The Value of This Tech Brand Is Diving

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Most major tech brands have risen in value recently, along with the earnings of their parent companies and a growth in customers. Among the best examples are Microsoft, Apple and Amazon. However, one of the most famous tech brands in the world is losing ground fast.

In a new brand study, the value of Amazon rose 52% to $316 billion, making it the most valuable brand in the world. The survey, conducted for the BrandZ Top 100 Most Valuable Global Brands, put Apple next, up 3% to $310 billion. It was followed by Google. Its brand value rose 2% to $309 billion. Microsoft’s brand value was 25% higher to $251 billion. One of the few brands in the entire study that lost ground was IBM. Its brand value fell 11% to $86 billion.

International Business Machines Corp. (NYSE: IBM) has been troubled for some time. Its revenues have fallen in most quarters for the past six years. In fact, its quarterly top line was down 22 quarters in a row through the end of 2017. IBM has tried to evolve from a public corporation driven mostly by hardware and traditional software sales to one driven by artificial intelligence and cloud computing. It has even created a new brand for many of these initiatives: Watson. This has partially left the IBM brand behind. Thomas Watson and his son Thomas Watson Jr. ran IBM for almost the entire period from 1914 until 1971. The current CEO, Virginia Marie “Ginni” Rometty, has been a disappointment to investors for years.

One of the aspects of the Most Valuable Brand survey is what the brand does to help the value of the company. In the past five years, IBM’s stock is off 25% while the value of the Nasdaq is up by 79%.

IBM has largely lost the race in the artificial intelligence and cloud business to leaders like Amazon and Microsoft. Given the lead these companies have, IBM almost certainly can’t close that gap. The sales of its big, expensive hardware, which were once the heart of the company, have fallen. This firm gambled unsuccessfully on a turnaround strategy, and its brand value has suffered accordingly. Several huge tech companies are among those with the best reputations in America. IBM is not among them.


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