Overview
Kyndryl fiscal Q2 revenue declines 1% yr/yr, missing analyst expectations
Adjusted EBITDA for fiscal Q2 beats analyst expectations
Company announces additional $400 mln share repurchase authorization
Outlook
Kyndryl reaffirms fiscal 2026 outlook with adjusted pretax income of at least $725 mln
Company expects adjusted EBITDA margin of approximately 18% for fiscal 2026
Kyndryl anticipates free cash flow of approximately $550 mln for fiscal 2026
Result Drivers
HYPERSCALER ALLIANCES - Revenue from cloud hyperscaler alliances grew 65% yr/yr, exceeding initial targets
KYDRYL CONSULT GROWTH - Kyndryl Consult revenues grew 28% yr/yr, driven by strategic initiatives
AI AND AUTOMATION - AI-enabled automation through Kyndryl Bridge platform contributed to earnings growth
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue | Miss | $3.72 bln | $3.84 bln (3 Analysts) |
Q2 EPS | $0.29 | ||
Q2 Net Income | $68 mln | ||
Q2 Adjusted EBITDA | Beat | $641 mln | $618.33 mln (3 Analysts) |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the it services & consulting peer group is "buy"
Wall Street's median 12-month price target for Kyndryl Holdings Inc is $39.12, about 26.5% above its November 3 closing price of $28.75
The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 16 three months ago
Press Release: ID:nPn5pSdWza
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)