International Business Machines (IBM) experienced its most significant single-day stock decline in over 25 years on Monday. The sharp drop followed an announcement by AI firm Anthropic. Anthropic revealed that its Claude Code tool can now be used to modernize COBOL, a programming language integral to many IBM mainframe systems.
IBM shares fell 13.2%, marking the largest decrease since October 18, 2000. COBOL is a foundational language used across banking, insurance, and government sectors, primarily running on IBM mainframes. Anthropic stated that AI-driven tools can drastically reduce the time and resources needed for COBOL system modernization, potentially shifting projects from years to quarters.
This development comes as the software sector grapples with the expanding capabilities of AI tools. Concerns over AI's impact have recently affected technology stocks, including cybersecurity firms.