Kyndryl Q3 revenue just shy of market expectations; names interim CFO

Kyndryl Holdings

09/02/2026 12:15

Overview

Enterprise tech services firm's Q3 revenue slightly missed analyst expectations

Company's adjusted EBITDA for Q3 slightly missed analyst estimates

Kyndryl Consult segment achieved double-digit revenue growth in Q3

Company also names Harsh Chugh as interim CFO

Outlook

Kyndryl expects fiscal year 2026 constant-currency revenue decline of 2% to 3%

Company estimates 2026 adjusted pretax income of $575 to $600 mln

Company projects fiscal year 2026 adjusted EBITDA margin of approximately 17.5%

Kyndryl forecasts fiscal year 2026 free cash flow of $325 to $375 mln

Result Drivers

CONSULT SEGMENT GROWTH - Kyndryl Consult revenues grew 24% year-over-year, contributing significantly to overall revenue growth

HYPERSCALER REVENUE - Revenue from cloud hyperscaler alliances increased 58% year-over-year, contributing $500 million

THREE-A INITIATIVES - Initiatives in alliances, advanced delivery, and accounts drove earnings growth and margin expansion

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Slight Miss*
$3.86 bln
$3.89 bln (5 Analysts)
Q3 Adjusted EPS
$0.52
Q3 EPS
$0.25
Q3 Net Income
$57 mln
Q3 Adjusted EBITDA
Slight Miss*
$696 mln
$701.20 mln (5 Analysts)

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the it services & consulting peer group is "buy"

Wall Street's median 12-month price target for Kyndryl Holdings Inc is $38.23, about 62.8% above its February 6 closing price of $23.49

The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 10 three months ago

Press Release: ID:nPn46XJvla

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)