IBM has AI on its mind and plans to acquire Confluent, a data streaming company built on Apache Kafka, in an $11 billion deal.
The deal announced today (Dec. 8) will see IBM buy all of Confluent’s remaining stock for $31 per share, bringing under its wing the platform used by thousands of organizations to move, process and manage data in real-time.
The move reflects a rapidly intensifying race among tech giants to bolster the data foundations needed for generative and agentic AI. With IDC projecting more than a billion new logic applications to emerge by 2028, enterprises face enormous pressure to unify data scattered across hybrid environments. Real-time data availability is increasingly seen as critical for AI systems that must operate autonomously, respond reliably, and integrate across legacy and cloud-native architectures.
In an announcement, IBM CEO Arvind Krishna called the deal a strategic leap toward building what the company calls a smart data platform for enterprise artificial intelligence. “Together, IBM and Confluent will enable enterprises to deploy generative and agent AI better and faster by ensuring trusted communication and data flow between environments, applications and APIs,” said Krishna. “With the acquisition of Confluent, IBM will provide a smart data platform for enterprise IT that is purpose-built for AI.”
Why concurrency matters
Founded by the original creators of Kafka, Confluent is a platform used for streaming data across industries. IBM says it provides tools to ensure that data remains clean, connected and reliable as it flows across applications – conditions that are increasingly important for AI models whose performance depends on timely and trusted information.
The company’s market has expanded in recent years, doubling its total addressable market from $50 billion in 2021 to $100 billion in 2025.
For IBM, the acquisition expands existing hybrid cloud and automation offerings, including AI infrastructure and the Red Hat ecosystem. It also deepens IBM’s commitment to open source technologies, following earlier major purchases of Red Hat and HashiCorp.
Enterprise AI and hybrid cloud
The deal points to a broader shift in enterprise technology: AI cannot work at scale without a modern data architecture capable of delivering continuous, real-time insights. Confluent’s streaming capabilities enable organizations to break down data silos – one of the most persistent challenges in deploying AI agents across business units.
By integrating Confluent directly into its portfolio, IBM aims to become an end-to-end pipeline provider that combines data management, analytics and AI into a single operational flow. This could reduce complexity for customers who currently rely on patchwork combinations of cloud services, data brokers and legacy storage.
The acquisition also signals how competitive the AI infrastructure market has become. Companies like Amazon, Google, Microsoft, Snowflake and Databricks are similarly building or acquiring technologies to manage high-speed data. IBM’s decision indicates that it does not see real-time data streaming as an additional tool, but as a basic requirement for future enterprise systems.
Financial expectations
IBM expects the transaction to be accretive to adjusted EBITDA in the first full year after closing and to be accretive to free cash flow in the second year. Confluent’s largest shareholders, who represent about 62 percent of the voting rights, have already agreed to vote in favor of the deal — a major step toward clearing the regulatory approval process.
The purchase will be funded by IBM’s available cash. Both companies’ boards of directors have approved the deal, and the transaction is expected to close by mid-2026, pending shareholder and regulatory review.
If completed, the acquisition will add more than 6,500 Confluent customers to IBM’s client base – including more than 40 percent of the Fortune 500. The companies also share partnerships across major technology ecosystems such as Anthropic, AWS, Google Cloud, Microsoft and Snowflake, in line with IBM’s stated strategy of maintaining an open, multi-cloud approach.
What comes next
Confluent’s portfolio includes fully managed cloud offerings, self-managed platforms, hybrid deployment models and private cloud services—capabilities that IBM will likely integrate into its own data structure and AI governance tools. Industry watchers will be watching as IBM balances Confluent’s open-source roots with its enterprise-level product strategy.
If the integration is successful, IBM could emerge with one of the most comprehensive data platforms tailored for large-scale AI adoption. The deal also underscores a growing awareness among businesses: it’s not just powerful models that unlock the value of AI, but also the quality, connectivity and timeliness of the data that delivers it.
According to Gartner, only 5% of automakers will continue to expand AI investments at current levels by 2029, a sharp decline from more than 95% today.