Kyndryl (KD) presented its outlook at Citi’s Global TMT Conference on Sept. 8, 2026. The company reported that first‑quarter FY27 revenue declined 3% year‑over‑year and reaffirmed its full‑year FY27 revenue guidance of flat to down 2%, which already incorporates a 3‑point headwind from reduced IBM content.
For FY28 the firm projects low single‑digit revenue growth, driven by continued expansion of its hyperscaler partnerships. Hyperscaler revenue has risen from zero at the time of the 2021 spin‑off to roughly $2 billion last year, with quarterly growth rates near 30%. Kyndryl now holds about 30,000 credentials across AWS, Google Cloud and Microsoft Azure and has deployed roughly 1,600 AI agents in infrastructure operations.
Adjusted operating profitability has turned positive, moving from a roughly $500 million loss at spin‑off to a guidance of more than $600 million for the current fiscal year. Debt stands at about $700 million, with leverage described as very low at the start of FY27 and a forthcoming maturity to be refinanced or paid down in cash. Free cash flow is expected to be negative in the first half of FY27, turning strongly positive in the second half.
Since launching its share‑repurchase authorization, Kyndryl has bought back about 8% of its outstanding shares. The stock trades around $12.71, versus a Fair‑Value estimate of $17.92, reflecting a 60% decline over the past year.
IBM‑related hardware and software content has fallen from roughly $4 billion annually at spin‑off to just under $2 billion last year, creating a 3‑point revenue drag that is expected to repeat in FY27. Meanwhile, the Kyndryl Bridge platform generates 15‑16 million actionable ideas each month, and the company’s book‑to‑bill ratio has stayed above 1.0 since the spin‑off.
Kyndryl highlighted its extensive enterprise footprint, operating systems for five of the seven largest airlines, 50 leading insurers, most major global banks, and more than half of the world’s outsourced mainframes. A recent partnership with Banque Internationale à Luxembourg was noted as the first European agentic bank to work with Kyndryl.
CEO Martin Schroeter emphasized the role of AI, stating that an AI agent can accomplish in one hour what 20 people could have done five years ago, and likened today’s technology pace to a bullet‑train on tracks built for slower speeds.
