(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 10, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the three months ended June 30, 2018:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(347)	$	(158)	$	(505)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	0	$	0	$	0
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	0	$	0	$	0
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(149)	$	38	$	(111)
Reclassification of (gains)/losses to:
Cost of services		(9)		2		(7)
Cost of sales		6		(2)		5
Cost of financing*		20		(5)		15
SG&A expense		3		(1)		2
Other (income) and expense		397		(100)		297
Interest expense*		18		(4)		13
Total unrealized gains/(losses) on cash flow hedges	$	285	$	(71)	$	214
Retirement-related benefit plans⁽¹⁾:
Prior service costs/(credits)	$	0	$	0	$	0
Net (losses)/gains arising during the period		82		(23)		59
Curtailments and settlements		6		(2)		4
Amortization of prior service (credits)/costs		(19)		5		(13)
Amortization of net (gains)/losses		741		(207)		534
Total retirement-related benefit plans	$	810	$	(226)	$	584
Other comprehensive income/(loss)	$	748	$	(455)	$	294

* Reclassified to conform to current period presentation.

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 10, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the six months ended June 30, 2019:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	176	$	38	$	214
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	(3)	$	1	$	(2)
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	(3)	$	1	$	(2)
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(359)	$	87	$	(272)
Reclassification of (gains)/losses to:
Cost of services		(29)		8		(22)
Cost of sales		(30)		8		(21)
Cost of financing		53		(13)		40
SG&A expense		(34)		9		(25)
Other (income) and expense		(115)		29		(86)
Interest expense		86		(22)		64
Total unrealized gains/(losses) on cash flow hedges	$	(429)	$	106	$	(323)
Retirement-related benefit plans⁽¹⁾:
Net (losses)/gains arising during the period	$	113	$	(24)	$	89
Curtailments and settlements		4		0		4
Amortization of prior service (credits)/costs		(6)		1		(5)
Amortization of net (gains)/losses		924		(252)		671
Total retirement-related benefit plans	$	1,035	$	(275)	$	760
Other comprehensive income/(loss)	$	779	$	(131)	$	649

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 10, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the six months ended June 30, 2018:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(513)	$	(106)	$	(620)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	(2)	$	0	$	(1)
Reclassification of (gains)/losses to other (income) and expense		0		0		0
Total net changes related to available-for-sale securities	$	(2)	$	0	$	(1)
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(89)	$	29	$	(60)
Reclassification of (gains)/losses to:
Cost of services		(28)		7		(21)
Cost of sales		23		(6)		17
Cost of financing*		38		(9)		28
SG&A expense		21		(6)		15
Other (income) and expense		293		(74)		219
Interest expense*		34		(9)		25
Total unrealized gains/(losses) on cash flow hedges	$	292	$	(68)	$	224
Retirement-related benefit plans⁽¹⁾:
Prior service costs/(credits)	$	(1)	$	0	$	(1)
Net (losses)/gains arising during the period		84		(23)		61
Curtailments and settlements		6		(2)		4
Amortization of prior service (credits)/costs		(37)		10		(27)
Amortization of net (gains)/losses		1,494		(410)		1,084
Total retirement-related benefit plans	$	1,545	$	(424)	$	1,121
Other comprehensive income/(loss)	$	1,322	$	(598)	$	724

* Reclassified to conform to current period presentation.

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 10, “Retirement-Related Benefits,” for additional information.

Accumulated Other Comprehensive Income/(Loss) (net of tax)


					Net Change		Net Unrealized
	Net Unrealized		Foreign		Retirement-		Gains/(Losses)		Accumulated
	Gains/(Losses)		Currency		Related		on Available-		Other
	on Cash Flow		Translation		Benefit		For-Sale		Comprehensive
(Dollars in millions)	Hedges		Adjustments*		Plans		Securities		Income/(Loss)
January 1, 2019	$	284	$	(3,690)	$	(26,083)	$	0	$	(29,490)
Other comprehensive income before reclassifications		(272)		214		89		(2)		29
Amount reclassified from accumulated other comprehensive income		(51)		—		671		—		620
Total change for the period	$	(323)	$	214	$	760	$	(2)	$	649
June 30, 2019	$	(39)	$	(3,477)	$	(25,323)	$	(2)	$	(28,841)

* Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.


					Net Change		Net Unrealized
	Net Unrealized		Foreign		Retirement-		Gains/(Losses)		Accumulated
	Gains/(Losses)		Currency		Related		on Available-		Other
	on Cash Flow		Translation		Benefit		For-Sale		Comprehensive
(Dollars in millions)	Hedges		Adjustments*		Plans		Securities		Income/(Loss)
January 1, 2018	$	35	$	(2,834)	$	(23,796)	$	3	$	(26,592)
Cumulative effect of a change in accounting principle^**		5		46		(2,471)		(2)		(2,422)
Other comprehensive income before reclassifications		(60)		(620)		64		(1)		(617)
Amount reclassified from accumulated other comprehensive income		284		—		1,057		—		1,340
Total change for the period	$	224	$	(620)	$	1,121	$	(1)	$	724
June 30, 2018	$	264	$	(3,408)	$	(25,146)	$	0	$	(28,290)

* Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.

** Reflects the adoption of the FASB guidance on stranded tax effects, hedging and financial instruments. Refer to note 2, “Accounting Changes.”

Stock Repurchases

The Board of Directors authorizes the company to repurchase IBM common stock. At June 30, 2019, $2,123 million of Board common stock repurchase authorization was available. The company had previously announced its intent to suspend its share repurchase program in 2020 and 2021 in order to reduce debt that it had issued to finance the Red Hat acquisition. The share repurchase program was suspended on July 9, 2019, which was earlier than the company previously stated.