• IBM’s CEO released a letter to shareholders on Tuesday to warn about a “performance shortfall.”
• The revenue miss renewed fears about a SaaSpocalypse.
• We gathered what business and tech leaders are saying about the letter — and its wider impact.

IBM is on pace to have its worst day ever on the stock market after saying it misread the AI spending boom.

On Tuesday, eight days before the company’s scheduled earnings call, CEO Arvind Krishna released a letter to shareholders that detailed a quarterly “performance shortfall,” including slimmer-than-expected revenue.

“While we anticipated some supply chain related impact in our expectations, we did not anticipate the magnitude of the capex reprioritization,” he wrote. “In addition, clients were distracted with rapidly-evolving, industry-wide cybersecurity concerns in the quarter.”

The warning quickly revived talk of a SaaSpocalypse — the fear that AI will erode the value of some traditional software companies. For months, investors have worried that businesses will need fewer software subscriptions as AI agents automate and build custom tools.

IBM is not a pure software-as-a-service company, and Krishna did not say AI had made its products obsolete. Instead, he said customers redirected spending toward increasingly expensive servers, storage, and memory — leaving less money available for some of IBM’s software and consulting services.

The shortfall is still touching a nerve among industry bigwigs. Companies are pouring money into the infrastructure needed to power AI, while investors increasingly question how much of that spending will ultimately flow to established software providers.

Here is what smart voices in business and tech are saying about the early announcement’s impact on the economy:

Chamath Palihapitiya — CEO at 8090 and Social Capital

Chamath Palihapitiya said IBM’s stumble reflects a much bigger problem facing the AI industry: Companies selling intelligence are making enormous sums, but it’s unclear whether their customers can turn those costs into profits of their own.

“The downstream ecosystem has to make money as well,” Palihapitiya said Tuesday when asked about Krishna’s letter on CNBC. “And then, the ultimate buyer of these tokens also has to make money.”

He stopped short of blaming IBM’s problems on its pivot to AI and cloud computing, and praised Krishna for repositioning the company.

Palihapitiya was less forgiving of IBM’s suggestion that rapidly evolving cybersecurity concerns distracted some customers during the quarter.

He said AI companies and their investors have repeatedly swung between extremes: describing the technology as an all-powerful breakthrough when raising money, then warning that it poses an existential threat when seeking regulation.

Jacob Bourne — Analyst at EMARKETER

Bourne told Business Insider in an email that IBM was hit with a “triple whammy.”

He said the AI buildout is directing corporate spending toward hardware rather than software and services. At the same time, investors are punishing legacy companies that appear to be falling behind. Finally, AI-native challengers such as Anthropic are putting additional pressure on traditional software business models.

“We can expect more quarters like this one, but I think it’s a disruption story, not necessarily an extinction one for legacy software companies,” he wrote. “Spending patterns will shift from the present focus, and the vendors that adapt their products to the changing market will stay competitive.”

Nicholas Mugalli — CEO and Principal at World Trade Securities

Mugalli wrote on X that he believes IBM is the first major casualty of a broader shift in enterprise spending.

He argued that IBM’s miss shows the limits of corporate budgets. As hardware became scarcer and more expensive, executives prioritized servers, storage, and memory over software deals that could be delayed.

“This is the SaaS reckoning arriving exactly the way it would,” Mugalli wrote, “not with cancellations, but with deprioritization. “

Mugalli predicted IBM would not be the last enterprise software company to feel that pressure, pointing specifically to Palantir and ServiceNow.

Dan Niles — founder of Niles Investment Management

Niles wrote on X that IBM’s warning was an example of the AI “speed bump” he has been expecting.

He also said that customers redirected spending toward AI late in the quarter, cutting into IBM’s mainframe and related software business. He said that much of that revenue is supposed to be recurring, making the shortfall more concerning.

“Given software is a back-end loaded business, I doubt this is the last casualty,” he wrote.

• As more people use AI-powered tools for coding, it’s fueling growth in a new crop of companies.
• The CEO of vibe-coding startup Emergent joins BI Live to unpack the impact of AI tools, and how he hires.
• Join the conversation live on Wednesday at 11 a.m. ET. to ask your own questions about vibe coding.

As AI gets better and better at writing code, where does that leave software engineers? And, how does it impact the the companies they work for?

Business Insider set out to answer these questions with a multi-part series, The Great Coding Reset.

The fear that AI will make legacy software giants irrelevant has rattled markets. But the companies building vibe-coding tools have attracted big dollars, and seen their valuations skyrocket.

On Wednesday at 11 a.m. ET, Business Insider Today’s Dan DeFrancesco sits down with the CEO of one of these fast-growing startups.

Mukund Jha is CEO and co-founder of Emergent which launched in 2025. As of January 2026, the company has raised $100 million.

Tune in live to hear about his company’s exponential growth, what Jha looks for when hiring software engineers, and how vibe coding is changing his industry.

Join the conversation below to ask your own question and share your opinions on vibe coding.

• Disney’s new “Moana” movie fell flat in its box-office debut.
• The movie avoided controversy, but didn’t excite audiences.
• It also faced competition from “Toy Story 5” and “Minions & Monsters.”

“Moana” bellyflopped in its box-office debut, and the miss should provide Disney film executives with some hard-earned lessons.

Disney’s new live-action remake about the uber-popular Polynesian princess failed to bring audiences aboard, with a $43 million domestic opening that was only slightly above the disastrous start for the “Snow White” remake last year.

“‘Moana’s’ performance this weekend certainly has everyone questioning the animation-to-live-action strategy often employed by Disney,” said Paul Dergarabedian, the head of marketplace trends at media research firm Rentrak.

The Mouse House has used sequels and remakes as an easy, low-risk way to generate tons of cash, though a flop for one of its most popular movies means this strategy may be losing luster with fans.

“Disney invented this live-action phenomenon based on their animated films, and they’ve had remarkable success with them,” said box-office analyst David Gross in a Sunday report. “But this opening isn’t close to Disney’s past remakes.”

Unlike the ill-fated “Snow White” adaptation, this “Moana” movie had no notable controversies, and it didn’t make polarizing creative choices like last May’s successful “Lilo & Stitch” remake (which brought in over $182 million in the US in its debut).

Here are the three key reasons “Moana” sank in its box-office opening weekend, according to analysts.

1. It’s all too familiar

The new “Moana” is “an almost shot-for-shot (and line-for-line, in some cases) remake of a five-star masterpiece,” Business Insider’s Gabbi Shaw wrote in a review of the live-action remake.

By mimicking the original “Moana,” Disney avoided angering audiences who might not have wanted to see major changes to the hit. But by declining to reimagine “Moana,” the live-action remake may not have excited fans either.

“The central conundrum with all of these remakes,” Shaw wrote in her review, is that Disney fans or parents with Moana-crazed kids could have simply put on the “superior animated film” instead of bringing the whole family to a theater.

Though controversy-free, the new “Moana” movie was something that “nobody was talking about, for better or worse,” said box-office analyst Scott Mendelson.

2. Too much ‘Moana’

Disney may have given audiences another “Moana” movie too soon.

The original animated film came out 10 years ago, and Disney struck gold with a billion-dollar “Moana 2” sequel in 2024.

Although the “Moana” movies are beloved, as they consistently rank among the most-watched films on streaming, kids may already be getting their fix of the princess from the comfort of their couch.

“This story wasn’t ready to come back, and audiences are not rushing to see it,” Gross said.

Analyst Shawn Robbins, the director of movie analytics at Fandango, said the timing of this “Moana” film missed the sweet spot.

“This live-action take arrived at least half a decade too early if the goal was for the box office to benefit from nostalgia and a generational hand-me-down to kids who didn’t see the original film in theaters or weren’t born yet,” Robbins said.

3. It faced stiff competition, including friendly fire

Another factor in the “Moana” remake’s slow start was that there are plenty of family-friendly films in theaters right now.

“The marketplace is a bit oversaturated with PG-rated family fare,” Dergarabedian said.

Disney decided to release the new “Moana” three weeks after its own smash-hit “Toy Story 5” and a week after “Minions & Monsters” from Universal, though that film has so far slightly underwhelmed.

Those films and the World Cup may have kept audiences elsewhere, Robbins remarked.

However, seeing movies isn’t always a zero-sum game. Mendelson said that family-friendly hits can spur rival movies, since kids see trailers in theaters and get excited.

“If people had wanted to see ‘Moana,’ they would have seen ‘Moana,'” Mendelson said.

• Jamie Dimon said he’s not sure if he’ll be CEO in three years, weeks after the succession race heated up.
• Dimon said there’s little to no chance he’ll run for political office once he steps down.
• Instead, the 70-year-old said he’ll likely write a book, teach, or pursue media.

Last month, JPMorgan gave the world a better idea of who might succeed Jamie Dimon as CEO. And Dimon just gave a better idea of what he might do once that successor takes the job.

Dimon, who has led JPMorgan since 2006, said that in addition to doing business “with people I like,” he’ll probably write a book about management or the financial crisis. Known as one of Wall Street’s more outspoken CEOs, Dimon said he might take on public-facing roles, though he kept the details sparse.

“I may teach somewhere, because I like teaching, and I might do something around a media-related thing,” he told Axios in an interview that aired on Saturday.

Many have speculated that Dimon might have his eyes set on the White House, but he said there’s “pretty much no chance” he would run for office.

“I’m very hard-pressed to think I should be doing something like that,” he said with a light laugh, adding that he’s never been a part of a campaign. “I’m a banker. I’m a New Yorker. I’m 70 years old. I’ve had a couple of health problems.”

Dimon underwent emergency heart surgery in 2020 and battled throat cancer in 2014.

He added that politicians and their families face tremendous public scrutiny, and, besides, he could have a significant impact from his current position. Dimon has recently spearheaded geopolitical projects at JPMorgan, like a $1.5 trillion effort to boost US dominance and security, and a sweeping “American Dream Initiative.”

That doesn’t mean Dimon and his colleagues won’t also weigh in on political issues in the more traditional sense — JPMorgan launched a series called “From the desk of” in May, where senior leaders share their opinions on public policy.

Though it’s hard for some to imagine the end of the Dimon era at JPMorgan, a new leader may step up in the next few years. When asked whether he’ll still be CEO in three years, Dimon said he didn’t know, repeating his common refrain that it’s up to the board and that he plans to stay on as executive chairman. In the past, he’s been known for saying he’ll be in the job at least five more years.

Troy Rohrbaugh and Doug Petno recently emerged as the frontrunners to succeed Dimon after becoming co-presidents of JPMorgan in June.

• Jay-Z concluded his star-studded three-night residency at Yankee Stadium on Sunday.
• The final show, titled “Extra Innings,” featured musicians from across the rapper’s long career.
• Beyoncé, Usher, and Rihanna were among the guests brought onstage.

On Sunday, New York City’s Yankee Stadium was certainly a concrete jungle where dreams are made of — at least, for the thousands of Jay-Z fans who waited hours to see the rapper take the stage for the third and final night of his residency there.

A four-hour delay caused the show to kick off around 12:15 a.m., instead of the scheduled 8 p.m.

In a joint statement, Roc Nation and Yankee Stadium told Business Insider that “hundreds of individuals in large groups — who did not have tickets to tonight’s performance — stormed over peaceful ticketholders, and in some cases, breached security,” which led to the gates being closed for “an extended period of time.”

For many, it was worth the wait, as friends, family, and longtime collaborators joined one of New York City’s most beloved musicians onstage, including Beyoncé, Rihanna, Usher, Pharrell Williams, Jeezy, Fat Joe, and more.

Here are all the stars who showed up for Jay-Z’s third and final Yankee Stadium show.

Rihanna

Rihanna performed her song with Jay-Z, “Run This Town,” before launching into her own hit, “B**** Better Have My Money.”

Usher

Taking a quick break from his own tour, Usher stopped by Yankee Stadium to perform “Heart of the City (Ain’t No Love)” and “Throwback.”

Beyoncé

Mrs. Carter was on hand to perform one of their biggest hits as a couple, “Drunk in Love.”

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A post shared by Roc Nation (@rocnation)

Pharrell Williams and Malice

Williams performed a medley of songs, including “Excuse Me Miss,” “I Just Wanna Love U (Give It 2 Me),” and “Allure,” before bringing out his protégés, Clipse, the duo consisting of Malice, seen here, and Pusha T.

Pusha T

Pusha T and Malice, as Clipse, performed “Grindin’.”

Teyana Taylor

Taylor took over for Mary J. Blige in a performance of “Can’t Knock the Hustle.”

Jeezy

Jeezy joined Jay-Z onstage to perform two of their collaborations: “Seen It All” and “Go Crazy.”

Jermaine Dupri

Dupri rapped “Money Ain’t a Thang” with his longtime collaborator.

Fat Joe and Jadakiss

Knicks summer wouldn’t be complete without a performance of “New York” by these two.

The-Dream

The-Dream subbed in for Frank Ocean’s vocals on the chorus of “No Church in the Wild.”

Swizz Beatz

Swizz Beatz and HOV performed another long medley of some of their best work, including “On to the Next One,” “Ruff Ryder’s Anthem,” and “Welcome to the Jungle.”

• Meta announced that it is supercharging its Louisiana data center, known as Hyperion.
• The project has led to year-end bonuses of up to $50,000 for local teachers, Meta said.
• The campus will now grow to 5 gigawatts of compute capacity and cost more than $50 billion.

Meta is scaling up what was already slated to become its largest AI data center, a Louisiana campus that the tech giant says has fueled “life-changing returns” for local teachers and businesses.

The company behind Facebook and Instagram said in a blog post on Monday that the Richland Parish data center, known as Hyperion, will now grow to 5 gigawatts of compute capacity, bringing the project’s cost to more than $50 billion.

The announcement offers a new data point for Wall Street investors watching Meta closely for updates on its AI spending plans. The company’s capital expenditures have ballooned in the last two years, largely due to AI infrastructure costs.

As part of its announcement, Meta touted the project’s local economic impact, saying that the increased tax revenues tied to the data center have recently led to year-end bonuses of up to $50,000 for Richland Parish teachers.

That’s 400% higher than what teachers received last year in the rural Louisiana parish that’s home to about 20,000 people, according to Meta.

Sheldon Jones, the parish’s school district superintendent, said in a statement shared by Meta that the influx of money has been “life-altering for our teachers and their families” and was “transforming our schools.”

“Last year, our teachers received a $10,000 bonus, this year that check was over $50,000,” Jones said, adding, “Meta’s investment has made Richland Parish a destination for education as well as industry.”

Jones did not immediately respond to a request by Business Insider for further comment.

The Hyperion project, according to Meta, is among the largest investments in AI infrastructure worldwide.

Meta said in its Monday post that local Louisiana businesses have received more than $1.6 billion in contracts from the company since it broke ground on the 4 million-square-foot site in December 2024.

“With this expansion, we will be investing over $1 billion in local infrastructure improvements, including roads, water and wastewater systems,” said Meta.

It added that the company “pays the full costs of the energy, water, and related infrastructure the data center uses so consumers aren’t paying the cost.”

The project’s expansion marks a dramatic escalation from last year when Meta and investment firm Blue Owl Capital put the data center’s price tag at about $27 billion with plans for more than 2 gigawatts of compute capacity.

Once operational, Meta says the data center will create more than 1,000 jobs.

While Meta has highlighted the project’s economic benefits, the rapid buildout of AI data centers by Big Tech has become a flashpoint, with critics raising widespread concerns about energy demand, water consumption, and the strain on local infrastructure.