IBM (IBM) 10-K risk factor changes: FY2020 vs FY2019

_Downturn in Economic Environment and Client Spending Budgets Could Impact the Company’s Business:_ If overall demand for IBM’s products and solutions decreases, whether due to general economic [removed: conditions] [added: conditions, including those associated with the COVID-19 pandemic,] or a shift in client buying patterns, the company’s revenue and profit could be impacted.

_The Company May Not Meet Its Growth and Productivity Objectives under Its Internal Business Transformation and Global Integration Initiatives:_ On an ongoing basis, IBM seeks to drive greater agility, productivity, flexibility and cost savings by continuously transforming with the use of automation, artificial intelligence, agile processes and changes to the [removed: way the company works,] [added: ways of working,] while also enabling the scaling of resources, offerings and investments through the company’s globally integrated model across both emerging and more established markets.

_Failure of Innovation Initiatives Could Impact the Long-Term Success of the Company:_ IBM has been moving into areas, including those that incorporate or utilize [added: hybrid cloud,] artificial intelligence, blockchain, IoT, quantum and other disruptive technologies, in which it can differentiate itself through [added: responsible] innovation, by leveraging its investments in R&D and attracting a successful developer ecosystem.

If IBM is unable to continue its cutting-edge innovation in a highly competitive and rapidly evolving environment or is unable to commercialize such innovations, expand and scale them with sufficient speed and [removed: versatility,] [added: versatility or is unable to attract a successful developer ecosystem,] the company could fail in its ongoing efforts to maintain and increase its market share and its profit margins.

_Damage to IBM’s Reputation Could Impact the Company’s Business:_ IBM has one of the strongest brand names in the world, and its brand and overall reputation could be negatively impacted by many factors, including if the company does not continue to be recognized for its [removed: industry-leading] [added: industry leading] technology and solutions and as a [removed: cognitive] [added: hybrid cloud and AI] leader.

If the company’s brand image is tarnished by negative perceptions, its ability to attract and retain [removed: customers and] [added: customers,] talent [added: and ecosystem partners] could be impacted.

Certain of the [removed: Company’s] [added: company’s] offerings incorporate [added: or utilize] open source [added: and other third-party] software licensed [removed: without] [added: with limited or no] warranties, indemnification, or other contractual [removed: protections.][added: protections for IBM.]

_Cybersecurity and Privacy Considerations Could Impact the Company’s Business:_ There are numerous and evolving risks to cybersecurity and privacy, including risks originating from intentional acts of criminal hackers, hacktivists, nation states and competitors; from intentional and unintentional acts of customers, contractors, business partners, vendors, employees and other third parties; and from errors in processes or [removed: technologies.][added: technologies, as well as the risks associated with an increase in the number of customers, contractors, business partners, vendors, employees and other third parties working remotely as a result of the COVID-19 pandemic.]

Computer hackers and others routinely [removed: attempt to] attack the security of technology products, services, systems and [removed: networks.][added: networks using a wide variety of methods, including ransomware]

[removed: Such attacks may involve] [added: Attacks also include social engineering to] fraudulently [removed: inducing] [added: induce] customers, contractors, business partners, vendors, employees and other third parties to disclose information, transfer funds, or unwittingly provide access to systems or data.

Cyber threats are continually evolving, making it difficult to [removed: detect and] defend against [removed: certain] [added: such] threats and vulnerabilities that can persist [added: undetected] over extended periods of time.

The company’s products, services, systems and networks, including cloud-based systems and systems and technologies that the company maintains on behalf of its customers, [removed: may be] [added: are] used in critical company, customer or third-party operations, and [removed: may] involve the storage, processing and transmission of sensitive data, including valuable intellectual property, other proprietary or confidential data, regulated data, and personal information of employees, customers and others.

Successful cybersecurity attacks or other security incidents could result in, for example, one or more of the following: unauthorized access to, disclosure, modification, misuse, loss, or destruction of company, customer, or other third party data or systems; theft or import or export of sensitive, regulated, or confidential data including personal information and intellectual [removed: property;] [added: property, including key innovations in artificial intelligence, blockchain, IoT, quantum, or other disruptive technologies;] the loss of access to critical data or systems through ransomware, crypto mining, destructive attacks or other means; and business delays, service or system disruptions or denials of service.

In the event of such actions, the company, its customers and other third parties could be exposed to liability, litigation, and regulatory or other government action, as well as the loss of existing or potential customers, damage to brand and reputation, [added: damage to our competitive position,] and other financial loss.

In addition, the fast-paced, evolving, pervasive, and sophisticated nature of certain cyber threats and vulnerabilities, as well as the scale and complexity of the business and infrastructure, make it possible that certain threats or vulnerabilities will be undetected or unmitigated in time to prevent [added: or minimize the impact of] an attack on the company or its [removed: customers, and may not be detected or remediated for some time afterward particularly if additional steps are required to implement remediation-related updates.][added: customers.]

To date, while the company continues to monitor for, identify, investigate, respond to and remediate [removed: security incidents, including those associated with] cybersecurity [removed: attacks,] [added: incidents,] there [removed: has] [added: have] not been [removed: a] cybersecurity [removed: attack] [added: incidents] that [removed: has] [added: have] had a material adverse effect on the company, though there is no assurance that there will not be [removed: a] cybersecurity [removed: attack] [added: incidents] that [removed: has] [added: will have] a material adverse effect in the future.

As a global enterprise, the regulatory environment with regard to cybersecurity, privacy and data protection issues is increasingly complex and will continue to impact the company’s business, including through increased risk, increased costs, and expanded or otherwise altered compliance [removed: obligations.][added: obligations, including with respect to the increased regulatory activity around the security of critical infrastructure, IoT devices, and various customer and government supply chain security programs.]

The enactment and expansion of data protection and privacy laws and regulations around the globe, [added: including an increased focus on international data transfer mechanisms driven by] the [added: European Court of Justice decision in the Schrems II matter; the] lack of harmonization of such laws and [removed: regulations,] [added: regulations; the increase in associated litigation] and [added: enforcement activity;] the potential [added: for damages, fines and penalties; and the potential] regulation of new and emerging technologies such as artificial intelligence will continue to result in increased compliance costs and risks.

Any additional costs and penalties associated with increased [removed: compliance] [added: compliance, enforcement,] and risk reduction could make certain offerings less profitable or increase the difficulty of bringing certain offerings to market.

_Due to the Company’s Global Presence, Its Business and Operations Could Be Impacted by Local Legal, Economic, Political, Health and Other [removed: Conditions:_] [added: Conditions, including the COVID-19 Pandemic:_] The company is a globally integrated entity, operating in over 175 countries worldwide and deriving more than [removed: sixty] [added: fifty] percent of its revenues from sales outside the United States.

[removed: The company’s] results of operations also could be affected by economic and political changes in those countries and by macroeconomic changes, including recessions, inflation, currency fluctuations between the U.S. dollar and non-U.S. currencies and adverse changes in trade relationships amongst those countries.

[removed: For] [added: Another] example, the [removed: U.K. referendum to exit] [added: U.K.’s withdrawal] from the E.U., commonly referred to as [removed: “Brexit”,] [added: “Brexit,”] has caused global economic, trade and regulatory uncertainty.

The company is actively monitoring and planning for [added: possible impacts from] Brexit.

In addition, IBM is subject to the continuous examination of its income tax returns by the United States [added: Internal Revenue Service and other tax authorities around the world.]

IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders includes information about potential impacts from pension funding and the use of certain assumptions regarding pension matters.

_The Company’s Use of Accounting Estimates Involves Judgment and Could Impact the Company’s Financial Results:_ The application of accounting principles generally accepted in the U.S. (GAAP) requires the company to make estimates and assumptions about certain items and future events that directly affect its reported financial [removed: condition.][added: condition, including considering financial implications of the macroeconomic impacts of the COVID-19 pandemic.]

The company’s most critical accounting estimates are described in the Management Discussion in IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, under “Critical Accounting Estimates.” In addition, as discussed in note R, “Commitments & Contingencies,” in IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, the company makes certain estimates including decisions related to legal proceedings and reserves.

_The Company’s Business Could Be Impacted by Its Relationships with Critical Suppliers:_ IBM’s business employs a wide variety of [removed: components,] [added: components (hardware and software),] supplies, services and raw materials from a substantial number of suppliers around the world.

Further, the failure of the company’s suppliers to deliver components, supplies, services and raw materials in sufficient quantities, in a timely [added: manner, and in compliance with all applicable laws and regulations could adversely affect the company’s business.]

_Product [added: and Service] Quality Issues Could Impact the Company’s Business and Operating Results:_ The company has rigorous quality control standards and processes intended to prevent, detect and correct errors, malfunctions and other defects in its products and services.

_The Company Is Exposed to Currency and Financing Risks That Could Impact Its Revenue and Business:_ The company derives a significant percentage of its revenues and costs from its affiliates operating in local currency environments, and those results are affected by changes in the relative values of non-U.S. currencies and the U.S. [removed: dollar.][added: dollar, as well as sudden shifts in regional or global economic activity such as those associated with the COVID-19 pandemic.]

[removed: Further, inherent in the company’s financing business are risks related to the concentration of credit, client] creditworthiness, interest rate and currency fluctuations on the associated debt and liabilities, the determination of residual values and the financing of assets other than traditional IT assets.

_The Company’s Financial Performance Could Be Impacted by Changes in Market Liquidity Conditions and by Customer Credit Risk on Receivables:_ The company’s financial performance is exposed to a wide variety of industry sector dynamics [removed: worldwide.][added: worldwide, including sudden shifts in regional or global economic activity such as those associated with the COVID-19 pandemic.]

IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders includes information about the company’s liquidity position.

The company’s client base includes many [removed: worldwide enterprises,] [added: enterprises worldwide,] from small and medium businesses to the world’s largest organizations and governments, with a significant portion of the company’s revenue coming from global clients across many sectors.

[added: Such transactions present significant challenges and risks and] there can be no assurances that the company will manage such transactions successfully or that strategic opportunities will be available to the company on acceptable terms or at all.

The related risks include the company failing to achieve strategic objectives, [added: including the company’s intention to separate the Managed Infrastructure Services unit of its Global Technology Services segment into a new and independent public company,] anticipated revenue improvements and cost savings, the failure to retain key strategic relationships of acquired companies, the failure to retain key personnel and the assumption of liabilities related to litigation or other legal proceedings involving the businesses in such transactions, as well as the failure to close planned transactions.

The risks associated with such legal proceedings are described in more detail in note R, “Commitments & [removed: Contingencies”] [added: Contingencies,”] in IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders.

Risks Related to Our Business

Further, if open source code that IBM utilizes is no longer maintained, developed or enhanced by the relevant community of independent open source software programmers, most of whom we do not employ, we may be unable to develop new technologies, adequately enhance our existing technologies or meet customer requirements for innovation, quality and price.

_The Announced Spin-Off of the Company’s Managed Infrastructure Services Unit into a Standalone, Publicly-Traded Company is Contingent upon the Satisfaction of a Number of Conditions, May Not Be Completed on the Currently Contemplated Timeline, or at All, and May Not Achieve the Intended Benefits:_ On October 8, 2020, the company announced its intention to separate the Managed Infrastructure Services unit of its Global Technology Services segment into a new, independent public company (currently referred to as NewCo).

Completion of the announced spin-off, as well as the timing of completion, is subject to the readiness of NewCo to operate as an independent public company, finalization of the financial statements of NewCo, assurance that the separation will be tax-free for U.S. federal income tax purposes, finalization of the capital structure of the company and NewCo, the effectiveness of appropriate filings with the U.S. Securities and Exchange Commission, final approval of the IBM Board of Directors, and other customary items.

The announced spin-off is complex in nature and may be affected by unanticipated developments or changes in market conditions.

There is the potential for business disruption and, as previously disclosed, the company expects significant separation costs.

These or other unanticipated developments or costs could delay or prevent the announced spin-off or cause the announced spin-off to occur on terms or conditions that are less favorable than anticipated.

Furthermore, if the spin-off is completed, there is no guarantee that it will be successful in meeting its objectives or achieving its intended benefits.

Any of these factors could have a material adverse effect on our business and results of operations.

Further, general economic conditions, including sudden shifts in regional or global economic activity such as those associated with the COVID-19 pandemic may impact the company’s financial results in any particular period.

Further, the company may be impacted directly or indirectly by the development and enforcement of laws and regulations in the U.S. and globally that are specifically targeted at the technology industry.

The company’s

For example, on March 11, 2020, the World Health Organization (WHO) declared the novel coronavirus (COVID-19) a global pandemic.

The COVID-19 pandemic has created significant volatility, uncertainty and economic disruption.

In the current macroeconomic environment, clients continue to balance short-term challenges and opportunities for transformation.

Their short-term priorities continue to be focused on operational stability, flexibility and cash preservation, and as such, we may experience some disruptions in transactional performance.

Additionally, clients’ short-term priorities, as well as quarantines, limitations on travel and other factors associated with the COVID-19 pandemic may result in delays in some services projects.

Risks Related to Cybersecurity and Data Privacy

or other malicious software and attempts to exploit vulnerabilities in hardware, software, and infrastructure.

​

Risks Related to Laws and Regulations

Risks Related to Financing and Capital Markets Activities

Further, inherent in the company’s financing business are risks related to the concentration of credit, client

Risks Related to Ownership of IBM Securities

If the code is no longer maintained by the relevant open source community, then it may be more difficult to make the necessary revisions to the software, including modifications to address security

vulnerabilities, which could impact IBM’s ability to market its products, mitigate cybersecurity risks or fulfill its contractual obligations to customers.

Internal Revenue Service and other tax authorities around the world.

manner, and in compliance with all applicable laws and regulations could adversely affect the company’s business.

Such transactions present significant challenges and risks and

Refer to pages [removed: 26] [added: 18] through 64 of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which are incorporated herein by reference.

Refer to the section titled “Market Risk” on pages 63 and 64 of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which is incorporated herein by reference.

This was signaled [removed: over 90] [added: almost 100] years ago, in 1924, when C-T-R changed its name to International Business Machines Corporation.

IBM [removed: Strategy][added: Strategy—pages 23 to 25.]

Business Segments and [removed: Capabilities][added: Capabilities—pages 25 to 28.]

IBM Worldwide [removed: Organizations][added: Organizations—page 28.]

Our principal methods of competition are: technology innovation; performance; price; quality; brand; our broad range of capabilities, products and services; [added: talent;] client [removed: relationships;] [added: relationships and trust;] the ability to deliver business value to clients; and service and support.

In order to maintain leadership, [removed: a corporation] [added: we] must continue to invest, innovate and integrate.

[removed: Over the last several years, we] [added: We are redefining our future as a hybrid cloud and AI company and] have been making [removed: investments] [added: investments, both organic] and [added: inorganic, as well as] shifting resources, embedding AI and cloud into our offerings while building new solutions and modernizing our existing platforms.

The principal competitors in this segment include Alphabet Inc. (Google), Amazon.com, Inc. (Amazon), BMC, [added: Broadcom,] Cisco Systems, Inc. (Cisco), [added: FireEye,] Microsoft Corporation (Microsoft), Oracle Corporation (Oracle), Salesforce, [removed: SAP] [added: SAP, Splunk] and VMware.

We compete with [removed: broad based] [added: broad-based] competitors including: Accenture, Capgemini, DXC Technology (DXC), Fujitsu; cloud services [removed: providers, such as Google and Microsoft;] [added: providers;] India-based service providers; the consulting practices of public accounting firms; and many companies that primarily focus on local markets or niche service areas.

GTS competes in [removed: project services,] [added: project,] managed and outsourcing services, cloud-delivered services, and technical and IT support services.

[removed: Our] [added: In Infrastructure & Cloud Services, our] competitors include: Atos, DXC, Fujitsu, HCL, [removed: Tata] [added: Infosys,Tata] Consulting Services, Wipro and many companies that primarily focus on local markets or niche service areas.

Global Financing’s [removed: access to capital and its] ability to manage credit and residual value risk generates a competitive advantage for the company.

In client and commercial financing, Global Financing [added: primarily] competes with [removed: three types of companies in providing financial services to IT customers: other captive financing entities of IT companies such as Cisco and HPE,] non-captive financing entities and financial institutions.

In remanufacturing and remarketing, [removed: the company competes] [added: we compete] with local and regional brokers plus original manufacturers in the fragmented worldwide used IT equipment market.

“Risk Factors” on pages [removed: 10] [added: 4] to [removed: 15] [added: 10] are cautionary statements that accompany those forward-looking statements.

The following information is included in IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders and is incorporated herein by reference:

Segment information and revenue by classes of similar products or services—pages [removed: 89] [added: 91] to [removed: 93.][added: 96.]

Financial information regarding environmental [removed: activities—pages 113 and 114.][added: activities—page 117.]

The number of persons employed by the registrant—page [removed: 64.][added: 29.]

The management discussion overview—pages [removed: 27] [added: 19] to [removed: 29.][added: 22.]

Executive Officers of the Registrant (at February [removed: 25, 2020):][added: 23, 2021):]

| [removed: Virginia M. Rometty,] [added: Arvind Krishna,] Chairman of the [removed: Board, President] [added: Board] and Chief Executive Officer* | ​ | [removed: 62] [added: 58] | ​ | [removed: 2005] [added: 2020] |

| Michelle H. Browdy, Senior Vice President, Legal and Regulatory Affairs, and General Counsel | ​ | [removed: 55] [added: 56] | ​ | 2015 |

| Robert F. Del Bene, Vice President and Controller | ​ | [removed: 60] [added: 61] | ​ | 2017 |

| [removed: Diane] [added: Nickle] J. [removed: Gherson,] [added: LaMoreaux,] Senior Vice President and Chief Human Resources Officer | ​ | [removed: 62] [added: 41] | ​ | [removed: 2013] [added: 2020] |

| James J. Kavanaugh, Senior Vice President and Chief Financial Officer, Finance and Operations | ​ | [removed: 53] [added: 54] | ​ | 2008 |

[removed: Each executive officer named above] [added: Whitehurst,] has been an executive of IBM or its subsidiaries during the past five years.

Our hybrid cloud platform and AI technology and services capabilities support clients’ digital transformations and help them engage with their customers and employees in new ways.

The following information is included in IBM’s 2020 Annual Report to Stockholders and is incorporated by reference:

Human Capital—page 29.

As we execute our strategy as a hybrid cloud and AI company, deploy new delivery and go-to-market models and expand our ecosystem, we are regularly exposed to new competitors.

We have built a hybrid cloud platform based on open technologies that allows clients to realize their digital and AI transformations across the applications, data and

environments in which they operate.

The market contains a diverse set of competitors, with GTS the share leader.

In Technology Support Services, we compete with several hardware and software vendors who offer support services for their own products, as well as independent support services providers.

| Gary D. Cohn, Vice Chairman | ​ | 60 | ​ | 2021 |

| James M. Whitehurst, President | ​ | 53 | ​ | 2020 |

Each executive officer named above, with the exception of Gary D.

Cohn and James M.

Mr. Cohn is Co-Chairman of Cohn Robbins Holding Corp, a special-purpose acquisition company.

Mr. Cohn previously served as Assistant to the President for Economic Policy and Director of the National Economic Council from January 2017 until April 2018.

Before serving in the White House, Mr. Cohn was President and Chief Operating Officer of The Goldman Sachs Group, Inc. from 2006-2016.

Mr. Whitehurst served as Chief Executive Officer of Red Hat, Inc., a multinational software company, from 2007 until it was acquired by IBM in 2019.

IBM solutions typically create value by enabling new capabilities for clients that transform their businesses and help them engage with their customers and employees in new ways.

IBM’s strategy begins with our clients.

IBM is distinguished as being first and foremost an Enterprise company, serving the world’s leaders in their industries.

Serving enterprises requires a distinct set of skills as our clients entrust us with building, integrating and running the world’s mission-critical systems.

These are systems that cannot fail, systems that require the highest levels of privacy and security.

They are built with our software and on our systems, designed and managed by IBM services.

For example, we manage approximately ninety percent of the credit card transactions and half of the world’s wireless connections.

We do this with an unparalleled commitment to our clients’ data security.

We are unique in bringing innovative technology and industry expertise on a foundation of trust and security as an _integrated proposition_ to our clients.

This integrated proposition allows us to deliver business impact that matters to our clients, impact that _requires_ bringing together technologies such as hybrid cloud, data and AI insight with workflow and advanced industry skills.

This integrated proposition helps our clients transform themselves from traditional businesses to what we call Cognitive Enterprises.

Furthermore, as technology becomes more central for business, as well as in our personal lives, trust matters more than ever.

For decades we have followed core principles grounded in commitments to trust and transparency that guide our responsible development and deployment of new technologies.

These values ground our business decisions, inspire our employees, and sustain our client relationships.

We have not only followed guidelines around the responsible handling of data and the stewardship of new technology, but created them, published them and invited others to adopt similar commitments.

Our focus is not just on our direct client work, but extends to society at large, as we have been very active in areas such as education, sustainability and security.

This is reinforced through a culture of inclusion and diversity.

All of IBM treats this “responsible stewardship” as core to our mission.

A New Chapter in Technology

2019 ushered in Chapter 2 of our clients’ digital journeys in which the two predominant technology forces of our day—hybrid cloud and data/AI—are moving from “start-up” to “production at scale”.

These two forces work _together_ to help companies become what we call Cognitive Enterprises—companies that are powered by innovation, agility and data-driven intelligent decision making.

We describe below how IBM is leading the way in Chapter 2.

Hybrid Cloud

Chapter 1 marked the early stages of cloud with the rise of public cloud.

This stage was focused on new end-user applications, including applications that have allowed consumers to check their bank balances, access social media, make online purchases and receive online support.

While movement to public cloud has been strong, only twenty percent of workloads have been addressed in Chapter 1.

Clients are merely at the beginning of a multi-stage journey.

Chapter 2 is about clients modernizing the remaining eighty percent of workloads, moving mission-critical workloads to the cloud and infusing AI deep into the decision-making of their businesses.

These mission-critical workloads include core financial transaction systems, customer databases and Enterprise Resource Planning systems.

Some of these workloads will gravitate to the public cloud in Chapter 2, while others will move to a private cloud or remain in traditional IT environments for security, compliance and/or performance reasons.

Wherever clients’ workloads reside, these environments must work together seamlessly to communicate, share data and share capacity.

With enterprises having accumulated as many as fifteen public clouds, each with its own means of management, harmonizing these different clouds has become a necessity.

Bringing these multiple public clouds, private cloud and traditional IT together is what we call hybrid cloud.

Hybrid cloud defines the mission for Chapter 2 in IT.

We are a leader in hybrid cloud, and our mission in Chapter 2 is to bring our expertise and experience in building and managing mission-critical systems to lead our enterprise clients along this multi-stage journey.

Our public cloud is built on a foundation of open source software and enterprise grade infrastructure.

It is the most open and secure public cloud, and it is built for the enterprise with Cloud Paks—enterprise-ready, containerized software solutions for applications, automation, data, integration and multi-cloud management.

To accelerate our clients’ success, we acquired Red Hat in 2019, further strengthening our leadership in hybrid cloud.

Red Hat is the world’s leader in open source technology, including Enterprise Linux, the operating system of the cloud, as well as containers and OpenShift, technology platforms that create seamless integration between traditional and cloud environments.

As the leader in open source, Red Hat brings capability that enables applications to be “written once and run anywhere”, in turn helping companies avoid lock-in to a single cloud provider, thereby taking advantage of the entire industry’s innovation.

Refer to note R, “Commitments & Contingencies,” on pages [removed: 114] [added: 118] to [removed: 116] [added: 120] of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which is incorporated herein by reference.

FOR THE YEAR ENDED DECEMBER 31, [removed: 2019][added: 2020]

| [removed: 2.750%] [added: 1.250%] Notes due [removed: 2020] [added: 2023] | ​ | IBM [removed: 20B] [added: 23A] | ​ | New York Stock Exchange |

The aggregate market value of the voting stock held by non-affiliates of the registrant as of the last business day of the registrant’s most recently completed second fiscal quarter was [removed: $122.1] [added: $107.5] billion.

The registrant had [removed: 888,408,023] [added: 893,594,090] shares of common stock outstanding at February 10, [removed: 2020.][added: 2021.]

Portions of IBM’s Annual Report to Stockholders for the year ended December 31, [removed: 2019] [added: 2020] are incorporated by reference into Parts I, II and IV of this Form 10-K.

Portions of IBM’s definitive Proxy Statement to be filed with the Securities and Exchange Commission and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020] [added: 27, 2021] are incorporated by reference into Part III of this Form 10-K.

| ​ | [Item 1A. Risk Factors](#Item1ARiskFactors_717549) | [removed: 10] [added: 4] |

| ​ | [Item 1B. Unresolved Staff Comments](#Item1BUnresolvedStaffComments_93548) | [removed: 15] [added: 10] |

| ​ | [Item 2. Properties](#Item2Properties_839240) | [removed: 15] [added: 10] |

| ​ | [Item 3. Legal Proceedings](#Item3LegalProceedings_169881) | [removed: 16] [added: 11] |

| ​ | [Item 4. Mine Safety Disclosures](#Item4MineSafetyDisclosures_606028) | [removed: 16] [added: 11] |

| [PART II](#PARTII_877712) | | [removed: 17] [added: 12] |

| ​ | [Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#Item5MarketfortheRegistrantsCommonEquity) | [removed: 17] [added: 12] |

| ​ | [Item 6. Selected Financial Data](#Item6SelectedFinancialData_263221) | [removed: 17] [added: 12] |

| ​ | [Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations](#Item7ManagementsDiscussionandAnalysis_83) | [removed: 17] [added: 12] |

| ​ | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](#Item7AQuantitativeandQualitativeDisclosu) | [removed: 18] [added: 12] |

| ​ | [Item 8. Financial Statements and Supplementary Data](#Item8FinancialStatementsandSupplementary) | [removed: 18] [added: 13] |

| ​ | [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#Item9ChangesinandDisagreementswithAccoun) | [removed: 18] [added: 13] |

| ​ | [Item 9A. Controls and Procedures](#Item9AControlsandProcedures_656098) | [removed: 18] [added: 13] |

| ​ | [Item 9B. Other Information](#Item9BOtherInformation_805611) | [removed: 18] [added: 13] |

| [PART III](#PARTIII_485963) | | [removed: 19] [added: 14] |

| ​ | [Item 10. Directors, Executive Officers and Corporate Governance](#Item10DirectorsExecutiveOfficersandCorpo) | [removed: 19] [added: 14] |

| ​ | [Item 11. Executive Compensation](#Item11ExecutiveCompensation_299944) | [removed: 19] [added: 14] |

| ​ | [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#Item12SecurityOwnershipofCertainBenefici) | [removed: 19] [added: 14] |

| ​ | [Item 13. Certain Relationships and Related Transactions, and Director Independence](#Item13CertainRelationshipsandRelatedTran) | [removed: 21] [added: 16] |

| ​ | [Item 14. Principal Accounting Fees and Services](#Item14PrincipalAccountingFeesandServices) | [removed: 21] [added: 17] |

| [PART IV](#PARTIV_494636) | | [removed: 22] [added: 18] |

| ​ | [Item 15. Exhibits](#Item15ExhibitsFinancialStatementSchedule) | [removed: 22] [added: 18] |

| ​ | [Item 16. Form 10-K Summary](#Item16Form10KSummary_73772) | [removed: 29] [added: 25] |

| ​ | ​ | ​ | ​ | NYSE Chicago |

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

| ​ | ​ | ​ | ​ | Chicago Stock Exchange |

| 1.875% Notes due 2020 | ​ | IBM 20A | ​ | New York Stock Exchange |

| 1.25% Notes due 2023 | ​ | IBM 23A | ​ | New York Stock Exchange |

As of December 31, [removed: 2019,] [added: 2020,] in aggregate, we owned or leased facilities for current use consisting of approximately [removed: 75 million square feet worldwide, including 2] [added: 73] million square feet [removed: of leased space resulting from the acquisition of Red Hat on July 9, 2019.][added: worldwide.]

At December 31, [removed: 2019,] [added: 2020,] IBM’s facilities in the U.S. had aggregate floor space of approximately [removed: 26] [added: 25] million square feet, of which [removed: nearly 13] [added: approximately 12] million was owned and [removed: over] 13 million was leased.

[removed: Outside the U.S., facilities totaled approximately 49] [added: 48] million square feet, of which 10 million was owned and [removed: 39] [added: 38] million was leased.

Outside the U.S., facilities totaled nearly

Refer to page 142 of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which is incorporated herein by reference solely as it relates to this item.

IBM common stock is listed on the New York Stock Exchange and the [added: NYSE] Chicago [removed: Stock Exchange] under the symbol “IBM.” There were [removed: 380,707] [added: 373,649] common stockholders of record at February 10, [removed: 2020.][added: 2021.]

The following table provides information relating to the company’s repurchase of common stock for the fourth quarter of [removed: 2019.][added: 2020.]

| October 1, [removed: 2019—] [added: 2020—] October 31, [removed: 2019] [added: 2020] | ​ | — | ​ | $ | — | ​ | — | ​ | $ | 2,007,611,768 |

| November 1, [removed: 2019—] [added: 2020—] November 30, [removed: 2019] [added: 2020] | ​ | — | ​ | $ | — | ​ | — | ​ | $ | 2,007,611,768 |

| December 1, [removed: 2019—] [added: 2020—] December 31, [removed: 2019] [added: 2020] | ​ | — | ​ | $ | — | ​ | — | ​ | $ | 2,007,611,768 |

The company suspended its share repurchase program at the time of [removed: closing.][added: the Red Hat closing in mid-2019.]

At December 31, [removed: 2019] [added: 2020] there was approximately $2.0 billion in authorized funds remaining for purchases under this program.

The company’s acquisition of Red Hat on July 9, 2019, was funded through a combination of debt and cash, with incremental debt issued earlier in 2019.

We have early adopted the recent amendment to Regulation S-K Item 301, which eliminates Selected Financial Data.

Refer to pages 139 and 140 of IBM’s 2019 Annual Report to Stockholders, which are incorporated herein by reference.

Refer to pages 68 through [removed: 138] [added: 140] of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which are incorporated herein by reference.

We have early adopted the recent amendment to Regulation S-K Item 302, which replaces the current requirement for quarterly tabular disclosure with a principles-based requirement for material retrospective changes.

Refer to “Report of Management” and “Report of Independent Registered Public Accounting Firm” on pages 65 to 67 of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which are incorporated herein by reference.

As a result, Article III, Section 2 of the [removed: Company’s] [added: company's] By-Laws was amended to [removed: increase] [added: decrease] the number of directors to [removed: 14,] [added: twelve,] effective April [removed: 6, 2020.][added: 27, 2021.]

The full text of [removed: IBM’s] [added: IBM's] By-Laws, as amended effective April [removed: 6, 2020,] [added: 27, 2021,] is included as Exhibit 3.2 [removed: of] [added: to] this report.

Due to retirement, Sidney Taurel will not stand for re-election at the company's annual meeting of stockholders on April 27, 2021.

As previously announced, Arvind Krishna has been elected Chief Executive Officer and a member of the IBM Board of Directors, effective April 6, 2020.

Additionally, Article V, Section 8 of the Company’s By-Laws was amended to state that either the Chairman of the Board or an officer, as the Board of Directors may designate, shall be the Chief Executive Officer of the Company.

Refer to the information under the captions “Election of Directors for a Term of One Year,” [removed: “Board] [added: “Governance] and [removed: Governance—Committees] [added: Board—Committees] of the Board,” [removed: “Board] [added: “Governance] and [removed: Governance—Section] [added: Board—Section] 16(a) Beneficial Ownership Reporting Compliance,” [removed: “Board] [added: “Governance] and [removed: Governance—Corporate] [added: Board—Corporate] Governance” and “Frequently Asked Questions—How do I submit an item of business for the [removed: 2021] [added: 2022] annual meeting?” in IBM’s definitive Proxy Statement to be filed with the SEC and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] all of which information is incorporated herein by reference.

Also refer to Item 1 of this Form 10-K under the caption “Executive Officers of the Registrant (at February [removed: 25, 2020)”] [added: 23, 2021)”] on page [removed: 9] [added: 3] for additional information on the company’s executive officers.

Refer to the information under the captions [removed: “2019] [added: “2020] Summary Compensation Table [added: and Related] Narrative,” [removed: “2019] [added: “2020] Summary Compensation Table,” [removed: “2019] [added: “2020] Compensation Discussion and Analysis,” [removed: “2019] [added: “2020] Grants of Plan-Based Awards Table,” [removed: “2019] [added: “2020] Outstanding Equity Awards at Fiscal Year-End Table,” [removed: “2019] [added: “2020] Option Exercises and Stock Vested Table,” [removed: “2019 Pension Plan Narrative,” “2019] [added: “2020] Retention Plan Table,” [removed: “2019] [added: “2020] Pension Benefits Narrative,” [removed: “2019] [added: “2020] Pension Benefits Table,” [removed: “2019] [added: “2020] Nonqualified Deferred Compensation Narrative,” [removed: “2019] [added: “2020] Nonqualified Deferred Compensation Table,” [removed: “2019] [added: “2020] Potential Payments Upon Termination Narrative,” [removed: “2019] [added: “2020] Potential Payments Upon Termination Table,” [removed: “Board] [added: “Governance] and [removed: Governance—Compensation] [added: Board—Compensation] Committee Interlocks and Insider Participation: None,” “Compensation Program as It Relates to Risk,” [removed: “Executive Compensation—2019 Report] [added: “2020 Executive Compensation—Report] of the Executive Compensation and Management Resources Committee of the Board of Directors,” and “Pay Ratio” in IBM’s definitive Proxy Statement to be filed with the SEC and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] all of which information is incorporated herein by reference.

Refer to the information under the captions “Ownership of Securities—Security Ownership of Certain Beneficial Owners” and “Ownership of Securities—Common Stock and Stock-Based Holdings of Directors and Executive Officers” in IBM’s definitive Proxy Statement to be filed with the SEC and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] all of which information is incorporated herein by reference.

| (1) | In connection with [removed: 27] [added: 19] acquisition transactions, [removed: 118,567] [added: 83,839] additional share based awards, consisting of stock options, were outstanding at December 31, [removed: 2019] [added: 2020] as a result of the Company’s assumption of awards granted by the acquired entities. The weighted-average exercise price of these awards was [removed: $42.75.] [added: $43.88.] The Company has not made, and will not make, any further grants or awards of equity securities under the plans of these acquired companies. |

| (2) | The numbers included for PSUs in column (a) above reflect the maximum number payout. Assuming target number payout, the number of securities to be issued upon exercise of PSUs for equity compensation plans approved by security holders is [removed: 2,746,648] [added: 3,426,312] and for equity compensation plans not approved by security holders is [removed: 109,802.] [added: 125,188.] For additional information about PSUs, including payout calculations, refer to the information under [removed: ‘‘2019] [added: ‘‘2020] Summary Compensation Table [removed: Narrative,’’] [added: Narrative’’] in IBM’s definitive Proxy Statement to be filed with the Securities and Exchange Commission and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020.] [added: 27, 2021.] |

For additional information about the DCEAP, see [removed: ‘‘2019] [added: ‘‘2020] Director Compensation Narrative’’ in IBM’s definitive Proxy Statement to be filed with the Securities and Exchange Commission and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020.][added: 27, 2021.]

| RSUs | ​ | 16,270,098 | ​ | ​ | N/A | ​ | — |

| PSUs | ​ | 5,824,730 | (2) | ​ | N/A | ​ | — |

| Subtotal | ​ | 23,594,828 | ​ | $ | 139.83 | ​ | 67,949,557 |

| RSUs | ​ | 626,606 | ​ | ​ | N/A | ​ | — |

| PSUs | ​ | 212,820 | (2) | ​ | N/A | ​ | — |

| DCEAP shares | ​ | 180,248 | ​ | ​ | N/A | ​ | — |

| Subtotal | ​ | 1,019,673 | ​ | $ | — | ​ | 34,786,258 |

| Total | ​ | 24,614,502 | ​ | $ | 139.83 | ​ | 102,735,815 |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

IBM Red Hat Acquisition Long-Term Performance Plan (the “Red Hat Plan”)

The Red Hat Plan was adopted by the Board of Directors in connection with the company’s acquisition of Red Hat, Inc. on July 9, 2019.

The Red Hat Plan has been and will continue to be used solely to fund awards for employees who were not employed by IBM immediately prior to the closing of the acquisition.

Awards for senior executives of the company will not be funded from the Red Hat Plan.

The terms and conditions of the Red Hat Plan are substantively identical to the terms and conditions of the 2001 Plan, described above.

| RSUs | ​ | 10,765,835 | ​ | ​ | N/A | ​ | — |

| PSUs | ​ | 4,119,972 | (2) | ​ | N/A | ​ | — |

| Subtotal | ​ | 16,385,807 | ​ | $ | 139.83 | ​ | 78,665,928 |

| RSUs | ​ | 560,793 | ​ | ​ | N/A | ​ | — |

| PSUs | ​ | 164,703 | (2) | ​ | N/A | ​ | — |

| DCEAP shares | ​ | 174,195 | ​ | ​ | N/A | ​ | — |

| Subtotal | ​ | 899,691 | ​ | $ | — | ​ | 15,137,333 |

| Total | ​ | 17,285,498 | ​ | $ | 139.83 | ​ | 93,803,261 |

Refer to the information under the captions “IBM Board of Directors,” [removed: “Board] [added: “Governance] and [removed: Governance—Committees] [added: Board—Committees] of the Board” and [removed: “Board] [added: “Governance] and [removed: Governance—Certain] [added: Board—Certain] Transactions and Relationships” in IBM’s definitive Proxy Statement to be filed with the SEC and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] all of which information is incorporated herein by reference.

Refer to the information under the captions “Report of the Audit Committee of the Board of Directors” and “Audit and Non-Audit Fees” in IBM’s definitive Proxy Statement to be filed with the SEC and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] all of which information is incorporated herein by reference.

| | 1. | Financial statements from IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, which are incorporated herein by reference: |

Consolidated Income Statement for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017] [added: 2018] (page 68).

Consolidated Statement of Comprehensive Income for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017] [added: 2018] (page 69).

Consolidated Balance Sheet at December 31, [removed: 2019] [added: 2020] and [removed: 2018] [added: 2019] (page 70).

Consolidated Statement of Cash Flows for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017] [added: 2018] (page 71).

Consolidated Statement of Equity at December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017] [added: 2018] (pages 72 and 73).

Notes to Consolidated Financial Statements (pages 74 through [removed: 138).][added: 140).]

| S-1 | ​ | II | ​ | [Valuation and Qualifying Accounts and Reserves for the years ended December 31, [removed: 2019, 2018] [added: 2020, 2019] and [removed: 2017.](#VALUATIONANDQUALIFYINGACCOUNTSANDRESERVE)] [added: 2018.](#VALUATIONANDQUALIFYINGACCOUNTSANDRESERVE)] |

| ​ | ​ | [The By-Laws of IBM, as amended through [removed: October 29, 2019,] [added: January 1, 2021,] is Exhibit 3.2 to Form [removed: 10-Q for the quarter ended September 30, 2019,] [added: 8-K, filed December 18, 2020,] and is hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000155837019009324/ibm-20190930ex32a17b828.htm)] [added: reference.](https://www.sec.gov/Archives/edgar/data/51143/000110465920137423/tm2038625d2_ex3-2.htm)] | ​ | ​ |

| ​ | ​ | [The By-Laws of IBM, as amended [removed: through] [added: effective] April [removed: 6, 2020.](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-3d2.htm)] [added: 27, 2021.](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex3d2.htm)] | ​ | 3.2 |

| ​ | ​ | [The instrument defining the rights of the holders of the [removed: 2.900%] [added: 0.300%] Notes due [removed: 2021] [added: 2026] is Exhibit [removed: 3.1] [added: 4] to Form [removed: 8-K,] [added: 8-K] filed [removed: October 31, 2011,] [added: November 1, 2016,] and is hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015711000857/ex3-1.htm)] [added: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015716002418/ex-4.htm)] | ​ | ​ |

| ​ | ​ | [The [removed: instruments] [added: instrument] defining the rights of the holders of the 1.875% Notes due 2022 is Exhibit 2.1 to Form 8-K, filed July 27, 2012, and is hereby incorporated by reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015712000302/ex-2.htm) | ​ | ​ |

| ​ | ​ | [The instrument defining the rights of the holders of the [removed: 1.625%] [added: 2.875%] Notes due [removed: 2020] [added: 2025] is Exhibit [removed: 3.1] [added: 3] to Form 8-K, filed [removed: May] [added: November] 6, 2013, and [removed: is] [added: are] hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015713000174/ex-3.htm)] [added: reference.](https://www.sec.gov/Archives/edgar/data/51143/000095015713000398/ex3.htm)] | ​ | ​ |

| ​ | ​ | [The instruments defining the rights of the holders of the [removed: 1.875%] [added: 3.450%] Notes due [removed: 2020] [added: 2026] and [removed: 2.875%] [added: 4.700%] Notes due [removed: 2025] [added: 2046] are Exhibits [removed: 2] [added: 4.4] and [removed: 3] [added: 4.5] to Form [removed: 8-K,] [added: 8-K] filed [removed: November 6, 2013,] [added: February 18, 2016,] and are hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015713000398/0000950157-13-000398-index.htm)] [added: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015716001614/0000950157-16-001614-index.htm)] | ​ | ​ |

| ​ | ​ | [The instruments defining the rights of the holders of the [removed: 2.250%] [added: Floating Rate] Notes due 2021, [removed: 3.450%] [added: the 2.850%] Notes due [removed: 2026] [added: 2022, the 3.000% Notes due 2024, the 3.300% Notes due 2026, the 3.500% Notes due 2029, the 4.150% Notes due 2039] and [removed: 4.700%] [added: the 4.250%] Notes due [removed: 2046] [added: 2049] are Exhibits [added: 4.1,] 4.3, [removed: 4.4] [added: 4.4, 4.5, 4.6, 4.7] and [removed: 4.5] [added: 4.8] to Form [removed: 8-K] [added: 8-K,] filed [removed: February 18, 2016,] [added: May 14, 2019,] and are hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015716001614/0000950157-16-001614-index.htm)] [added: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015719000591/0000950157-19-000591-index.htm)] | ​ | ​ |

| ​ | ​ | [The instruments defining the rights of the holders of the [removed: Floating Rate Notes due 2021, 2.800% Notes due 2021, the 2.850% Notes due 2022. the 3.000% Notes due 2024, the 3.300%] [added: 1.700%] Notes due [removed: 2026,] [added: 2027,] the [removed: 3.500%] [added: 1.950%] Notes due [removed: 2029,] [added: 2030,] the [removed: 4.150%] [added: 2.850%] Notes due [removed: 2039] [added: 2040] and the [removed: 4.250%] [added: 2.950%] Notes due [removed: 2049] [added: 2050] are Exhibits 4.1, 4.2, [removed: 4.3, 4.4, 4.5, 4.6, 4.7] [added: 4.3] and [removed: 4.8] [added: 4.4] to Form 8-K, filed May [removed: 14, 2019,] [added: 6, 2020,] and are hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015719000591/0000950157-19-000591-index.htm)] [added: reference.](https://www.sec.gov/Archives/edgar/data/51143/000095015720000589/0000950157-20-000589-index.htm)] | ​ | ​ |

| ​ | ​ | [Description of Securities Registered under Section 12 of the Exchange [removed: Act](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-4d1.htm)] [added: Act](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex4d1.htm)] | ​ | 4.1 |

| ​ | ​ | [Form of LTPP equity award agreement for performance share units and the terms and conditions of LTPP Equity Awards, effective December 17, 2019, in connection with the foregoing award [removed: agreements.*](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-10d1.htm)] [added: agreements, filed as Exhibit 10.1 to Form 10-K for the year ended December 31, 2019, are hereby incorporated by reference.*](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-10d1.htm)] | ​ | [removed: 10.1] ​ |

| ​ | ​ | Board of Directors compensatory plans, as described under the caption “General [removed: Information—2019] [added: Information—2020] Director Compensation” in IBM’s definitive Proxy Statement to be filed with the Securities and Exchange Commission and delivered to stockholders in connection with the Annual Meeting of Stockholders to be held April [removed: 28, 2020,] [added: 27, 2021,] are hereby incorporated by reference.* | ​ | ​ |

| ​ | ​ | [The IBM Excess 401(k) Plus Plan, a compensatory plan (formerly the IBM Executive Deferred Compensation Plan), as amended and restated through January 1, [removed: 2010, which was filed as Exhibit 10.1 to Form 10-K for the year ended December 31, 2009 contained in Registration Statement No. 333-171968 on Form S-8, is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746910001151/a2195966zex-10_1.htm)] [added: 2021.*](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex10d1.htm)] | ​ | [removed: ​] [added: 10.1] |

| ​ | ​ | [removed: [Amendment No. 2 to the IBM Excess 401(k) Plus Plan, a compensatory plan, effective January 1, 2013 which was] [added: [Form of Noncompetition Agreement,] filed as Exhibit 10.2 to Form 10-K for the year ended December 31, [removed: 2012, and] [added: 2019,] is hereby incorporated by [removed: reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746913001698/a2212340zex-10_2.htm)] [added: reference.*](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-10d2.htm)] | ​ | ​ |

| ​ | ​ | [removed: [Amendment No. 5 to the IBM Excess 401(k) Plus Plan, a compensatory plan,] [added: [Letter] dated [removed: as of] December [removed: 9, 2014, which] [added: 15, 2020, signed by Virginia M. Rometty and IBM] was [removed: filed] [added: included] as Exhibit [removed: 10.2] [added: 99.2] to [removed: Form 10-K for] the [removed: year ended] [added: Form 8-K filed] December [removed: 31, 2014,] [added: 16, 2020,] and is hereby incorporated by [removed: reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746915001106/a2222209zex-10_2.htm)] [added: reference.*](https://www.sec.gov/Archives/edgar/data/51143/000110465920136302/tm2038625d1_ex99-2.htm)] | ​ | ​ |

| ​ | ​ | [Form of Noncompetition [removed: Agreement*](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-10d2.htm)] [added: Agreement.*](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex10d2.htm)] | ​ | 10.2 |

| ​ | ​ | [$2,500,000,000 364-Day Credit Agreement dated as of July [removed: 18, 2019,] [added: 2, 2020,] among International Business Machines Corporation and IBM Credit LLC, as Borrowers, the several lenders and other financial institutions from time to time parties to such agreement, JP Morgan Chase Bank, N.A., as Administrative Agent, BNP Paribas, Citibank N.A., Royal Bank of Canada and Mizuho Bank, Ltd., as Syndication Agents, and the Documentation Agents named therein, filed as Exhibit 10.1 to Form 8-K dated July [removed: 19, 2019,] [added: 2, 2020,] is hereby incorporated by [removed: reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015719000769/ex10-1.htm)] [added: reference.](https://www.sec.gov/Archives/edgar/data/51143/000095015720000842/ex10-1.htm)] | ​ | ​ |

| (13) | ​ | [Annual Report to Security [removed: Holders](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ibm-20191231xex13907c3.htm)] [added: Holders](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex13.htm)] | ​ | 13 |

| (21) | ​ | [Subsidiaries of the [removed: registrant](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-21.htm)] [added: registrant](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex21.htm)] | ​ | 21 |

| (23) | ​ | [Consent of Independent Registered Public Accounting [removed: Firm](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-23d1.htm)] [added: Firm](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex23d1.htm)] | ​ | 23.1 |

| (24) | ​ | [Powers of [removed: attorney](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-24d1.htm)] [added: attorney](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex24d1.htm)] | ​ | 24.1 |

| ​ | ​ | [Resolution of the IBM Board of Directors authorizing execution of this Annual Report on Form 10-K by Powers of [removed: Attorney](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-24d2.htm)] [added: Attorney](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex24d2.htm)] | ​ | 24.2 |

| (31) | ​ | [Certification by CEO pursuant to Rule 13A-14(a) or 15D-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-31d1.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex31d1.htm)] | ​ | 31.1 |

| ​ | ​ | [Certification by CFO pursuant to Rule 13A-14(a) or 15D-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-31d2.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex31d2.htm)] | ​ | 31.2 |

| (32) | ​ | [Certification by CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-32d1.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex32d1.htm)] | ​ | 32.1 |

| ​ | ​ | [Certification by CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837020001334/ex-32d2.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex32d2.htm)] | ​ | 32.2 |

   The Performance [removed: Graphs,] [added: Graph,] set forth on page 141 of IBM’s [removed: 2019] [added: 2020] Annual Report to Stockholders, [removed: are] [added: is] deemed to be furnished but not filed.

| ​ | ​ | [The IBM Red Hat Acquisition Long-Term Performancce Plan, a compensatory plan, contained in Registration Statement No. 333-232585 of Form S-8, as such amended plan was filed as Exhibit 4.8 to Form S-8 POS filed on December 18, 2020, is hereby incorporated by reference.*](https://www.sec.gov/Archives/edgar/data/51143/000110465920137491/tm2038697d1_ex4-8.htm) | ​ | ​ |

| ​ | ​ | [Form of LTPP equity award agreement for performance share units and the terms and conditions of LTPP Equity Awards, effective March 2, 2020, in connection with the foregoing award agreements, filed as Exhibit 10.1 to Form 10-Q for the quarter ended March 31, 2020, are hereby incorporated by reference.*](https://www.sec.gov/Archives/edgar/data/51143/000155837020004491/ibm-20200331ex101b6fe84.htm) | ​ | ​ |

| ​ | ​ | [Terms and Conditions of IBM LTPP Equity Awards, effective June 1, 2020, filed as Exhibit 10.1 to Form 10-Q for the quarter ended June 30, 2020, are hereby incorporated by reference.*](https://www.sec.gov/Archives/edgar/data/51143/000155837020008516/ibm-20200630xex10d1.htm) | ​ | ​ |

| ​ | ​ | [Letter Agreement, signed by James Whitehurst and IBM, dated October 28, 2018*](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex10d3.htm) | ​ | 10.3 |

| ​ | ​ | [Letter Agreement, signed by James Whitehurst and IBM, dated December 12, 2019*](https://www.sec.gov/Archives/edgar/data/51143/000155837021001489/ibm-20201231xex10d4.htm) | ​ | 10.4 |

| ​ | ​ | [Letter dated December 15, 2020, signed by John E. Kelly III and IBM was included as Exhibit 99.1 to the Form 8-K filed December 18, 2020, and is hereby incorporated by reference.*](https://www.sec.gov/Archives/edgar/data/51143/000110465920137423/tm2038625d2_ex99-1.htm) | ​ | ​ |

| ​ | ​ | [First Amendment to the $2,500,000,000 Amended and Restated Three-Year Credit Agreement dated as of July 2, 2020, among International Business Machines Corporation and IBM Credit LLC, as Borrowers, the several lenders from time to time parties to such agreement, JPMorgan Chase Bank, N.A., as Administrative Agent, BNP Paribas, Citibank, N.A., Royal Bank of Canada and Mizuho Bank, Ltd., as Syndication Agents, and the Documentation Agents named therein, filed as Exhibit 10.2 to Form 8-K dated July 2, 2020, is hereby incorporated by reference.](https://www.sec.gov/Archives/edgar/data/51143/000095015720000842/ex10-2.htm) | ​ | ​ |

| ​ | ​ | [First Amendment to the $10,250,000,000 Amended and Restated Five-Year Credit Agreement dated as of July 2, 2020, among International Business Machines Corporation, as the Borrower, the several lenders from time to time parties to such Agreement, JPMorgan Chase Bank, N.A., as Administrative Agent, BNP Paribas, Citibank, N.A., and Royal Bank of Canada and Mizuho Bank, Ltd., as Syndication Agents, and the Documentation Agents named therein, filed as Exhibit 10.3 to Form 8-K dated July 2, 2020, is hereby incorporated by reference.](https://www.sec.gov/Archives/edgar/data/51143/000095015720000842/ex10-3.htm) | ​ | ​ |

| (2) | ​ | Plan of acquisition, reorganization, arrangement, liquidation or succession. | ​ | Not applicable |

| ​ | ​ | [The instrument defining the rights of the holders of the 2.750% Notes due 2020 is Exhibit 2 to Form 8-K, filed November 20, 2013, and is hereby incorporated by reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015713000418/ex2.htm) | ​ | ​ |

| ​ | ​ | [The instrument defining the rights of the holders of the 0.30% Notes due 2026 is Exhibit 4 to Form 8-K filed November 1, 2016, and is hereby incorporated by reference.](http://www.sec.gov/Archives/edgar/data/51143/000095015716002418/ex-4.htm) | ​ | ​ |

| (9) | ​ | Voting trust agreement | ​ | Not applicable |

| ​ | ​ | [Amendment No. 1 to the IBM Excess 401(k) Plus Plan, a compensatory plan, effective January 1, 2013 which was filed as Exhibit 10.1 to Form 10-K for the year ended December 31, 2012, and is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746913001698/a2212340zex-10_1.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 3 to the IBM Excess 401(k) Plus Plan, a compensatory plan, effective January 1, 2013 which was filed as Exhibit 10.2 to Form 10-K for the year ended December 31, 2013, and is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746914001302/a2217495zex-10_2.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 4 to the IBM Excess 401(k) Plus Plan, a compensatory plan, dated as of February 25, 2014, which was filed as Exhibit 10.1 to Form 10-Q for the quarter ended March 31, 2014, and is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000005114314000004/ibm14q1_ex10d1.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 6 to the IBM Excess 401(k) Plus Plan, a compensatory plan, dated as of December 18, 2015, which was filed as Exhibit 10.1 to Form 10-K for the year ended December 31, 2015, and is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746916010329/a2226548zex-10_1.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 7 to the IBM Excess 401(k) Plus Plan, a compensatory plan, dated as of June 30, 2016, which was filed as Exhibit 10.2 to Form 10-Q for the quarter ended June 30, 2016, and is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000110465916134367/a16-12780_1ex10d2.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 8 to the IBM Excess 401(k) Plus Plan, a compensatory plan, dated as of December 31, 2017, which was filed as Exhibit 10.2 to Form 10-K for the year ended December 31, 2017, is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746918001117/a2233835zex-10_2.htm) | ​ | ​ |

| ​ | ​ | [Amendment No. 9 to the IBM Excess 401(k) Plus Plan, a compensatory plan, dated as of December 18, 2018, which was filed as Exhibit 10.1 to Form 10-K for the year ended December 31, 2018, is hereby incorporated by reference.*](http://www.sec.gov/Archives/edgar/data/51143/000104746919000712/a2237254zex-10_1.htm) | ​ | ​ |

| (18) | ​ | Letter re: change in accounting principles | ​ | Not applicable |

| (28) | ​ | Information from reports furnished to state insurance regulatory authorities | ​ | Not applicable |

| ​ | ​ | _Chairman of the [removed: Board,_] [added: Board_] |

| ​ | ​ | [removed: _President and] [added: _and] Chief Executive Officer_ |

| *​* | *​* | _Date: February [removed: 25, 2020_] [added: 23, 2021_] |

| [added: ​ ​ ​ ​] /s/ [removed: VIRGINIA M. ROMETTY] [added: ARVIND KRISHNA] | ​ | [added: ​ ​ ​ ​] Chairman of the Board, [removed: President] and Chief Executive Officer | ​ | [added: ​ ​ ​] February [removed: 25, 2020] [added: 23, 2021] |

| /s/ JAMES J. KAVANAUGH | ​ | Senior Vice President and Chief Financial Officer, Finance and Operations | ​ | February [removed: 25, 2020] [added: 23, 2021] |

| James J. Kavanaugh | ​ | [removed: ​] | ​ | [removed: ​] |

| /s/ ROBERT F. DEL BENE | ​ | Vice President and Controller (Chief Accounting Officer) | ​ | February [removed: 25, 2020] [added: 23, 2021] |

| Robert F. Del Bene | ​ | [removed: ​] | ​ | [removed: ​] |

| Michael L. Eskew | Director | ​ | [removed: _Attorney-in-fact_ February 25, 2020] [added: ​] |

Our audits of the consolidated financial statements referred to in our report dated February [removed: 25, 2020] [added: 23, 2021] appearing in the [removed: 2019] [added: 2020] Annual Report to Stockholders of International Business Machines Corporation (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the financial statement schedule listed in Item 15(a)(2) of this Form 10-K.

[removed: February 25, 2020][added: | 2020 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |]

| —Noncurrent | ​ | $ | [removed: 101] [added: 56] | [removed: ​] [added: *] | $ | [removed: (10)] [added: 4] | ​ | $ | [removed: (42)] [added: (0)] | ​ | $ | [removed: 26] [added: (13)] | ​ | $ | [removed: 74] [added: 47] |

| 2018 | ​ | $ | 451 | ​ | $ | 897 | [removed: *] [added: ​] | $ | (828) | [removed: *] [added: ​] | $ | (20) | [removed: *] [added: ​] | $ | 500 |

1 of 2

| ​ | By: | /s/ ARVIND KRISHNA |

| ​ | ​ | Arvind Krishna |

| Arvind Krishna | ​ | | ​ | |

| ​ ​ ​ ​ | ​ | ​ ​ ​ | ​ | ​ ​ ​ |

| ​ | ​ | ​ | ​ | ​ ​ ​ ​ |

2 of 2

Board of Directors

| Thomas Buberl | Director | ​ | _Attorney-in-fact_ February 23, 2021 |

February 23, 2021

​

| —Current | ​ | $ | 556 | * | $ | 104 | ​ | $ | (85) | ​ | $ | 23 | ​ | $ | 597 |

| 2020 | ​ | $ | 490 | ​ | $ | 135 | ​ | $ | (125) | ​ | $ | 15 | ​ | $ | 514 |

| 2020 | ​ | $ | 498 | ​ | $ | 774 | ​ | $ | (755) | ​ | $ | 4 | ​ | $ | 522 |

* Opening balance does not equal the allowance at December 31, 2019 due to the adoption of the guidance for current expected credit losses.

| ​ | By: | /s/ VIRGINIA M. ROMETTY |

| ​ | ​ | Virginia M. Rometty |

| Virginia M. Rometty | ​ | ​ | ​ | ​ |

| ​ | ​ | ​ | ​ | ​ |

| Shirley Ann Jackson | Director | ​ | ​ |

| 2017 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| —Current | ​ | $ | 675 | ​ | $ | 65 | ​ | $ | (157) | ​ | $ | 11 | ​ | $ | 594 |

| 2017 | ​ | $ | 525 | ​ | $ | 164 | ​ | $ | (139) | ​ | $ | 23 | ​ | $ | 574 |

| 2017 | ​ | $ | 481 | ​ | $ | 1,006 | * | $ | (1,056) | * | $ | 20 | * | $ | 451 |

*     Reclassifed to conform to 2019 presentation.