NYSE$KD

Kyndryl Holdings Inc · Q1 2022 earnings

Q1 2022 earnings · · Investor relations

Briefing

Kyndryl's first full quarter as an independent company, expanded technology ecosystem, invested in people, and delivered progress on Alliances, Advanced Delivery and Accounts initiatives.

Kyndryl reported revenues of $4.4 billion for the quarter ended March 31, 2022, a year-over-year decline of 7%. The company reported a net loss of $229 million, or $1.02 per diluted share. Signings totaled $3.1 billion, an increase of 27% in constant currency.

  • Revenues for the quarter ended March 31, 2022 total $4.4 billion.
  • Net loss is $229 million, pretax loss is $189 million, and adjusted pretax loss is $51 million.
  • Delivers early progress on its Alliances, Advanced Delivery and Accounts initiatives.
  • Issues outlook for the fiscal year beginning April 2022.

Headline financials

Total Revenue

$4.43B

Previous: $4.77B-7.1%
EPS (adj)

-$1.02

Previous: -$2.20+53.6%
Capital Expenditures

$180M

Previous: $180M+0.0%
Free Cash Flow

$136M

Previous: -$508M+126.8%
Net Income

-$229M

Previous: -$494M+53.6%
Operating Income

-$189M

No prior period
Gross Profit

$607M

Previous: $453M+34.0%
Cash & Equivalents

$2.13B

Previous: $50M+4168.0%
Total Assets

$13.4B

No prior period
Stock-Based Comp

$31M

Previous: $16M+93.8%

Revenue & EPS history

Kyndryl · Revenue · Quarterly

$4.43B

Q1 2022-7.1%vs Q1 2021
Beat estimate in 10 of 13 quarters(77%)
ActualEstimate

Forward guidance

Kyndryl is providing the following outlook for its fiscal year beginning April 1, 2022 and ending March 31, 2023:

Tailwinds

  • Double-digit constant-currency signings growth compared to pro forma signings in calendar year 2021
  • Revenue of $16.5 to $16.7 billion, which includes an approximately $1.0 billion or six-percentage-point negative currency impact. This represents a decline of (4)% to (3)% in constant currency compared to pro forma revenue for the twelve months ended March 31, 2022
  • Adjusted EBITDA margin of 13% to 14%, reflecting currency headwinds and spin-off-related impacts on amortization, as discussed below
  • Adjusted pretax margin of 0% to 1%, consistent with calendar year 2021 pro forma results

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2022

Historical avgQ1 2022

+0.8%

Avg return

Earnings day

+1.5%

Avg return

5 days after

+4.7%

Avg return

30 days after

55%

12 / 22 earnings

Positive

+27.1%

Q4 2024

Best reaction

-54.9%

Q3 2026

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2026-3.8%-12.5%-11.5%
Q3 2026-54.9%-47.9%-46.1%
Q2 2026-4.7%-5.0%-4.5%
Q4 2025+10.5%+24.2%+21.8%
Q3 2025+5.2%+10.1%-6.6%
Q2 2025+19.8%+22.1%+50.1%
Q1 2025-12.2%-14.4%-11.4%
Q4 2024+27.1%+30.5%+26.9%
Q3 2024+1.6%+7.8%+5.9%
Q2 2024+15.1%+15.1%+19.3%
Q1 2024+16.0%+27.0%+32.1%
Q4 2023-13.6%-19.6%-8.4%
Q3 2023+24.8%+23.5%+14.9%
Q1 2021+7.0%+6.2%+38.8%
Q2 2023-15.1%-9.1%+17.9%
Q2 2021-0.6%-1.4%-8.7%
Q1 2023+4.5%+12.4%+4.6%
Q4 2019+1.4%-0.9%-18.6%
Q1 2022+15.2%+12.1%+0.5%
Q4 2021-14.7%-24.9%-16.9%
Q4 2020-5.5%-10.9%+1.7%
Q3 2021-5.5%-10.9%+1.7%

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