Kyndryl, the world’s largest infrastructure services provider, began trading as an independent company under the symbol KD from the New York Stock Exchange, Thursday, November 4 in NYC. (Jon Simon/Feature Photo Service for Kyndryl)
IBM global infrastructure service provider spin-off, Kyndryl suffered terribly at the hands of Wall Street after it released some miserable results.
The company’s stock sank more than 12 per cent Wednesday, with shares closing at $12.53 and its market cap at $2.85 billion.
The company published guidance for fiscal 2024 revenue expected to fall six per cent to eight per cent compared to its fiscal 2023 revenue, with positive revenue growth not expected until fiscal 2025.
Kyndryl reported revenue of $4.26 billion, which beat analyst expectations by $110 million, but its GAAP loss per share of $3.24 was $2.21 per share below expectations.
Kyndryl share prices had fallen by nearly 13 per cent to $12.52 per share. This compared to this year’s peak of $17.08 per share on February 15, and its all-time peak of $40.75 per share on October 22, 2021, when the company was spun out of IBM.
Kyndryl has been laying offs employees, although the company said it was not many and would help the company become more efficient and competitive.
Kyndryl CEO Martin Schroeter said that Kyndryl has accomplished much in its first full fiscal year as an independent company.
“We delivered solid fourth-quarter results exceeding our recent guidance. We exceeded our year-one targets for our alliances, advanced delivery, and accounts.
“We’re solidifying our leadership position in mission-critical IT services. And we are signing new contracts that will drive margin expansion going forward. In short, we are taking full advantage of the new freedom associated with our independence and autonomy,” he said.
Kyndryl is pinning its hopes on future growth on its ‘Three-A’ initiative, which includes alliances, advanced delivery, and accounts.
For fiscal 2024, Kyndryl is expecting to see actual revenue related to its cloud hyperscaler alliances of over $300m, report cumulative benefits from advanced delivery of about $450m, and report incremental benefits from its accounts initiative of about $400m.
For its fourth fiscal quarter 2023, Kyndryl reported revenue of $4.26 billion, down nearly four per cent compared to the $4.43 billion the company reported for its fourth fiscal quarter 2022.
This included US revenue of $1.15 billion, down two per cent from last year; Japan revenue of $648m, down eight per cent; principal market revenue of $1.50 billion, down five per cent; and strategic market revenue of $966m, down one per cent.
On a GAAP basis, Kyndryl reported net loss of $737 million. It significantly improved over the net loss of $1.37 billion it reported last year..
For all of fiscal 2023, Kyndryl reported revenue of $17.03 billion, down seven per cent over the $18.32 billion the company reported for fiscal 2022.
