Overview
- Kyndryl reported adjusted EPS of $0.38 versus $0.36 expected on revenue of $3.721 billion, down 1% year over year and 3.7% in constant currency, as shares closed down 4.6%.
- Hyperscaler cloud revenue rose 65% to $440 million and Kyndryl Consult grew 28%, with roughly 25% of recent signings tied to AI, 12‑month signings totaling $15.6 billion, and book‑to‑bill above 1 for five straight quarters.
- The company expanded its AI footprint with new technology hubs in the U.K., France, and Singapore and launched an AI Innovation Lab in India.
- Capital returns accelerated as Kyndryl repurchased 2.9 million shares for $89 million and authorized an additional $400 million buyback, ending the quarter with $1.33 billion in cash.
- Guidance calls for about 1% constant‑currency revenue growth to roughly $15.2 billion in FY2026 and an adjusted EBITDA margin near 18%, with management reaffirming multi‑year FY2028 targets including over $1 billion in free cash flow.