Explained: Why TCS, Infosys, Wipro & other IT stocks may tumble after IBM's historic 25% plunge

IBM's sharp 25% plunge after a weak Q2 preview, where revenue came in at $17.2 billion against estimates of $17.9 billion and adjusted EPS at $2.93 versus $3.02 expected, has triggered a sector-wide selloff in IT stocks. The company lost nearly $70 billion in market value, with Infosys ADRs down 4% and Wipro ADRs down 3%, as investors fear a broader shift in enterprise technology spending from software and IT services toward AI hardware like chips, servers, and memory. Indian IT companies, already facing headwinds from weak discretionary spending and AI-driven automation concerns, now face heightened worries about muted upcoming June quarter results and pressure on FY27 growth guidance.