Canadian Halal Investor.

NYSE Shariah screener · October 2026

Is International Business Machines Corporation (IBM) Halal?

PASS

International Business Machines Corporation · NYSE: IBM · Technology

The short answer

Yes — IBM passes this Shariah stock screen, but the result is borderline and contested — read the debt section before deciding anything. The Armonk-based hybrid cloud, software, consulting and infrastructure company has no prohibited industry, and its Financing segment (client loans and leases; $16,184M net financing receivables) is ~1.09% of revenue — under the 5% non-compliant-segment tolerance. Its debt of $61,260M is about 29.29% of its ~$209.1B market cap ($225.62, October 1, 2026): below the ~33% ceiling, but essentially on AAOIFI's 30% line, and Musaffa Academy flags IBM as Not Halal for debt-to-market-cap ratios exceeding AAOIFI limits. Interest income of $705M is about 1.04% of FY2025 revenue ($67,535M), below the 5% ceiling. Zoya rates IBM Shariah-compliant and ShariaPortfolio rates it compliant (3/5 standards). Published as PASS with the Musaffa disagreement disclosed rather than hidden — this is a factual screen, not a religious ruling; consult a qualified scholar for personal rulings.

Gate 1 — Business activity: PASS

International Business Machines Corporation (NYSE: IBM), headquartered in Armonk, New York, describes itself as a provider of global hybrid cloud and AI, software, consulting and infrastructure, operating in 175+ countries and serving 95% of the Fortune 500. Per its FY2025 10-K it reports four segments: Software (~45% of revenue — hybrid cloud, AI, Red Hat, watsonx; +9% at constant currency in 2025), Consulting (AI-enabled workflow transformation; flat in 2025), Infrastructure (z17 mainframe, servers, storage; +10% in 2025) and Financing. FY2025 total revenue: $67,535M; ~270,000–300,000 employees. Financing segment (factual, from the filing): "Financing is a reportable segment that facilitates IBM clients' acquisition of hardware, software and services by providing financing solutions" — financing receivables consist of client loan and installment payment receivables (loans) and sales-type/direct financing leases: net financing receivables $16,184M at Dec 31, 2025 (up $2,728M YoY on z17 cycle strength). Financing segment revenue $737M in 2025 (~1.09% of total revenue) — under the 5% non-compliant-segment tolerance. No alcohol, pork, gambling, tobacco, adult entertainment, conventional insurance, or weapons segments; no defense segment reported. Gate 1 passes — borderline on the Financing segment, disclosed rather than hidden. Facts only.

Gate 2 — Debt and cash: PASS

Per IBM's FY2025 10-K (year ended December 31, 2025, filed February 24, 2026), total debt was $61,260M (MD&A: "Total debt of $61,260 million increased $6,287 million compared to December 31, 2024, primarily composed of intercompany loans" supporting the Financing book). Against a market cap of about $209.1B ($225.62, October 1, 2026), debt ÷ market cap is about 29.29% — below the ~33% ceiling, but essentially on AAOIFI's 30% line and the second-highest debt ratio among the recent US-expansion passes. Musaffa's Academy flags IBM as Not Halal for debt-to-market-cap ratios exceeding AAOIFI limits — their screen may use different timing/inputs (e.g. trailing-average market cap; IBM's price fell 23.83% YTD, which mechanically inflates the ratio). Cash, restricted cash and marketable securities of $14,470M are about 6.92% of market cap. Gate 2 passes under the site's ceiling; the Musaffa disagreement is disclosed rather than hidden. Facts only.

Gate 3 — Non-compliant income: PASS

Per IBM's FY2025 10-K Management System Segment View, Financing-segment interest income was $705M against total revenue of $67,535M — about 1.04% of revenue, below the 5% non-compliant income ceiling. (Zoya's page cites $645M = 0.96% — close to the 10-K's figure; the 10-K is authoritative.) Financing segment revenue of $737M is about 1.09% of total revenue — under the 5% non-compliant-segment tolerance. Net interest excluding the Financing segment was $(1,312)M (net interest expense); interest expense is not a screen input. Gate 3 passes. Facts only.

Key figures used

Frequently asked questions

What does IBM do?

International Business Machines Corporation (NYSE: IBM), headquartered in Armonk, New York, describes itself as a provider of global hybrid cloud and AI, software, consulting and infrastructure, operating in 175+ countries and serving 95% of the Fortune 500. Per its FY2025 10-K it reports four segments: Software (~45% of revenue — hybrid cloud, AI, Red Hat, watsonx; +9% at constant currency in 2025), Consulting (AI-enabled workflow transformation; flat in 2025), Infrastructure (z17 mainframe, servers, storage; +10% in 2025) and Financing. FY2025 total revenue was $67,535M; ~270,000–300,000 employees. Shares outstanding ~942M.

Why does IBM pass this Shariah stock screen — and why is it contested?

IBM passes this screen, but the result is borderline and contested — read this section carefully. Its business has no prohibited industry (software, consulting, infrastructure; its Financing segment is an interest-based captive financing business at ~1.09% of revenue, under the 5% segment tolerance — disclosed below). Total debt of $61,260M is about 29.29% of its ~$209.1B market cap — below the ~33% ceiling, but essentially on AAOIFI's 30% line, and Musaffa's Academy flags IBM as Not Halal for debt-to-market-cap ratios exceeding AAOIFI limits. Interest income of $705M is about 1.04% of FY2025 revenue ($67,535M), below the 5% ceiling. Zoya rates IBM Shariah-compliant and ShariaPortfolio rates it compliant (3/5 standards). Published as PASS with the Musaffa disagreement disclosed rather than hidden. This is a factual screen, not a religious ruling — consult a qualified scholar for personal rulings.

What is IBM's interest-bearing debt ratio?

Per IBM's FY2025 10-K (year ended December 31, 2025, filed February 24, 2026), total debt was $61,260M (MD&A: "Total debt of $61,260 million increased $6,287 million compared to December 31, 2024, primarily composed of intercompany loans" supporting the Financing book). Against a market cap of about $209.1B ($225.62, October 1, 2026), debt ÷ market cap is about 29.29% — below the ~33% ceiling but essentially on AAOIFI's 30% line, and the second-highest debt ratio among the recent US-expansion passes. Musaffa's Academy flags IBM as Not Halal on debt-to-market-cap exceeding AAOIFI limits (their screen may use different timing/inputs, e.g. trailing-average market cap; IBM's price fell 23.83% YTD, which mechanically inflates the ratio). Cash, restricted cash and marketable securities of $14,470M are about 6.92% of market cap. The debt gate passes under the site's ceiling; the Musaffa disagreement is stated prominently rather than hidden.

What is IBM's non-compliant income ratio?

Per IBM's FY2025 10-K Management System Segment View, Financing-segment interest income was $705M against total revenue of $67,535M — about 1.04% of revenue, below the 5% non-compliant income ceiling. (Zoya's page cites $645M = 0.96% — close to the 10-K's figure; the 10-K is authoritative.) Financing segment revenue of $737M is about 1.09% of total revenue — under the 5% non-compliant-segment tolerance on this site's own methodology. Net interest excluding the Financing segment was $(1,312)M (net interest expense); interest expense is not a screen input.

Do Zoya, Musaffa, or ShariaPortfolio cover IBM?

Zoya covers IBM (zoya.finance/stocks/ibm): "As of October 2026, IBM is Shariah-compliant and therefore considered halal to invest in" (AAOIFI; the usual auto-template caveat applies). ShariaPortfolio covers IBM (spscreener.mxcorporate.com/stock/ibm-international-business-machines-corp/): "International Business Machines Corp is Shariah Compliant. It passes 3/5 Shariah standards." Musaffa: no per-ticker musaffa.com/stock/IBM page surfaced, but Musaffa Academy's Dow Jones halal-stocks list states "Verizon and IBM are flagged Not Halal due to debt-to-market-cap ratios that exceed AAOIFI limits" — a Musaffa-published source, disclosed here rather than hidden. This page applies the screen directly from IBM's own filings.

Sources

Screened 2026-10-01 from published company figures and market data. Figures change; this page is educational, not financial advice and not a religious ruling.

Screened with our two-gate Shariah screening methodology (business-activity gate, then AAOIFI-style financial ratios).