IBM stock expands defense biz with SHIELD contract worth up to $151B
IBM (IBM) stock announced on Thursday that it has been selected to support the US Missile Defense Agency's Scalable Homeland Innovative Enterprise Layered Defense (SHIELD) program with a contract that could be worth up to $151 billion.
As part of the indefinite delivery/indefinite quantity (IDIQ) contract, IBM will be working on a "broad range of work areas" that it said will be focused on allowing for the rapid delivery of "innovative capabilities" to the warfighter which gives it increased speed and agility.
The company notes that it has been supporting the US government for more than century, delivering technology that's meant to enhance mission outcomes and improve security.
IBM has most recently been focused on helping government agencies deploy artificial intelligence in order to bolster productivity, efficiency and improve decision-making across missions.
For defense agencies, IBM said it is "drawing on deep experience and sustained investment in advanced technology and research – including AI-enabled sensing – to deliver solutions with built-in governance, interoperability, and mission-grade security."
The company said that it will be providing the Mission Defense Agency with tools that can accelerate the deployment of "modern capabilities, protect sensitive data, and strengthen national defense."
The SHIELD program is part of President Trump's Golden Dome missile defense initiative, which is focused on building resilient and layered protection against air, missile, space, cyber, and hybrid threats from all operational domains.
"IBM is proud to partner with the Missile Defense Agency to accelerate the delivery of advanced, mission-critical capabilities," Susan Wedge, managing partner at the US federal market for IBM, said in a statement. "By bringing the full depth of our expertise and cutting-edge technologies, we will help ensure the warfighter is equipped to respond with greater speed, agility, and confidence in an increasingly complex threat environment."
IBM has also been working with the defense departments of American allies, which includes a £320 million (USD 433.7 million) contract in October with the UK's Armed Forces that calls for it to deliver a new AI-powered platform that's meant to support how the country's military maintains and manages its equipment.
Called the Defence Equipment Engineering Asset Management Systems (DEEAMS), it will replace 17 fragmented, siloed applications that the UK government calls outdated with one enabled modern streamlined platform.
The government estimates that IBM's DEEAMS platform will deliver £1 billion (USD $1.4 billion) in savings, including cutting down costs on support and IT.
Meanwhile, the Trump administration has been looking to bolster its SHIELD program to start the new year, having awarded a contract to AST SpaceMobile last month that the company said "encompasses a broad range of work areas that allows for the rapid delivery of innovative capabilities to the warfighter with increased speed and agility."
Terms of the contract were not disclosed.
IBM's shares stayed mostly flat on Thursday, as the government contract was not enough to move the needle during a broad selloff of tech stocks.
Nonetheless, the 13 analysts covering IBM's shares have recently raised their price targets, with AI and quantum computing seen by Wall Street as long-term tailwinds for the company.