Kyndryl Reaffirms Fiscal 2027 Outlook as Hyperscaler Revenue Grows 27.2%; Revenue Dips 1.9%
Kyndryl reaffirmed its fiscal 2027 outlook as hyperscaler-related revenue grew 27.2% in its fiscal second quarter, even though total revenue slipped 1.9% to $3.7 billion, according to its 8-K released Wednesday.
Revenue fell 0.8% in constant currency. Net income declined to $59 million, or $0.27 per diluted share, from $68 million, or $0.29, a year earlier. Results included $38 million of workforce rebalancing charges, up from $19 million.
On an adjusted basis, net income rose to $92 million, or $0.42 per share, from $89 million, or $0.38. Adjusted EBITDA increased to $699 million from $641 million, and adjusted pretax income rose to $150 million from $123 million.
Signings and growth businesses
Kyndryl reported $4.1 billion of signings in the quarter and $15.5 billion over the trailing 12 months, including 43 contracts worth more than $50 million each, 11 of them in the latest quarter.
Kyndryl Consult revenue grew 4.2% in the quarter, and consult signings rose 19.1% over the past 12 months to $4.6 billion. Hyperscaler-related revenue topped $550 million in the quarter and reached $2.1 billion over 12 months, up 38.5%.
"Strong signings and continued growth in Kyndryl Consult and hyperscaler-related revenue reinforce our confidence in our fiscal 2027 outlook," said Chairman and CEO Martin Schroeter.
Cash flow dips
Cash from operations increased to $172 million from $147 million, but free cash flow was a use of $34 million, compared with a $22 million inflow a year earlier.
Outlook reaffirmed
For fiscal 2027, which runs from April 2026 through March 2027, Kyndryl still expects adjusted pretax income of $600 million to $700 million, free cash flow of $400 million to $500 million and constant-currency revenue ranging from flat to down 2%.
By the numbers
- Fiscal Q2 revenue: $3.7 billion, down 1.9%
- Diluted EPS: $0.27; adjusted EPS: $0.42
- Adjusted EBITDA: $699 million
- Quarterly signings: $4.1 billion
- Hyperscaler-related revenue growth: 27.2%
Sources
- Kyndryl Holdings Form 8-K with fiscal second-quarter 2027 earnings release, filed Nov. 4, 2026 (accession 0001104659-26-122363)
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