IBM shares tumbled 10% Monday afternoon after Anthropic unveiled Claude Code, an AI tool designed to automate COBOL code modernization. The announcement sent shockwaves through the technology consulting sector, with Accenture and Cognizant also declining sharply amid concerns about their legacy system modernization businesses.

Anthropic's new tool can map dependencies, document workflows, and identify risks across thousands of lines of COBOL code in minutes rather than months. COBOL remains critical infrastructure, handling an estimated 95% of ATM transactions in the United States and powering financial systems, airlines, and government operations. The shrinking pool of developers who understand the decades-old programming language has made modernization services a significant revenue stream for consulting firms.

Legacy code modernization has traditionally stalled because understanding existing systems cost more than rewriting them. Anthropic claims Claude Code changes this equation by automating code analysis and implementation tasks, potentially reducing modernization timelines from years to quarters. The company released a Code Modernization Playbook alongside the tool announcement on February 23, 2026, signaling a direct challenge to consulting firms' core business models.