“When you look at 2026, we set about a point growth in margin. Gonna get about a half a point out of revenue scale just given the leverage of the acceleration of revenue.”

In context

“hree to four years. Portfolio we drive this through portfolio mix, That's why software being the underpinning of IBM's leverage around 45% of IBM's revenue, but about two-thirds of our profit. Also, high-value recurring revenue, our ARR book of business, high marginal profit dollars. So portfolio mix being one lever, productivity, every dollar we invest in this company around go-to-market around R&D, around innovation, and around our consulting services, we look and we drive a very maniacal ROI concept around that profile just as you would expect us to as an investor like an inorganic M&A acquisition. And three, we drive to bring this company the most productive company in the world and getting G&A scale leverage overall. Fundamentally, you manage those three separate buckets differently. When you look at 2026, we set about a point growth in margin. Gonna get about a half a point out of revenue scale just given the leverage of the acceleration of revenue. We will lose a half a point on portfolio mix because we are gonna wrap on an unprecedented launch momentum on mainframe. Which carries higher prior profit and higher mix. The remaining full point basically is gonna be driven out of productivity. And our model, as you know quite well, we've been driving north of 300 points per year of productivity, and we've been reinvesting about 200 basis points of that. That's why you've seen over the last handful of years, our R&D up double-digit growth year over year. And we've taken over the last what, five years, we've taken $2.5 billion of R&D up overall. But when you look at 2026, productivity is gonna drive the day, We feel confident. We took up our productivity target to $5.5 billion. We will get revenue scale leverage on G&A. Which will mitigat”