( BW)(NY-IBM)(IBM) IBM Board Approves 33 Percent Increase in Quarterly
Cash Dividend; Authorizes $15 Billion for Stock Repurchase

    Business Editors

    KNOXVILLE, Tenn.--(BUSINESS WIRE)--April 24, 2007--(NYSE: IBM) The
IBM board of directors today declared a regular quarterly cash
dividend of $0.40 per common share, payable June 9, 2007 to
stockholders of record May 10, 2007.

    Today's dividend declaration represents an increase of $0.10, or
33 percent more than the prior quarterly dividend of $0.30 per common
share. In the last two years IBM has doubled its quarterly dividend.

    This is the 12th year in a row that IBM has increased its
quarterly cash dividend, representing a total increase of 540 percent
since 1996.

    With the payment of the June 9 dividend, IBM will have paid 366
consecutive quarterly dividends, starting in 1916.

    The board also authorized $15 billion in additional funds for use
in the company's stock repurchase program. This amount is in addition
to approximately $1.4 billion for stock repurchase remaining at the
end of March from a prior authorization. With this new approval, IBM
now has approximately $16.4 billion for its stock repurchase program.
IBM may repurchase shares on the open market or in private
transactions, including structured or accelerated transactions,
depending on market conditions.

    "These announcements underscore the strength of IBM's business
model and our strategy. Over the past several years we have taken
strategic actions to capture our industry's profitable growth
opportunities and to globally integrate IBM," said Samuel J.
Palmisano, IBM chairman, president and chief executive officer. "This
gives us significant financial flexibility to use our capital to drive
growth through investments in acquisitions and capital expenditures,
and to increase returns to shareholders through dividends and stock
repurchase, as we are doing today."

    IBM said it may complete a substantial portion of the repurchases
during the next several months. The company said that, as a result of
the increased share repurchase, 2007 earnings per share growth --
excluding any gain from the recently-announced sale of its printer
business -- could be 12 to 14 percent, which is one to three points
more than its previous estimates. At this time, IBM does not
anticipate requesting board approval for additional funds for stock
repurchases within the next 12 months.

    Additional information about this share repurchase activity,
including the associated financial leverage, is available on IBM's
investor web site at
http://www.ibm.com/investor/viewpoint/ircorner/2007/07-04-24-1.phtml

    --30--SM/ny*

    CONTACT: IBM
             Patricia Murphy, 914-499-5800.