International Business Machines Corp, which is moving steadily into higher-margin businesses such as software and cloud computing, reported a worse-than-expected 4 percent dip in third-quarter revenue, its sixth straight quarterly decline.
Much of that came from a 17 percent slide in overall hardware. Profitability in that business declined by $1 billion so far this year.
At least eight brokerages cut their price targets on the stock by as much as 9.5 percent to between $160 and $220, while analysts at UBS Investment Research downgraded the stock to "neutral" from "buy.
The latest quarterly disappointment deals another blow to Chairman and CEO Ginni Rometty in her first year as head of the board. Including Thursday's plunge, IBM's stock has slid 15 percent since she stepped up as chairman versus the S&P 500's 18 percent gain.
"We are concerned about future earnings power. IBM has been successful in multiple computing waves in the past but we believe the execution issues combined with the weak IT spending environment will hold back any potential revenue growth," UBS analysts said in a note to clients.