AI, data and credit drive diverse Q4 earnings

Tech and financial names report AI- and data-led growth

Recent earnings calls from IBM, Lam Research, LendingClub and Deluxe show broad-based growth tied to artificial intelligence, data and disciplined credit. The companies reported strong 2025 results and set out 2026 targets that emphasize recurring revenue, productivity and balance sheet strength. Management commentary across the calls pointed to resilient demand in core end markets, with differing exposure to enterprise software, semiconductor equipment, consumer credit and payments.

IBM and Lam Research highlighted AI as both a demand driver and an internal productivity tool, while Deluxe and LendingClub focused on data analytics and underwriting advantages. All four companies raised or reiterated guidance for 2026 that implied higher earnings or free cash flow versus 2025, with several planning incremental investment in technology, marketing or capacity while maintaining shareholder return programs.

IBM: software-led model, AI and Confluent deal

IBM reported 6% revenue growth for 2025 and $14.7 billion of free cash flow, its highest cash generation in more than a decade. Software now represents about 45% of the business, up from roughly 25% in 2018, and software revenue grew 9% for the year and 11% in the fourth quarter. Software annual recurring revenue reached $23.6 billion, more than $2 billion above year-end 2024, with data up 19%, automation up 14%, and Red Hat up 8% in the quarter.

IBM’s cumulative generative AI book of business exceeded $12.5 billion, including more than $10.5 billion in Consulting and over $2 billion in Software. Management said this will be the last quarter AI is reported as a separate metric because it is now embedded across the business. For 2026, IBM guided to more than 5% constant-currency revenue growth, about $15.7 billion of free cash flow, and roughly 10% Software growth. The company expects to absorb about $600 million of dilution from the planned Confluent acquisition in 2026, while targeting Confluent to be accretive to adjusted EBITDA in its first full year and to free cash flow in year two.

IBM also cited productivity initiatives, including Project Bob, an AI-based software development system used by more than 20,000 employees, which has produced reported average productivity gains of 45%. Annual run-rate productivity savings exited 2025 at $4.5 billion, with an additional $1 billion targeted in 2026, taking projected savings to $5.5 billion by year-end 2026. Operating pre-tax margin expanded 100 basis points in 2025, and IBM indicated it aims to expand that margin by about another point in 2026.

Lam Research: record tools demand and fab constraints

Lam Research closed 2025 with record annual revenue of $20.6 billion, up 27% year over year, and record gross margin of 49.9%. The December quarter marked Lam’s 10th consecutive quarter of revenue growth, with sales of $5.34 billion and non-GAAP gross margin of 49.7%, both ahead of guidance. Diluted non-GAAP EPS for 2025 was $4.89, up 49% from the prior year, and operating margin reached 34.1%.

Management linked results to AI-related semiconductor demand and estimated wafer fab equipment spending at about $110 billion in 2025, with an initial 2026 view around $135 billion. Executives said growth is being constrained by shortages of clean room space and expect both WFE and Lam’s business to be weighted to the second half of 2026. Foundry customers accounted for 59% of December-quarter systems revenue, up from 35% a year earlier, while memory was 34% with record DRAM revenue driven by high-bandwidth memory and node migrations. Lam’s Customer Support Business Group generated about $2.0 billion in December-quarter revenue, up 14% year over year, primarily on spares growth.

Lam highlighted momentum for its Acara conductor etch system, which doubled its installed base over the past year and secured production tool-of-record positions in advanced DRAM and foundry logic. The company expects its advanced packaging business to grow more than 40% in 2026, supported by leadership in electroplating and TSV etch for HBM4 and HBM4E. For the March 2026 quarter, Lam guided to $5.7 billion in revenue plus or minus $300 million, gross margin of 49% plus or minus one point, and EPS of $1.35 plus or minus $0.10.

LendingClub: originations rebound and move to fair value

LendingClub reported what its CEO called one of the best years in the company’s history, with 2025 loan originations up 33% to nearly $10 billion and fourth-quarter originations up 40% year over year to $2.6 billion. Marketplace revenue rose 36% in the quarter on higher marketplace volumes and improved loan sales pricing, while non-interest income climbed 38% to $103 million. Net interest income increased 14% to $163 million, an all-time high, and net interest margin was 6%, 56 basis points above the prior year.

Full-year diluted EPS more than doubled to $1.16, with net income of $136 million and ROTCE of 10.2%; fourth-quarter ROTCE was nearly 12%. Management emphasized credit performance, citing delinquency and charge-off metrics well below its competitive set and an 80-basis-point year-over-year improvement in the net charge-off ratio. Provision for credit losses was $47 million in the quarter, reflecting disciplined underwriting, and the bank’s assets reached $11.6 billion, with deposits of $9.8 billion, both up high single digits year over year.

LendingClub will adopt the fair value option for all new held-for-investment loans in 2026. Executives said this is intended to remove the front-loaded CECL impact, better align revenue and loss timing, and create a consistent framework across its marketplace and bank activities. Under fair value, there will be no day-one loan loss provision on new originations, though the legacy CECL portfolio is expected to generate about $10 million of CECL expense in first-quarter 2026. For 2026, LendingClub guided to full-year originations of $11.6–$12.6 billion, up 21–31%, and diluted EPS of $1.65–$1.80, up 42–55% year over year, assuming a stable macro environment.

Deluxe: payments and data near parity with print

Deluxe reported 2025 total revenue of $2.133 billion, up 0.5% reported and 1.1% on a comparable adjusted basis. Comparable adjusted EBITDA rose 6.2% to $431.5 million, with margin expanding 90 basis points to 20.2%, and comparable adjusted EPS increased 12.6% to $3.67. Free cash flow was $175.3 million, up from $100 million in 2024, helped by lower restructuring spend, higher EBITDA, working capital efficiency and lower cash taxes.

Payments and Data lifted their share of revenue to 47% in 2025 from 43% a year earlier, and management expects these businesses to reach parity with Print in 2026. The Data segment produced revenue of $307.3 million, up 31.3%, with adjusted EBITDA of $86.4 million and a 28.1% margin. Merchant Services revenue grew 3.8% to $398.6 million with 9.4% adjusted EBITDA growth, while B2B Payments revenue rose 0.9% to $290.5 million and delivered 12.8% adjusted EBITDA growth. Print revenue declined 5.7% to $1.14 billion, in line with an expected secular decline profile, but segment margin remained in the low 30s and improved by 100 basis points.

For 2026, Deluxe guided to revenue of $2.11–$2.175 billion, adjusted EBITDA of $445–$470 million, adjusted EPS of $3.90–$4.30, and free cash flow of about $200 million. Segment assumptions include mid‑single‑digit Merchant revenue growth, low single‑digit B2B growth, mid‑ to high‑single‑digit Data growth, and low‑ to mid‑single‑digit Print declines. The company is rolling out AI across marketing, lockbox operations and customer service, completed two small acquisitions including CheckMatch, and expects an ISO residual purchase to lift Merchant Services margins by up to 200–300 basis points. Net debt was reduced by $76.2 million in 2025 to $1.39 billion, bringing net debt to adjusted EBITDA down to 3.2x.