(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 September 30, 2018:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(22)	$	(22)	$	(44)
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	$	(46)	$	11	$	(35)
Reclassification of (gains)/losses to:
Cost of services		(1)		0		(1)
Cost of sales		(8)		3		(6)
Cost of financing*		18		(5)		14
SG&A expense		(7)		2		(5)
Other (income) and expense		8		(2)		6
Interest expense*		18		(5)		14
Total unrealized gains/(losses) on cash flow hedges	$	(18)	$	4	$	(14)
Retirement-related benefit plans (1):
Prior service costs/(credits)	$	0	$	0	$	0
Net (losses)/gains arising during the period		(1)		1		(1)
Curtailments and settlements		2		0		1
Amortization of prior service (credits)/costs		(18)		5		(13)
Amortization of net (gains)/losses		737		(196)		540
Total retirement-related benefit plans	$	719	$	(191)	$	527
Other comprehensive income/(loss)	$	678	$	(209)	$	470

* 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 nine months ended September 30, 2019:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(333)	$	(72)	$	(405)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	1	$	0	$	1
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	1	$	0	$	1
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(798)	$	196	$	(601)
Reclassification of (gains)/losses to:
Cost of services		(52)		13		(38)
Cost of sales		(40)		11		(29)
Cost of financing		73		(18)		55
SG&A expense		(45)		12		(33)
Other (income) and expense		331		(83)		248
Interest expense		150		(38)		112
Total unrealized gains/(losses) on cash flow hedges	$	(380)	$	93	$	(287)
Retirement-related benefit plans (1):
Net (losses)/gains arising during the period	$	113	$	(23)	$	90
Curtailments and settlements		7		(1)		6
Amortization of prior service (credits)/costs		(9)		4		(5)
Amortization of net (gains)/losses		1,385		(380)		1,005
Total retirement-related benefit plans	$	1,496	$	(401)	$	1,095
Other comprehensive income/(loss)	$	784	$	(380)	$	404

(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 nine months ended September 30, 2018:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(535)	$	(128)	$	(663)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	(2)	$	1	$	(1)
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	(2)	$	1	$	(1)
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(134)	$	39	$	(95)
Reclassification of (gains)/losses to:
Cost of services		(29)		7		(22)
Cost of sales		15		(4)		11
Cost of financing*		56		(14)		42
SG&A expense		14		(4)		10
Other (income) and expense		301		(76)		225
Interest expense*		52		(13)		39
Total unrealized gains/(losses) on cash flow hedges	$	274	$	(63)	$	210
Retirement-related benefit plans (1):
Prior service costs/(credits)	$	(1)	$	0	$	(1)
Net (losses)/gains arising during the period		83		(22)		60
Curtailments and settlements		7		(2)		5
Amortization of prior service (credits)/costs		(55)		15		(40)
Amortization of net (gains)/losses		2,231		(607)		1,624
Total retirement-related benefit plans	$	2,264	$	(616)	$	1,648
Other comprehensive income/(loss)	$	2,001	$	(807)	$	1,194

* 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		(601)		(405)		89		1		(916)
Amount reclassified from accumulated other comprehensive income		315		—		1,005		—		1,320
Total change for the period	$	(287)	$	(405)	$	1,095	$	1	$	404
September 30, 2019	$	(3)	$	(4,095)	$	(24,988)	$	0	$	(29,086)

* 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		(95)		(663)		65		(1)		(695)
Amount reclassified from accumulated other comprehensive income		305		—		1,584		—		1,889
Total change for the period	$	210	$	(663)	$	1,648	$	(1)	$	1,194
September 30, 2018	$	250	$	(3,451)	$	(24,618)	$	0	$	(27,820)

* 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 September 30, 2019, $2,008 million of Board common stock repurchase authorization was available. The company suspended its share repurchase program effective with the close of the Red Hat acquisition in order to focus on reducing debt related to the acquisition.