Kyndryl (NYSE:KD) Announces Quarterly Earnings Results

Kyndryl (NYSE:KD) announced its quarterly earnings results on Wednesday. The company reported $0.18 earnings per share for the quarter, missing analysts’ consensus estimates of $0.43 by ($0.25), FiscalAI reports. Kyndryl had a return on equity of 25.91% and a net margin of 1.65%.The firm had revenue of $3.77 billion for the quarter, compared to the consensus estimate of $3.75 billion. During the same period in the prior year, the business earned $0.52 earnings per share. The company’s revenue for the quarter was down .8% compared to the same quarter last year.

Here are the key takeaways from Kyndryl’s conference call:

• Kyndryl reported fiscal 2026 adjusted pre-tax income of $581 million, adjusted EBITDA of $2.7 billion, and generated $406 million in free cash flow, and it guides fiscal 2027 adjusted pre-tax income of $600–700 million while targeting >$1.2 billion adjusted pre-tax income and >$1 billion free cash flow for fiscal 2028.
• Growth is being driven by higher‑value services — Kyndryl Consult delivered its third consecutive year of double‑digit revenue growth and hyperscaler‑related revenue rose ~59% to nearly $2 billion, with Consult signings exceeding revenue entering fiscal 2027.
• Revenue headwinds persist — fiscal 2026 revenue was flat at $15.1 billion (down 3% cc) and management expects fiscal 2027 revenue to be flat to down ~2% cc, citing elongated sales cycles (especially in the U.K./Europe) and a multi‑point adverse impact from customers procuring IBM innovation directly.
• Operational efficiency and AI adoption are material levers — Advanced Delivery and Kyndryl Bridge AI agents are driving faster incident resolution and root‑cause analysis, the Accounts/alliances work yielded ~$1 billion of savings/profit improvement, and planned workforce rebalancing will incur ~$200 million charges in FY27 to achieve ~$400–500 million annualized savings in FY28.

Kyndryl Stock Down 10.9%

Shares of KD traded down $1.60 during midday trading on Wednesday, hitting $13.11. The stock had a trading volume of 11,601,717 shares, compared to its average volume of 4,905,415. The firm has a market cap of $2.95 billion, a price-to-earnings ratio of 12.48 and a beta of 1.72. The company has a 50 day simple moving average of $13.02 and a two-hundred day simple moving average of $20.53. Kyndryl has a twelve month low of $10.10 and a twelve month high of $44.20. The company has a debt-to-equity ratio of 1.75, a current ratio of 0.86 and a quick ratio of 0.86.

Institutional Inflows and Outflows

Hedge funds have recently modified their holdings of the company. Cresset Asset Management LLC acquired a new stake in shares of Kyndryl in the second quarter valued at approximately $222,000. Punch & Associates Investment Management Inc. boosted its holdings in Kyndryl by 27.1% during the third quarter. Punch & Associates Investment Management Inc. now owns 6,770 shares of the company’s stock worth $203,000 after purchasing an additional 1,445 shares during the last quarter. Keel Point LLC acquired a new position in Kyndryl during the second quarter worth $200,000. Rakuten Securities Inc. grew its position in Kyndryl by 973.1% in the second quarter. Rakuten Securities Inc. now owns 3,627 shares of the company’s stock valued at $152,000 after purchasing an additional 3,289 shares in the last quarter. Finally, Atlas Capital Advisors Inc. bought a new position in Kyndryl in the fourth quarter valued at $134,000. 71.53% of the stock is currently owned by institutional investors.

Wall Street Analysts Forecast Growth

Several brokerages recently commented on KD. Wall Street Zen raised Kyndryl from a “hold” rating to a “buy” rating in a research note on Sunday, February 22nd. Weiss Ratings downgraded Kyndryl from a “hold (c-)” rating to a “sell (d+)” rating in a report on Wednesday, March 18th. Morgan Stanley dropped their price target on Kyndryl from $28.00 to $13.00 and set an “equal weight” rating on the stock in a research report on Tuesday, March 24th. BMO Capital Markets started coverage on Kyndryl in a research report on Monday, April 20th. They issued a “market perform” rating and a $15.00 price objective for the company. Finally, Susquehanna lowered their target price on Kyndryl from $35.00 to $16.00 and set a “positive” rating for the company in a research note on Friday, February 13th. One equities research analyst has rated the stock with a Buy rating, five have assigned a Hold rating and three have given a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has a consensus rating of “Reduce” and a consensus price target of $22.79.

Kyndryl Company Profile

Kyndryl (NYSE: KD) is a global managed infrastructure services provider formed in November 2021 through the spin-off of IBM’s Managed Infrastructure Services business. The company designs, builds, manages and modernizes critical information technology systems for enterprises worldwide. Kyndryl’s core offerings include cloud migration and management, network and edge computing solutions, digital workplace services and IT resiliency and security capabilities.

With a workforce of approximately 90,000 professionals and operations in more than 60 countries, Kyndryl serves clients across a broad range of industries, including financial services, telecommunications, healthcare, manufacturing and retail.