IBM has been living for decades that no one could kill COBOL. Anthropic has other plans

IBM shares fell about 13.2% yesterday on the New York Stock Exchange for a simple reason: Anthropic advertisement that its AI model, Claude, can be used to modernize systems that are based on the legendary COBOL programming language. And that is something that seemed virtually impossible.

The immortal language. As Anthropic itself indicates, it is estimated that COBOL manages 95% of all transactions made at ATMs in the US. A 2022 study revealed that there are 800 billion lines of COBOL code that continue to operate in production systems on a daily basis.

That almost no one uses anymore. Faced with this reality is another equally powerful one: almost no one programs in COBOL anymore, because this language has been with us for 65 years and has ended up being replaced by modern programming languages. The question, of course, is who is in charge of those millions of lines of code if there are almost no human programmers who can do it. Anthropic itself made it clear: “the number of people who understand COBOL decreases every year.”

AI to the rescue. That’s where Claude, Anthropic’s family of generative AI models, comes in. According to this company, Claude is now capable of “modernizing” COBOL despite how difficult and expensive it was to carry out something like that. IBM has been trying for years and in fact applied that same recipebut its AI (Watson) does not seem to have managed too much progress.

Claude helps, but there must be a human expert supervising. At Anthropic they promise that their AI model is capable of reading the entire code base of a COBOL project, identifying entry points, execution paths through subroutines, mapping data flows and documenting dependencies. They highlight, however, that with the supervision of a human expert this can help modernize and polish all types of COBOL-based systems.

Critical systems. Of course, the question is whether AI will actually deliver on that promise, especially when we’re talking about absolutely critical systems used in financial transactions. According to Anthropic “the modernization of the code legacy It has been stagnant for years because understanding it cost more than rewriting it. “AI reverses that equation.”

COBOL is no longer IBM’s ace in the hole. It’s hard to know how much of IBM’s business depended on COBOL systems, but it’s certainly a relevant part.

• In 2025 the company achieved revenue of $67.5 billion.
• About 45% comes from software.
• The rest is consulting and infrastructure, and this last division is where the IT business is included. IBM Z mainframesclosely linked to COBOL systems.
• It’s reasonable to think that revenues dependent on mainframes and COBOl are around 20% of IBM’s revenues (and probably more in profits).

AI and the SaaSpocalypse. What happened with IBM and COBOL is the latest case of a software that seemed to have a long-term future but with AI may not have such a long-term future. Investors now seem to think that AI will replace many of these systems and SaaS platforms. It is indeed what has been called “SaaSpocalypse” in reference to the stock market falls of this type of companies in recent months: Salesforce, SAP, Microsoft, Adobe, Intuit and Atlassian have suffered notable falls in the stock market that are around 30-40% on average.

But. This investor panic that is being experienced contrasts with the current reality: AI models are proving to be able to do surprising things in the field of programming, but they are far from being perfect. The code must be reviewed, and IBM itself he already made it clear In a 1979 training manual:

“A computer can never be held responsible. Therefore, it should never make an administrative decision.”

IBM has already survived other crises. The blue giant has suffered a blow to the stock market, but it is one of those technology companies that have managed to recover and resist all the attacks of an industry that is normally merciless. IBM itself also has its modernization solutions for its clients, and some analysts they are clear that in fact IBM will make more money than before if COBOL finally goes away.

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