- Revenues for the quarter ended June
30, 2024 total $3.74 billion,
pretax income is $64 million, and net
income is $11 million
- Adjusted EBITDA is $556
million, adjusted pretax income is $92 million, and adjusted net income is
$31 million
- Kyndryl Consult continues to gain momentum with double-digit
revenue growth in the quarter and over the last twelve
months
- Raises adjusted earnings outlook for fiscal year 2025 and
reaffirms constant-currency revenue outlook with revenue growth in
the fourth quarter
NEW
YORK, July 31, 2024 /PRNewswire/ -- Kyndryl
Holdings, Inc. (NYSE: KD), the world's largest IT infrastructure
services provider, today released financial results for the
quarter ended June 30, 2024, the
first quarter of its 2025 fiscal year.
"Kyndryl continued its momentum and delivered another strong set
of results in the first quarter, led by significant increases in
Kyndryl Consult and hyperscaler-related revenues. Our
expertise in running and transforming mission-critical technology
differentiates us in the markets we serve. This uniquely
positions Kyndryl at the center of secular trends shaping the
evolution of IT," said Kyndryl Chairman and Chief Executive Officer
Martin Schroeter.
"Going forward, we'll continue to execute our strategy and drive
meaningful financial progress, and we remain on track to deliver
top-line growth in the fourth quarter of this fiscal
year."
Results for the Fiscal First Quarter Ended June 30, 2024
For the first quarter, Kyndryl reported revenues of $3.74 billion, a year-over-year decline of 11%
and 8% in constant currency. The year-over-year revenue
decline reflects the Company's progress in reducing inherited
no-margin and low-margin third-party content in customer contracts,
particularly in its United States
and Strategic Markets segments. The Company reported pretax
income of $64 million and net income
of $11 million, or $0.05 per diluted share, in the quarter, compared
to a net loss of $141 million, or
($0.62) per diluted share, in the
prior-year period. Cash flow used in operations was
$48 million in this seasonally weak
quarter for cash flow.
Adjusted pretax income was $92
million, a 96% increase compared to adjusted pretax income
of $47 million in the prior-year
period, reflecting growing contributions from Kyndryl's three-A
initiatives – Alliances, Advanced Delivery and Accounts.
First quarter results also included the contractually required
increase in IBM software costs, workforce rebalancing charges and
unfavorable currency movements year-over-year, fully offset by a
vendor credit (related to the Accounts initiative) and a reduction
in depreciation expense due to the previously announced extension
of the useful lives of the Company's hardware assets; these items
in aggregate offset each other.
In the quarter, adjusted EBITDA was $556
million, and adjusted free cash flow was ($116) million. Both figures reflect
workforce rebalancing actions implemented in the quarter.
"In the quarter, we continued to expand our adjusted pretax
income margins year-over-year, driven by strong execution on our
three-A initiatives and another quarter of double-digit growth in
Kyndryl Consult. And importantly, we've delivered growth in
total signings over the last twelve months with new contracts
having solid projected margins. This is positioning us for future
revenue, margin and profit growth," said Kyndryl Chief Financial
Officer David Wyshner.
Recent Developments
- Alliances initiative – In the first quarter, Kyndryl
recognized $210 million in revenue
tied to cloud hyperscaler alliances, progressing well toward the
Company's hyperscaler revenue target of nearly $1 billion in fiscal year 2025.
- Advanced Delivery initiative – The AI-enabled Kyndryl
Bridge operating platform is further enhancing the world-class
technology services the Company provides and creating additional
revenue opportunities. It has also helped Kyndryl free up more than
10,500 delivery professionals. This has generated annualized
savings of approximately $650 million
as of quarter-end, tracking toward the Company's $750 million fiscal 2025 year-end goal.
- Accounts initiative – Kyndryl continued to
address elements of contracts with substandard margins, bringing
the total impact from this initiative to $725 million of annualized benefits, on track to
achieve the Company's $850 million
fiscal 2025 year-end objective.
- Strong projected margin on recent signings – In
the quarter, projected pretax income margins associated with total
signings were in the high-single-digit range, which aligns with
levels achieved throughout fiscal 2023 and fiscal 2024 and reflects
the Company's focus on margin expansion.
- Double-digit growth in Kyndryl Consult – In the first
quarter, Kyndryl Consult revenues grew 10% year-over-year and 14%
in constant currency. Kyndryl Consult signings grew 49%
year-over-year in constant currency in the first quarter, and have
grown 31% year-over-year in constant currency over the last twelve
months.
- Other – In April, an appeals court overturned a judgment
against IBM in litigation brought by BMC Software for which IBM
might have sought indemnification from Kyndryl. All costs and
benefits, including any reserve reversals, related to this
litigation are included in the Company's reported results and
excluded from its adjusted results.
Raising Fiscal Year 2025 Outlook
Kyndryl is raising its adjusted earnings outlook for its fiscal
year 2025, which runs from April 2024
to March 2025:
- Adjusted EBITDA margin of at least 16.3% compared to its prior
outlook of at least 16.2%. This represents a year-over-year
increase of at least 160 basis points.
- Adjusted pretax income of at least $460
million compared to its prior outlook of at least
$435 million. This represents a
year-over-year increase of at least $295
million.
Kyndryl is reaffirming its outlook for constant-currency revenue
growth of (2%) to (4%), 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 again implies
fiscal 2025 revenue of $15.2 to
$15.5 billion. The Company
continues to expect to deliver year-over-year constant-currency
revenue growth in the fourth quarter of the fiscal year, and the
Company continues to expect to generate adjusted free cash flow of
approximately $300 million in fiscal
year 2025.
Forecasted amounts are based on currency exchange rates as of
July 2024.
Earnings Webcast
Kyndryl's earnings call for the first fiscal quarter is
scheduled to begin at 8:30 a.m. ET on
August 1, 2024. The live
webcast can be accessed by visiting investors.kyndryl.com on
Kyndryl's investor relations website. A slide presentation
will be made available on Kyndryl's investor relations website
before the call on August 1,
2024. Following the event, a replay will be available via
webcast for twelve months at investors.kyndryl.com.
About Kyndryl
Kyndryl (NYSE: KD) is the world's largest IT infrastructure
services provider, serving thousands of enterprise customers in
more than 60 countries. The Company designs, builds, manages
and modernizes the complex, mission-critical information systems
that the world depends on every day. For more information, visit
www.kyndryl.com.
Forward-Looking and Cautionary Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. All statements other than statements of historical fact
included in this press release, including statements concerning the
Company's plans, objectives, goals, beliefs, business strategies,
future events, business condition, results of operations, financial
position, business outlook and business trends and other
non-historical statements, including without limitation the
information presented in the "Outlook" section of this press
release (which does not assume any acquisitions or divestitures),
are forward-looking statements. Such forward-looking
statements often contain words such as "aim," "anticipate,"
"believe," "contemplate," "could," "estimate," "expect,"
"forecast," "intend," "may," "opportunity," "plan," "position,"
"predict," "project," "should," "seek," "target," "will," "would"
and other similar words or expressions or the negative thereof or
other variations thereon. Forward-looking statements are
based on the Company's current assumptions and beliefs regarding
future business and financial performance.
The Company's actual business, financial condition or results of
operations may differ materially from those suggested by
forward-looking statements as a result of risks and uncertainties
which include, among others: failure to attract new customers,
retain existing customers or sell additional services to customers;
failure to meet growth and productivity objectives; competition;
impacts of relationships with critical suppliers and partners;
failure to address and adapt to technological developments and
trends; inability to attract and retain key personnel and other
skilled employees; impact of economic, political, public health and
other conditions; damage to the Company's reputation; inability to
accurately estimate the cost of services and the timeline for
completion of contracts; service delivery issues; the Company's
ability to successfully manage acquisitions and dispositions,
including integration challenges, failure to achieve objectives,
the assumption of liabilities and higher debt levels; the impact of
our business with government customers; failure of the Company's
intellectual property rights to prevent competitive offerings and
the failure of the Company to obtain, retain and extend necessary
licenses; the impairment of our goodwill or long-lived assets;
risks relating to cybersecurity, data governance and privacy; risks
relating to non-compliance with legal and regulatory requirements;
adverse effects from tax matters and environmental matters; legal
proceedings and investigatory risks; the impact of changes in
market liquidity conditions and customer credit risk on
receivables; the Company's pension plans; the impact of currency
fluctuations; risks related to the Company's spin-off from IBM; and
risks related to the Company's common stock and the securities
market.
Additional risks and uncertainties include, among others, those
risks and uncertainties described in the "Risk Factors" section of
the Company's Annual Report on Form 10-K for the fiscal year ended
March 31, 2024, and may be further
updated from time to time in the Company's subsequent filings with
the Securities and Exchange Commission. Any forward-looking
statement in this press release speaks only as of the date on which
it is made. Except as required by law, the Company assumes no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or
otherwise.
In this release, certain amounts may not add due to the use of
rounded numbers; percentages presented are calculated based on the
underlying amounts.
Non-GAAP Financial Measures
In an effort to provide investors with additional information
regarding its results, the Company has provided certain metrics
that are not calculated based on generally accepted accounting
principles (GAAP), such as constant-currency results, adjusted
EBITDA, adjusted pretax income, adjusted net income, adjusted EPS,
adjusted EBITDA margin, adjusted pretax margin, adjusted net margin
and adjusted free cash flow. Such non-GAAP metrics are
intended to supplement GAAP metrics, but not to replace them.
The Company's non-GAAP metrics may not be comparable to similarly
titled metrics used by other companies. Definitions of
non-GAAP metrics and reconciliations of non-GAAP metrics for
historical periods to GAAP metrics are included in the tables in
this release.
A reconciliation of forward-looking non-GAAP financial
information is not included in this release because the Company is
unable to predict with reasonable certainty some individual
components of such reconciliation without unreasonable
effort. These items are uncertain, depend on various factors
and could have a material impact on future results computed in
accordance with GAAP.
Investor Contact:
Lori Chaitman
lori.chaitman@kyndryl.com
Media Contact:
Ed Barbini
edward.barbini@kyndryl.com
Table
1
KYNDRYL HOLDINGS,
INC.
CONSOLIDATED INCOME
STATEMENT
(in millions, except
per share amounts)
|
|
|
|
Three Months Ended June 30,
|
|
|
2024
|
|
2023
|
Revenues
|
|
$
|
3,739
|
|
$
|
4,193
|
|
|
|
|
|
|
|
Cost of
services
|
|
$
|
2,934
|
|
$
|
3,449
|
Selling, general and
administrative expenses
|
|
|
657
|
|
|
720
|
Workforce rebalancing
charges
|
|
|
36
|
|
|
58
|
Transaction-related
costs
|
|
|
20
|
|
|
42
|
Interest
expense
|
|
|
28
|
|
|
29
|
Other
expense
|
|
|
—
|
|
|
5
|
Total costs and expenses
|
|
$
|
3,675
|
|
$
|
4,302
|
|
|
|
|
|
|
|
Income (loss) before income
taxes
|
|
$
|
64
|
|
$
|
(109)
|
Provision for income taxes
|
|
|
53
|
|
|
32
|
Net income (loss)
|
|
$
|
11
|
|
$
|
(141)
|
|
|
|
|
|
|
|
Earnings per share data
|
|
|
|
|
|
|
Basic earnings (loss)
per share
|
|
$
|
0.05
|
|
$
|
(0.62)
|
Diluted earnings (loss)
per share
|
|
|
0.05
|
|
|
(0.62)
|
|
|
|
|
|
|
|
Weighted-average basic
shares outstanding
|
|
|
230.5
|
|
|
227.9
|
Weighted-average
diluted shares outstanding
|
|
|
235.8
|
|
|
227.9
|
Table
2
SEGMENT
RESULTS
AND SELECTED BALANCE
SHEET INFORMATION
(dollars in
millions)
|
|
|
|
Three Months Ended June 30,
|
|
Year-over-Year Growth
|
|
|
|
|
|
|
|
|
As
|
|
Constant
|
Segment Results
|
|
2024
|
|
2023
|
|
Reported
|
|
Currency
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
$
|
986
|
|
$
|
1,164
|
|
(15 %)
|
|
(15 %)
|
Japan
|
|
|
569
|
|
|
610
|
|
(7 %)
|
|
6 %
|
Principal
Markets1
|
|
|
1,315
|
|
|
1,391
|
|
(5 %)
|
|
(5 %)
|
Strategic
Markets1
|
|
|
869
|
|
|
1,027
|
|
(15 %)
|
|
(14 %)
|
Total
revenue
|
|
$
|
3,739
|
|
$
|
4,193
|
|
(11 %)
|
|
(8 %)
|
Adjusted EBITDA2
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
$
|
133
|
|
$
|
236
|
|
|
|
|
Japan
|
|
|
83
|
|
|
100
|
|
|
|
|
Principal
Markets
|
|
|
241
|
|
|
151
|
|
|
|
|
Strategic
Markets
|
|
|
120
|
|
|
149
|
|
|
|
|
Corporate and
other3
|
|
|
(21)
|
|
|
(24)
|
|
|
|
|
Total adjusted
EBITDA
|
|
$
|
556
|
|
$
|
612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
March 31,
|
|
|
|
|
Balance Sheet Data
|
|
2024
|
|
2024
|
|
|
|
|
Cash and
equivalents
|
|
$
|
1,269
|
|
$
|
1,553
|
|
|
|
|
Debt (short-term and
long-term)
|
|
|
3,239
|
|
|
3,238
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Principal Markets is
comprised of Kyndryl's operations in Canada, France, Germany,
India, Italy, Spain/Portugal and the United Kingdom/Ireland.
Strategic Markets is comprised of Kyndryl's operations in all other
geographic locations. Kyndryl's operations in Australia/New
Zealand transitioned from Principal Markets to Strategic Markets in
the quarter ended June 30, 2024; historical segment information has
been updated to reflect this change.
|
2
|
2024 amounts include
workforce rebalancing charges of $15 million in United States, $1
million in Japan, $5 million in Principal Markets, and $15 million
in Strategic Markets.
|
3
|
Represents net amounts
not allocated to segments.
|
Table
3
KYNDRYL HOLDINGS,
INC.
CONSOLIDATED
STATEMENT OF CASH FLOWS
(dollars in
millions)
|
|
|
|
Three Months Ended June 30,
|
|
|
2024
|
|
2023
|
Cash flows from operating
activities:
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
11
|
|
$
|
(141)
|
Adjustments to
reconcile net income (loss) to cash provided by operating
activities:
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
Depreciation of
property, equipment and capitalized software
|
|
|
127
|
|
|
210
|
Depreciation of
right-of-use assets
|
|
|
70
|
|
|
91
|
Amortization of
transition costs and prepaid software
|
|
|
310
|
|
|
325
|
Amortization of
capitalized contract costs
|
|
|
107
|
|
|
138
|
Amortization of
acquisition-related intangible assets
|
|
|
7
|
|
|
8
|
Stock-based
compensation
|
|
|
24
|
|
|
22
|
Deferred
taxes
|
|
|
17
|
|
|
26
|
Net (gain) loss on
asset sales and other
|
|
|
27
|
|
|
29
|
Change in operating
assets and liabilities:
|
|
|
|
|
|
|
Deferred costs
(excluding amortization)
|
|
|
(363)
|
|
|
(418)
|
Right-of-use assets
and liabilities (excluding depreciation)
|
|
|
(65)
|
|
|
(103)
|
Workforce rebalancing
liabilities
|
|
|
7
|
|
|
(23)
|
Receivables
|
|
|
163
|
|
|
53
|
Accounts
payable
|
|
|
(122)
|
|
|
(143)
|
Taxes
|
|
|
(9)
|
|
|
(25)
|
Other assets and other
liabilities
|
|
|
(358)
|
|
|
(222)
|
Net cash provided by (used in) operating
activities
|
|
$
|
(48)
|
|
$
|
(173)
|
|
|
|
|
|
|
|
Cash flows from investing
activities:
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
|
(122)
|
|
$
|
(100)
|
Proceeds from
disposition of property and equipment
|
|
|
24
|
|
|
6
|
Acquisitions and
divestitures, net of cash acquired
|
|
|
(46)
|
|
|
—
|
Other investing
activities, net
|
|
|
(22)
|
|
|
(19)
|
Net cash used in investing
activities
|
|
$
|
(166)
|
|
$
|
(113)
|
|
|
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
|
|
|
Debt
repayments
|
|
$
|
(38)
|
|
$
|
(30)
|
Common stock
repurchases for tax withholdings
|
|
|
(7)
|
|
|
(7)
|
Other financing
activities, net
|
|
|
(6)
|
|
|
(1)
|
Net cash provided by (used in) financing
activities
|
|
$
|
(51)
|
|
$
|
(38)
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
|
$
|
(17)
|
|
$
|
(15)
|
Net change in cash,
cash equivalents and restricted cash
|
|
$
|
(281)
|
|
$
|
(339)
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash at beginning of period
|
|
$
|
1,554
|
|
$
|
1,860
|
Cash, cash equivalents and restricted cash at end of
period
|
|
$
|
1,273
|
|
$
|
1,521
|
|
|
|
|
|
|
|
Supplemental data
|
|
|
|
|
|
|
Income taxes paid, net
of refunds received
|
|
$
|
54
|
|
$
|
65
|
Interest paid on
debt
|
|
$
|
40
|
|
$
|
46
|
Table 4
NON-GAAP METRIC DEFINITIONS AND
RECONCILIATIONS
(dollars in millions, except
signings)
We report our financial results in accordance with GAAP.
We also present certain non-GAAP financial measures to provide
useful supplemental information to investors. We provide
these non-GAAP financial measures as we believe it enhances
investors' visibility to management decisions and their impacts on
operational performance; enables better comparison to peer
companies; and allows us to provide a long-term strategic view of
the business going forward.
Constant-currency information compares results between
periods as if exchange rates had remained constant period over
period. We define constant-currency revenues as total
revenues excluding the impact of foreign exchange rate movements
and use it to determine the constant-currency revenue growth on a
year-over-year basis. Constant-currency revenues are
calculated by translating current period revenues using
corresponding prior-period exchange rates.
Adjusted pretax income (loss) is defined as pretax income
(loss) excluding transaction-related costs and benefits, charges
related to ceasing to use leased / fixed assets, charges related to
lease terminations, pension costs other than pension servicing
costs and multi-employer plan costs, stock-based compensation
expense, amortization of acquisition-related intangible assets,
workforce rebalancing charges incurred prior to March 31, 2024, impairment expense, significant
litigation costs and benefits, and currency impacts of highly
inflationary countries. The Company's fiscal year 2025
outlook for adjusted pretax income includes approximately
$100 million of anticipated workforce
rebalancing charges. Adjusted pretax margin is calculated by
dividing adjusted pretax income by revenue.
Adjusted EBITDA is defined as net income (loss) excluding
net interest expense, income taxes, depreciation and amortization
(excluding depreciation of right-of-use assets and amortization of
capitalized contract costs), charges related to ceasing to use
leased / fixed assets, charges related to lease terminations,
transaction-related costs and benefits, pension costs other than
pension servicing costs and multi-employer plan costs, stock-based
compensation expense, workforce rebalancing charges incurred prior
to March 31, 2024, impairment
expense, significant litigation costs and benefits, and currency
impacts of highly inflationary countries. The Company's
fiscal year 2025 outlook for adjusted EBITDA includes approximately
$100 million of anticipated workforce
rebalancing charges. Adjusted EBITDA margin is calculated by
dividing adjusted EBITDA by revenue.
Adjusted net income is defined as adjusted pretax income
less the reported provision for income taxes, minus or plus the tax
effect of the non-GAAP adjustments made to calculate adjusted
pretax income, and excluding exceptional items impacting the
reported provision for income taxes. Adjusted net margin is
calculated by dividing adjusted net income by revenue.
Adjusted earnings per share (EPS) is defined as adjusted
net income divided by diluted weighted average shares outstanding
to reflect shares that are dilutive or anti-dilutive based on the
amount of adjusted net income. The weighted average
common shares outstanding used to calculate adjusted earnings
(loss) per share will differ from such shares used to calculate
diluted earnings (loss) per share (GAAP) when the inclusion of
dilutive shares has an anti-dilutive effect for one calculation but
not for the other.
Adjusted free cash flow is defined as cash flows from
operating activities (GAAP) after adding back transaction-related
payments, charges related to lease terminations, payments related
to workforce rebalancing charges incurred prior to March 31, 2024, and significant litigation
payments, less net capital expenditures. Management uses
adjusted free cash flow as a measure to evaluate its operating
results, plan strategic investments and assess our ability and need
to incur and service debt. We believe adjusted free cash flow
is a useful supplemental financial measure to aid investors in
assessing our ability to pursue business opportunities and
investments and to service our debt. Adjusted free cash flow
is a financial measure that is not recognized under U.S. GAAP and
should not be considered as an alternative to cash flows from
operations or liquidity derived in accordance with U.S. GAAP.
Signings are defined by Kyndryl as an initial estimate of
the value of a customer's commitment under a contract. The
calculation involves estimates and judgments to gauge the extent of
a customer's commitment. We calculate this based on various
considerations including the type and duration of the agreement as
well as the presence of termination charges or wind-down
costs. Contract extensions and increases in scope are treated
as signings only to the extent of the incremental new value.
Signings can vary over time due to a variety of factors including,
but not limited to, the timing of signing a small number of larger
outsourcing contracts, as well as the length of those
contracts. The conversion of signings into revenue may vary
based on the types of services and solutions, customer decisions
and other factors, which may include, but are not limited to,
macroeconomic environment or external events. Management uses
signings as a tool to monitor the performance of the business
including the business' ability to attract new customers and sell
additional scope into our existing customer base.
|
|
|
|
|
|
|
Reconciliation of net income (loss)
to
|
|
|
|
|
|
|
adjusted pretax income (loss), adjusted
EBITDA,
|
|
|
adjusted net income (loss) and adjusted
EPS
|
|
Three Months Ended June 30,
|
(in millions, except per share
amounts)
|
|
2024
|
|
2023
|
Net income (loss)
(GAAP)
|
|
$
|
11
|
|
$
|
(141)
|
Provision for income
taxes
|
|
|
53
|
|
|
32
|
Pretax income (loss)
(GAAP)1
|
|
$
|
64
|
|
$
|
(109)
|
Workforce rebalancing
charges incurred prior to March 31, 2024
|
|
|
—
|
|
|
58
|
Charges related to
ceasing to use leased/fixed assets and lease
terminations
|
|
|
9
|
|
|
10
|
Transaction-related
costs
|
|
|
20
|
|
|
42
|
Stock-based
compensation expense
|
|
|
24
|
|
|
22
|
Amortization of
acquisition-related intangible assets
|
|
|
7
|
|
|
8
|
Other
adjustments2
|
|
|
(32)
|
|
|
16
|
Adjusted pretax income
(non-GAAP)
|
|
$
|
92
|
|
$
|
47
|
Interest
expense
|
|
|
28
|
|
|
29
|
Depreciation of
property, equipment and capitalized software
|
|
|
127
|
|
|
210
|
Amortization of
transition costs and prepaid software
|
|
|
310
|
|
|
325
|
Adjusted EBITDA
(non-GAAP)
|
|
$
|
556
|
|
$
|
612
|
Net income (loss) margin
|
|
|
0.3 %
|
|
|
(3.4 %)
|
Adjusted EBITDA margin
|
|
|
14.9 %
|
|
|
14.6 %
|
|
|
|
|
|
|
|
Adjusted pretax income
(non-GAAP)
|
|
$
|
92
|
|
$
|
47
|
Provision for income
taxes (GAAP)
|
|
|
(53)
|
|
|
(32)
|
Tax effect of non-GAAP
adjustments
|
|
|
(8)
|
|
|
(15)
|
Adjusted net income
(non-GAAP)
|
|
$
|
31
|
|
$
|
0
|
Diluted weighted
average shares outstanding
|
|
|
235.8
|
|
|
227.9
|
|
|
|
|
|
|
|
Diluted earnings (loss)
per share (GAAP)
|
|
$
|
0.05
|
|
$
|
(0.62)
|
Adjusted earnings per
share (non-GAAP)
|
|
$
|
0.13
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
1
|
Includes lower
depreciation expenses resulting from the change of useful life of
information technology equipment effective April 1, 2024 (a net
year-over-year benefit of $60 million)
|
2
|
Other adjustments
represent pension costs other than pension servicing costs and
multi-employer plan costs, significant litigation costs and
benefits, and currency impacts of highly inflationary
countries.
|
|
|
|
|
|
|
|
Reconciliation of cash flow from
operations
|
|
Three Months Ended June 30,
|
to adjusted free cash flow (in
millions)
|
|
2024
|
|
2023
|
Cash flows from
operating activities (GAAP)
|
|
$
|
(48)
|
|
$
|
(173)
|
Plus:
Transaction-related payments (benefits)
|
|
|
5
|
|
|
42
|
Plus: Workforce
rebalancing payments related to charges incurred prior to March 31,
2024
|
|
|
21
|
|
|
79
|
Plus: Significant
litigation payments
|
|
|
4
|
|
|
33
|
Plus: Payments related
to lease terminations
|
|
|
—
|
|
|
7
|
Less: Net capital
expenditures
|
|
|
(98)
|
|
|
(94)
|
Adjusted free cash flow
(non-GAAP)
|
|
$
|
(116)
|
|
$
|
(106)
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
Signings (in billions)
|
|
2024
|
|
2023
|
Signings1
|
|
$
|
3.1
|
|
$
|
2.8
|
|
|
|
|
|
|
|
|
1
|
Signings for the
quarter ended June 30, 2024 increased by 11%, and 14% in constant
currency, compared to the quarter ended June 30,
2023.
|
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SOURCE Kyndryl