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Mar 31, 2023
Kyndryl Q4 2023 Earnings Report
Kyndryl's financial performance was solid in Q4 2023, with the company leveraging alliances and driving efficiency through advanced delivery, positioning the business for margin expansion.
Key Takeaways
Kyndryl reported Q4 2023 revenues of $4.3 billion and a net loss of $737 million, while adjusted EBITDA stood at $476 million and adjusted pretax loss was $61 million. The company exceeded first-year targets for Alliances, Advanced Delivery and Accounts initiatives. They also provided outlook for fiscal year 2024, reflecting continuing progress on the ‘three-A initiatives’
Revenues for the quarter totaled $4.3 billion, reflecting a year-over-year decline of 4% but a 1% increase in constant currency.
The company reported a net loss of $737 million, or $(3.24) per diluted share, compared to a net loss of $229 million in the prior-year period.
Adjusted pretax loss was $61 million, compared to adjusted pretax loss of $51 million in the prior-year period.
Adjusted EBITDA was $476 million, compared to $536 million in the prior-year period, impacted by unfavorable currency movements and software cost increases.
Revenue by Geographic Location
Forward Guidance
Kyndryl is providing the following outlook for its fiscal year 2024, which runs from April 2023 to March 2024:
Positive Outlook
- Revenue related to cloud hyperscaler alliances of more than $300 million.
- Revenue growth of (6%) to (8%) in constant currency compared to revenue of $17.0 billion in fiscal 2023, with most of the decline due to accelerated actions by Kyndryl to reduce certain low-margin revenue streams.
- Based on recent exchange rates, the Company’s outlook implies fiscal 2024 revenue of $16.0 to $16.4 billion.
- Adjusted EBITDA margin of 12% to 13%, an increase of 40 to 140 basis points compared to 11.6% in fiscal 2023.
- Adjusted pretax margin of 0% to (1%), an increase of 30 to 130 basis points compared to (1.3%) in fiscal 2023.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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