International Business Machines Corp (NYSE:IBM) isn't the loudest name in AI—but it may be one of the most misunderstood. Even as "Anthropic fears" weigh on sentiment, Wedbush analyst Dan Ives sees roughly 35% upside, with a $340 price target hinging on one key shift: AI moving from hype to production.

Enterprise AI Shift Drives Upside

The core of Ives' thesis is simple.

AI is no longer experimental—it's being deployed.

Enterprises are moving into production-scale use cases, and that's where IBM thrives. Unlike hyperscalers chasing model dominance, IBM is positioned where AI actually gets implemented—across workflows, automation, and mission-critical systems.

Full-Stack AI Flywheel

IBM's edge lies in integration.

Its combination of software, consulting, and infrastructure creates what Ives sees as a durable "flywheel," allowing the company to capture value across the entire AI lifecycle.

Products like WatsonX, alongside Red Hat and security offerings, are starting to show pull-through demand, especially as enterprises look for scalable, compliant solutions.

Government And Security Tailwinds

Momentum is also building in regulated markets.

Recent FedRAMP authorizations and deployments on AWS GovCloud highlight IBM's growing footprint in federal and secure AI environments—areas where trust and compliance matter as much as performance.

At the same time, new offerings like Autonomous Security position IBM to benefit from rising demand for AI-driven cybersecurity.

Earnings Setup And The Debate

Heading into earnings, Ives believes Street estimates are beatable, supported by continued strength in software, hybrid cloud, and automation.

Yet the debate remains.

"Anthropic fears" and broader AI competition continue to cloud the narrative, keeping IBM out of the spotlight.

The Real Bet

This isn't a bet on who builds the best AI model.

It's a bet on who gets paid when AI is actually used.

And if Ives is right, IBM's next move may depend less on hype—and more on execution.

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