Kyndryl Holdings reported first-quarter fiscal 2027 results for the quarter ended 30 June 2026 that fell short of Wall Street expectations on both profitability and revenue metrics. The enterprise technology services company posted an adjusted loss of $0.12 per share against analyst forecasts for break-even earnings. Revenue reached $3.6 billion, trailing the consensus estimate of $3.67 billion and representing a 3% decline from the prior-year quarter on both reported and constant-currency bases.
Adjusted EBITDA declined significantly to $512 million from $647 million in the comparable prior-year period. The quarterly results were affected by $152 million in workforce rebalancing charges, which impacted both reported and adjusted financial figures. Free cash flow deteriorated to negative $401 million compared with negative $222 million a year prior, driven primarily by working capital timing effects including elevated software-related payments and reduced customer billings and collections.
Despite the underperformance relative to consensus, Chief Executive Officer Martin Schroeter characterized market conditions positively, attributing strong demand signals from existing customers and noting particular momentum in the company’s consulting division and services directed at hyperscalers alongside elevated interest in AI-driven modernization offerings. During the quarter, the company executed share repurchases totaling $64 million for 5.0 million shares under its capital return program.
Management maintained its outlook for the full fiscal year, sustaining guidance for adjusted pretax income between $600 million and $700 million and free cash flow ranging from $400 million to $500 million. The company also preserved its forecast for constant-currency revenue, projecting a range from flat to a 2% decline for the full fiscal 2027 period. Stock price declined 0.9% in pre-market trading following the announcement.
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