Companies /Technology

Kyndryl Holdings Inc

NYSE: KD Information Technology Services
$13.25
â–² $0.57 (+4.50%) today
Markets closed · 7:48am ET

Q1 2026 Earnings

Reported Aug 4, 2025, 4:47pm ET · SEC source
$0.37
Beat +1.79%
EPS · est. $0.36
$3.7B
Miss −1.47%
Revenue · est. $3.8B
+10.1%
Beating market
KD vs S&P since report
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
−14%−7%0+7%Aug 4Aug 5report 4:47pm ETearnings−0.7%−12.7%
−14%−7%0+7%Aug 4Aug 5earnings−0.7%−12.7%
KD −12.7%S&P 500 −0.7%
−14%−7%0+7%Aug 4Aug 5report 4:47pm ETearnings−1.1%−13.0%
−14%−7%0+7%Aug 4Aug 5earnings−1.1%−13.0%
KD −13.0%NASDAQ −1.1%
−14%−7%0+7%Aug 4Aug 12report 4:47pm ETearnings+1.7%−10.3%
−14%−7%0+7%Aug 4Aug 12earnings+1.7%−10.3%
KD −10.3%S&P 500 +1.7%
−14%−7%0+7%Aug 4Aug 12report 4:47pm ETearnings+2.7%−10.3%
−14%−7%0+7%Aug 4Aug 12earnings+2.7%−10.3%
KD −10.3%NASDAQ +2.7%
−21.14%
Day of report
+2.56%
Next session
+2.28%
One week
+13.20%
30 days

S&P 500 over the same 30 days: +3.07%.

Did KD Beat Earnings? Q1 2026 Results

Kyndryl delivered a mixed fiscal first quarter for 2026, posting an earnings beat alongside a modest revenue shortfall as the IT infrastructure giant's profitability transformation continued to outrun its top-line recovery. Adjusted EPS came in at $0.37, clearing the $0.36 consensus estimate by 1.79%, while revenue of $3.74 billion trailed the $3.80 billion consensus by 1.47%, landing essentially flat year-over-year at just +0.1% growth. The standout driver behind the earnings strength was hyperscaler-related revenue, which surged 86% year-over-year to $400 million, keeping the company on track toward its fiscal 2026 target of $1.80 billion; that momentum, combined with AI-enabled automation through the Kyndryl Bridge platform, helped push adjusted EBITDA up 16% to $647 million with margins expanding to 17.3%. The stock's sharp decline following the report reflected investor focus on the revenue miss, though management reaffirmed its full-year outlook, including adjusted pretax income of at least $725 million and free cash flow of approximately $550 million.

Key Takeaways
  • Hyperscaler-related revenue of $400 million, up 86% year-over-year
  • Kyndryl Consult revenues grew 30% year-over-year
  • Three-A initiatives (Alliances, Advanced Delivery, Accounts) driving earnings growth and margin expansion
  • Trailing twelve-month signings of $18.3 billion, up 43% year-over-year
  • Projected pretax margin on recent signings in the high-single-digit range
  • AI-enabled automation through Kyndryl Bridge platform

“Our first quarter reflected steady progress across key growth areas of our business, with contributions from Kyndryl Consult, hyperscaler-related activity, scope expansions and productivity gains. Our expertise in mission-critical technology and our unique operational capabilities, including Kyndryl Bridge, are helping customers innovate and creating new growth opportunities for Kyndryl.”

Kyndryl CEO, on the earnings call

Forward Guidance & Outlook

Kyndryl reaffirmed its fiscal 2026 outlook (April 2025 to March 2026): adjusted pretax income of at least $725 million (a year-over-year increase of at least $243 million), adjusted EBITDA margin of approximately 18% (up ~130 basis points year-over-year), free cash flow of approximately $550 million (reflecting cash taxes of approximately $175 million), and constant-currency revenue growth of 1%. The company is also progressing toward its hyperscaler revenue target of $1.8 billion in fiscal 2026.

KD YoY Financials

Q1 2026 vs Q1 2025 · SEC filings Q1 2025 Q1 2026
$0$2.0B$4.0B$3.7B$3.7BRevenue$148.0M$92.0MOperating Income$11.0M$56.0MNet Income$805.0M$796.0MGross Profit
$0$2.0B$4.0BRevenueOperating IncomeNet IncomeGross Profit

KD Revenue by Segment

Principal Markets$1.4B+3.0%
United States$911.0M−8.0%
Strategic Markets$898.0M+3.0%
Japan$578.0M+2.0%

KD Revenue by Geography

United States$911.0M−8.0%
Japan$578.0M+2.0%

Figures from SEC filings and company reports. Not investment advice.