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Mar 31, 2024
Kyndryl Q4 2024 Earnings Report
Kyndryl reported mixed results with revenue decline but improved profitability in Q4 2024.
Key Takeaways
Kyndryl's Q4 2024 results showed a revenue of $3.8 billion, a net loss of $45 million, and an adjusted EBITDA of $566 million. The company is focusing on strategic initiatives and expects a return to revenue growth in Q4 2025.
Kyndryl's Q4 revenues totaled $3.8 billion, reflecting a year-over-year decline of 10%.
The company reported a net loss of $45 million, or ($0.20) per diluted share, compared to a net loss of $737 million in the prior-year period.
Adjusted EBITDA increased by 19% to $566 million, driven by the company’s three-A initiatives.
Kyndryl Consult revenues grew 13% year-over-year, demonstrating strong performance in the consulting segment.
Kyndryl
Kyndryl
Kyndryl Revenue by Geographic Location
Revenue by Geographic Location
United States Revenue
CapyFin.comJapan Revenue
CapyFin.comPrincipal Markets Revenue
CapyFin.comStrategic Markets Revenue
CapyFin.com Forward Guidance
Kyndryl expects revenue growth of (2%) to (4%) in constant currency compared to revenue of $16.1 billion in fiscal 2024, adjusted EBITDA margin of at least 16.2%, and adjusted pretax income of at least $435 million in fiscal 2025.
Positive Outlook
- The Company now expects to deliver year-over-year constant-currency revenue growth in the fourth quarter of the fiscal year.
- Adjusted EBITDA margin of at least 16.2%, an increase of at least 150 basis points compared to 14.7% in fiscal 2024, reflecting incremental benefits from the three-A initiatives.
- Adjusted pretax income of at least $435 million, an increase of at least $270 million compared to $165 million in fiscal 2024.
- Conversion of adjusted pretax income (less cash taxes) to adjusted free cash flow of roughly 100%.
Challenges Ahead
- Revenue growth of (2%) to (4%) in constant currency compared to revenue of $16.1 billion in fiscal 2024, which reflects actions by Kyndryl to reduce certain inherited zero-margin and low-margin revenue streams.
- Based on recent exchange rates, the Company’s outlook implies fiscal 2025 revenue of $15.2 to $15.5 billion.
Revenue & Expenses
Visualization of income flow from segment revenue to net income