Kyndryl misses quarterly estimates on weak sales and charges linked to job cuts
KD•Workforce plan and outlook remain in focus
- The company had announced a workforce rebalancing plan last quarter aimed at cutting annual operating costs by $400 million to $500 million by fiscal 2028.
- Kyndryl reaffirmed its fiscal 2027 outlook for adjusted pretax income of $600 million to $700 million and free cash flow of $400 million to $500 million.
- Adjusted loss per share for the quarter was 12 cents, narrower than analysts' estimate of a 14-cent loss.
- Total signings rose to $3.9 billion in the quarter from $3.2 billion a year earlier.
- Kyndryl signed 10 customer contracts exceeding $50 million each during the quarter.
- The company has partnered with Amazon Web Services, Google Cloud and Microsoft Azure to help customers move and manage their IT systems in the cloud.
Quarterly results miss on weaker sales and workforce charges
Aug. 5 (Reuters) - IT services provider Kyndryl missed Wall Street estimates for the first quarter on Wednesday, as lower demand and charges tied to its workforce rebalancing plan weighed on results.
The company's shares were down 7.9% in morning trading.
- Revenue in Kyndryl's largest geographic segment, Principal Markets, fell 7% in the quarter to $1.26 billion.
- The company's first-quarter revenue of $3.62 billion missed analysts' average estimate of $3.64 billion, according to data compiled by LSEG.
- Its pretax loss for the quarter came in at $69 million, compared with estimates of a $61.5 million loss.
- The New York-based company was spun off from IBM in 2021 and provides IT infrastructure, cloud, AI and cybersecurity services to businesses.
