Anthropic’s latest Claude Code update triggers massive IBM stock selloff, shares down 13.2% in a day

International Business Machines, or IBM, became the latest victim of Anthropic’s rapidly expanding AI force, as the AI ​​company shared an update on Monday. IBM’s stock price took a hard hit on Monday, falling to its lowest level in nearly three decades.

IBM shares fell 13.2% for its worst day since 2000 at $223.35 per share after Anthropic shared an update on Claude Code, the same artificial intelligence tool that has been causing a rout in IT stocks over the past few weeks.

In a blog post published Monday, Anthropic said its Claude Code tool could help modernize Cobol, an older programming language that runs on IBM computers. The AI ​​startup has revealed that Claude Code can now be used to automate discovery and analysis, which is the foundation of Cobol modernization sophistication. IBM has been selling mainframe systems optimized for processing large-scale transactions for years, for which Cobol is frequently used.

The decline puts IBM shares down 27% in February, heading for the biggest one-month decline since at least 1968, according to data compiled by Bloomberg.

What did Anthropic say about the Claude Code update?

Anthropic shared an update about its AI tool Claude Code in its blog post on Monday.

“Hundreds of billions of COBOL lines are running in production every day, powering critical systems in finance, airlines, and government. Yet the number of people who understand it is decreasing every year,” Anthropic wrote.

“AI is very good at streamlining tasks that once made Cobol modernization cost prohibitive.” he added.

Anthopic said Claude Code can help modernize Cobol codebases.

“Modernizing a Cobol system once required armies of consultants who spent years mapping workflows,” Anthropic wrote in its blog post. “Tools like Claude Code can automate the discovery and analysis phases that take the most effort in Cobol modernization.”

Claude said Code can map dependencies across thousands of lines of code, document workflows and identify risks “that would take human analysts months to surface.”

“Modernization of legacy code stalled for years because understanding legacy code was more expensive than rewriting it. Artificial intelligence is turning that equation on its head,” he said in the blog post.

Why are IBM shares bleeding?

IBM shares took a hit from this news, as most of the mainframes running Cobol are manufactured by IBM; This is the latest victim of Anthropic’s attempt to disrupt legacy code systems and companies’ digital transformation efforts.

The company has come under heavy pressure due to fears that artificial intelligence will stifle the growth of big tech companies.

A significant portion of IBM’s revenue remains tied to its mainframe business. These massive customer-owned servers run some applications on Cobol, a coding language older than those common in the rest of the tech industry. Mainframes are still purchased by customers with high reliability needs, such as the financial or public sector.

Software stocks have been weaker this year due to fears that AI will cause disruption; Much of the sales were driven by AI tools released by companies like Anthropic, OpenAI, and Alphabet.