Hedge fund manager Stanley Druckenmiller has called IBM (IBM -1.5%) one of the "more high probability shorts" he's seen in years, and declares Amazon Web Services (AWS) is "killing" the IT giant.
He's also critical of Big Blue's slumping free cash flow, and its efforts to boost flagging growth via M&A.
AWS is expected to pull in less than $4B in revenue this year, but is growing at a rapid clip. In addition, analysts have argued every IT dollar eaten up by cloud services results in a greater amount of on-premise IT spend being lost.
IBM recently bought Web hosting/cloud infrastructure provider SoftLayer for a reported $2B in order to better take on Amazon, as well as rivals such as Microsoft, Google, VMware, and Rackspace.
Though off its October lows, IBM remains down 5% YTD in a year during which the Nasdaq is up over 30%. Shares were hit hard last month by a Q3 revenue miss.