Technology

IBM Watson Dies at CES as Shares Near 52-Week Low

Douglas A. McIntyre

Published: January 8, 2016 6:47 am

Last Updated: January 13, 2020 3:18 pm

International Business Machines Corp. (NYSE: IBM) CEO Ginni Rometty gave a keynote speech at the Consumer Electronics Show (CES) in which she said the company’s Watson, the artificial intelligence (AI) process, will change the world. Wall Street did not agree. IBM’s shares are off nearly 6% over the past month and 17% over the past year.

The most memorable statement by Rometty was that AI computer technology will “change the way you are.” IBM has not lined up enough large customers for Watson and its related software to support that. While the company says approximately 80,000 programmers have put Watson into apps and other software, IBM has little to show in terms of revenue.

The best IBM could do at CES was a marriage of Watson with athletic gear company Under Armour Inc. (NYSE: UA). In a press release, the two firms stated they would:

… create and provide meaningful data-backed health and fitness insights, powered by IBM Watson’s cognitive computing technology. Under Armour’s new UA Record™ combined with a Cognitive Coaching System will serve as a personal health consultant, fitness trainer and assistant by providing athletes with timely, evidence-based coaching around your sleep, fitness, activity and nutrition, including outcomes achieved based on others “like you.”

If that is the most important partnership IBM can use to boast about Watson adoption in a CES keynote, the tech company has a long way to go.

The purpose of keynote speeches at CES is to announce meaningful and substantial advances in a company’s products and plans. Netflix Inc. (NASDAQ: NFLX) CEO Reed Hastings announced that its streaming service is available in over 130 countries. He described it as the “birth of a new global internet TV network.” The number of countries justifies the excitement.

Watson may be the software product of the future. However, so far, it is barely more than a demonstration tool for an IBM initiative that has not improved the company’s fortunes enough for investors to believe IBM has much of a future.