Anthropic shakes up the market again: IBM plunges 13%, the biggest drop in 25 years, cybersecurity stocks hit hard again

IBM stock price on Monday recorded its worst single-day performance in over 25 years, after AI startup Anthropic announced that its Claude Code tool can assist in modernizing Cobol.

IBM’s stock closed down 13.15% at $223.35 on Monday. This decline marked the largest single-day drop since October 2000. With this fall, IBM’s stock has fallen a total of 27% since February, potentially marking the largest monthly decline since at least 1968.

COBOL, which stands for Common Business-Oriented Language, is a programming language developed in the late 1950s that has dominated business data processing. It is widely used in payment processing and retail transaction systems. Anthropic states that approximately 95% of ATM transactions in the U.S. use COBOL, making it a key area for AI-driven disruption at lower costs.

On Monday, Anthropic announced that Claude Code can automate the most complex exploration and analysis tasks involved in modernizing COBOL. In a blog post, Anthropic wrote:

“Historically, modernizing COBOL systems often required a large number of consultants and years to streamline workflows. Tools like Claude Code can automate much of the exploration and analysis phase that accounts for most of the workload in COBOL modernization.”

“Billions of lines of COBOL code run in production daily, supporting critical systems in finance, aviation, and government. Yet, the number of people who truly understand this language is decreasing year by year.”

“AI excels at simplifying tasks that have historically made COBOL modernization prohibitively expensive.”

Most large mainframes running COBOL are manufactured by IBM. Media reports suggest that this sell-off makes IBM the latest company under heavy pressure due to concerns that AI will suppress growth prospects for traditional enterprises.

A significant portion of IBM’s revenue still relates to its mainframe business. These large servers, owned by clients, run some applications based on COBOL. COBOL is an older language than most mainstream programming languages in today’s tech industry. Mainframes remain favored by clients with strict requirements for high reliability, such as financial institutions and government agencies.

Anthropic states that Claude Code can help modernize COBOL codebases by analyzing dependencies among thousands of lines of code, documenting workflows, and identifying potential risks. These tasks, if done manually, could take months to complete.

The blog notes:

“Traditional code modernization has stagnated for years because understanding legacy code often costs more than rewriting it. AI is changing that calculation.”

Cybersecurity stocks tumble again

Since the start of the year, software stocks have generally underperformed amid concerns over AI-driven disruption risks.

Last Friday, Anthropic launched a new security feature called Claude Code Security for its Claude AI model, triggering a broad sell-off in cybersecurity stocks. Anthropic said the feature can scan codebases for security vulnerabilities and identify software flaws for manual review.

On Monday, cybersecurity concept stocks declined for the second consecutive trading day. CrowdStrike and Zscaler each fell about 10%, while Netskope dropped over 12%. SailPoint declined 9.4%, and Okta, SentinelOne, and Fortinet each fell more than 4%. Palo Alto Networks declined 3%, while Cloudflare, which recently benefited from the Moltbot craze, plummeted 9.6%. The iShares Cybersecurity and Technology ETF fell 4.65%, and the Global X Cybersecurity ETF dropped to its lowest level since November 2023.

The heavy sell-off was driven by companies like Anthropic, OpenAI, and Alphabet launching new AI tools. Investors worry that “vibe code” capabilities—using AI to write software—will enable users to create applications independently, reducing demand for traditional products and putting pressure on corporate growth, profit margins, and pricing power.

Evercore ISI analyst Amit Daryanani wrote:

“We understand why the market might see mainframe migration as a potential negative for IBM, but we want to point out that IBM already offers multiple modernization options for clients. Our view is that clients could have migrated away from mainframes but have chosen to stay on the platform.”

In fact, services that make COBOL easier to use are not new—many large tech firms have launched similar products. IBM itself released a tool in 2023 that uses AI to process COBOL, including updating COBOL to more popular and modern languages like Java.

IBM CEO Arvind Krishna stated in July 2025 that IBM’s AI coding assistant for mainframes “has seen very widespread adoption.” He said that, in most cases, clients use the tool to understand their COBOL codebases and decide which parts need modernization.

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