Kyndryl Q2 2027: Earnings Beat Ends a Two-Quarter Slide
As seen on the 24/7 Wall St. homepage on November 4, 2026.
Two straight quarters of missing expectations ended with a 10% beat, and quarterly signings jumped to $4.1 billion from $2.8 billion a year ago, including 11 contracts above $50 million each. Hyperscaler-related revenue grew 27.2%, total revenue slipped 1.9%, and management reaffirmed fiscal 2027 guidance.
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Kyndryl posted adjusted earnings per share of $0.42 for the second quarter of fiscal 2027, topping the consensus estimate and snapping two straight quarters of missing expectations.
Adjusted EBITDA margin widened to 19.1% from 17.2% a year earlier as the restructuring program began to pay off, with the related charges part of a broader push for annualized run-rate operating expense savings in fiscal 2028.
Revenue of $3.65 billion edged past estimates but still declined year-over-year, with currency a drag and United States growth offsetting contraction in Principal Markets and Strategic Markets.
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Hyperscaler-related revenue surged 27.2% and quarterly signings jumped to $4.1 billion from $2.8 billion a year ago. That signing momentum is a forward-looking indicator the market will weigh against still-declining headline revenue.
Management reaffirmed full fiscal 2027 guidance, with constant-currency revenue expected to be flat to down 2%. Free cash flow was negative $34 million in the quarter on higher capital expenditures, and newly issued debt carries coupons well above the 2.05% notes that were repaid.
Sources
Mentioned: KD