IBM transfers $6B pension obligations to Prudential; expects $2.7B pre-tax settlement charge

INTERNATIONAL BUSINESS MACHINES CORP

Transaction closed Sept 11, 2024; covers ~32,000 participants receiving benefits initiated before 2016.
Non-cash pre-tax charge of ~$2.7B ($2.0B net of tax) in Q3 2024; not in prior GAAP guidance.
No impact on Q3 or FY 2024 operating (non-GAAP) profit or free cash flow; funded from Plan assets, no cash from IBM.
Prudential assumes irrevocable responsibility for benefit payments from Jan 1, 2025; benefit amounts unchanged.

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