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Mar 31
Kyndryl Q4 2025 Earnings Report
Kyndryl delivered solid Q4 2025 results with a return to constant-currency revenue growth and strong profitability improvements.
Key Takeaways
Kyndryl reported $3.8 billion in Q4 revenue with net income of $68 million and adjusted EBITDA of $698 million. The company saw a significant improvement in adjusted pretax income, strong cash flow, and continued execution of its strategic initiatives. Kyndryl also provided a positive outlook for fiscal 2026.
Q4 revenue was $3.8 billion, up 1.3% in constant currency; adjusted EBITDA rose 23% to $698 million.
Net income of $68 million compared to a loss in the prior-year period; adjusted net income was $126 million.
Free cash flow reached $335 million in Q4, while operating cash flow was $581 million.
Record FY 2025 signings of $18.2 billion, a 46% increase year-over-year.
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 continued revenue growth in constant currency and improved profitability in fiscal 2026, supported by execution of strategic initiatives and growing demand for digital transformation services.
Positive Outlook
- At least $725 million in adjusted pretax income projected for FY 2026.
- Adjusted free cash flow forecasted at approximately $550 million.
- Adjusted EBITDA margin expected to rise 130 basis points to ~18%.
- Strong margin profile on newly signed contracts.
- Growth momentum in Kyndryl Consult and cloud hyperscaler alliances.
Challenges Ahead
- FY 2026 guidance assumes only 1% constant-currency revenue growth.
- IBM software cost increases continue to pressure margins.
- Workforce rebalancing and lease-related charges remain a cost factor.
- Market volatility and macroeconomic risks could affect demand.
- No mention of dividend policy for FY 2026, despite share repurchases.