyndryl. The spinoff, completed in November 2021, is the largest in IBM's history and removes $19 billion in low-margin revenue.
2021 Kyndryl spinoff — IBM simplifies IBM completes the spinoff of Kyndryl — its managed infrastructure services division — on 3 November 2021, listing it as an independent company on the NYSE. Kyndryl begins with $19 billion in revenues and 90,000 employees, making it one of the world's largest IT services companies. For IBM, the spinoff removes the legacy services business that was dragging down growth and margins, leaving a more focused company oriented around hybrid cloud (Red Hat/OpenShift) and AI.
2022 IBM 433-qubit quantum processor IBM unveils the Osprey quantum processor with 433 qubits in November 2022 — more than tripling its previous record. IBM's quantum roadmap targets 100,000 qubits by 2033. While quantum computers cannot yet outperform classical computers on practical business problems, IBM's systematic progress on qubit count, coherence times and error correction demonstrates genuine engineering advancement. IBM Quantum Network has over 200 member organisations including Fortune 500 companies, national laboratories and universities.
2023 IBM watsonx — enterprise AI platform IBM launches watsonx — a new AI and data platform — in May 2023 at its Think conference. watsonx.ai provides foundation models and machine learning tools for enterprise use; watsonx.data is a hybrid data store; watsonx.governance provides AI governance and risk management. Unlike consumer AI tools, watsonx is designed for regulated industries — banking, healthcare, government — where auditability, explainability and data privacy are paramount. IBM positions itself as the enterprise AI company for businesses that cannot use public AI models.
2024 IBM acquires HashiCorp for $6.4 billion IBM announces the acquisition of HashiCorp — maker of Terraform, the leading infrastructure-as-code platform — for $6.4 billion in April 2024. HashiCorp's tools are used by hundreds of thousands of developers to manage cloud infrastructure across AWS, Azure and Google Cloud. The acquisition strengthens IBM's hybrid cloud platform and gives Red Hat deeper integration with the developer toolchains that manage modern cloud infrastructure. IBM continues to build out its hybrid cloud ecosystem through acquisitions.
2025 IBM — 114 years and still transforming IBM enters 2025 as a focused hybrid cloud and AI company with approximately $60 billion in annual revenues, 280,000 employees and the most extensive quantum computing programme in the world. From Herman Hollerith's punch card tabulating machines to Watson defeating Jeopardy! champions to watsonx's enterprise AI platform — no technology company has survived more technological transitions or reinvented itself more dramatically. IBM's longevity is a testament to its research culture, its deep enterprise relationships and its repeated willingness to cannibalise its own business before competitors do it.