IBM and NASA launch open-source AI for climate analysis

YORKTOWN HEIGHTS, N.Y. - IBM (NYSE:IBM), in collaboration with NASA and Oak Ridge National Laboratory, has unveiled a new open-source artificial intelligence (AI) model designed to enhance weather and climate forecasting. The model, which is available to the scientific, developer, and business communities, aims to provide a more scalable and flexible approach to a variety of meteorological challenges.

The AI foundation model, as described in a recent arXiv paper, is capable of performing tasks beyond those of current weather AI models, such as producing targeted forecasts from local data, detecting severe weather patterns, refining global climate simulations, and enhancing the representation of physical processes in numerical models. Remarkably, the model demonstrated the ability to accurately reconstruct global surface temperatures using only a five percent sample of original data, indicating its potential for broader applications in data assimilation.

Pre-trained on four decades of Earth observation data from NASA's MERRA-2 project, the foundation model's architecture allows for fine-tuning at global to local scales, supporting a wide range of weather studies. Two specialized versions of the model have been released on Hugging Face: one for climate and weather data downscaling, which can generate up to 12x resolution data for localized forecasts, and another for gravity wave parameterization, aimed at improving the accuracy of numerical weather and climate models.

NASA's Earth Science Division Director, Karen St. Germain, emphasized the importance of delivering actionable science to address rapid planetary changes, noting the foundation model's role in producing useful tools for weather and climate projections.

Juan Bernabe-Moreno of IBM Research Europe highlighted the model's flexibility, which allows it to be adapted to various inputs and uses, potentially aiding in the understanding of meteorological phenomena and severe weather events.

The collaboration with Environment and Climate Change Canada (ECCC) has already begun to test the model's versatility in weather forecasting, including short-term precipitation forecasts and downscaling techniques.

This initiative is part of a broader partnership between IBM Research and NASA, which includes the Prithvi geospatial AI foundation model, the largest of its kind on Hugging Face, used by various organizations to study geophysical processes.

The new weather and climate foundation model, along with the gravity wave parameterization model, can be accessed via the NASA-IBM Hugging Face page, and the downscaling model is available on IBM's Granite Hugging Face page. This release is based on a press release statement from IBM.

In other recent news, IBM has made significant strides in its business operations and strategic initiatives. The company has expanded its hybrid cloud cost management capabilities with the acquisition of Kubecost, a specialist in Kubernetes cost monitoring and optimization. This move enhances IBM's investment in the FinOps field, aiming to maximize the business value of cloud investments.

In another development, IBM has announced plans to acquire Accelalpha, an Oracle (NYSE:ORCL) Cloud Applications service provider. This acquisition is expected to bolster IBM's Oracle consulting capabilities, particularly in supply chain, logistics, finance, enterprise performance management, and customer transformation.

Goldman Sachs has maintained its Conviction Buy rating on IBM, highlighting the company's solid demand in infrastructure software and potential gains from mergers and acquisitions. The company's management is optimistic about long-term revenue growth, expecting mid-to-high single-digit increases.

IBM also unveiled its upcoming IBM Telum II Processor and IBM Spyre Accelerator at the Hot Chips 2024 conference. These technologies aim to enhance the capacity of IBM Z mainframe systems for enterprise-scale AI.

In financial developments, IBM announced a regular quarterly cash dividend of $1.67 per common share, demonstrating its financial stability and commitment to shareholder returns.

Lastly, the company is experiencing workforce reductions, in line with trends across various sectors, but is also focusing on hiring for AI-centered roles. These are the recent developments in the company.

InvestingPro Insights

As IBM continues to innovate in the field of artificial intelligence for weather and climate forecasting, the company's financial metrics reflect a stable and robust business model. With a market capitalization of $200.53 billion, IBM stands as a significant player in the IT Services industry. The company's dedication to shareholder returns is evident through its impressive track record of maintaining dividend payments for 54 consecutive years, a testament to its financial health and commitment to investors.

An InvestingPro Tip worth noting is that IBM has raised its dividend for 28 consecutive years, highlighting its consistency in rewarding shareholders. Additionally, the company's stock generally trades with low price volatility, which may appeal to investors looking for stable equity investments in the technology sector.

InvestingPro Data provides further insights with IBM's price-to-earnings (P/E) ratio at 23.55, indicating how much investors are willing to pay for a dollar of earnings. The price/book ratio, as of the last twelve months leading up to Q2 2024, stands at 8.35, suggesting a premium valuation compared to the book value of the company. Furthermore, the company's revenue growth over the same period is 3.04%, showing a steady increase in its top-line financial performance.

For those interested in more in-depth analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/IBM, which provide valuable insights for both short-term traders and long-term investors considering IBM as part of their portfolio.

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