DXC Technology (NYSE:DXC) Releases Quarterly Earnings Results, Misses Expectations By $0.02 EPS

DXC Technology (NYSE:DXC) announced its earnings results on Thursday. The company reported $0.40 earnings per share for the quarter, missing the consensus estimate of $0.42 by ($0.02), FiscalAI reports. The firm had revenue of $3 billion for the quarter, compared to the consensus estimate of $2.99 billion. DXC Technology had a net margin of 0.14% and a return on equity of 17.24%. The company’s quarterly revenue was down 5.0% compared to the same quarter last year. During the same period in the prior year, the business earned $0.68 EPS. DXC Technology updated its Q2 2027 guidance to 0.550-0.550 EPS.

Here are the key takeaways from DXC Technology’s conference call:

• Revenue declined 6.7% year over year to $3.0 billion in Q1, while adjusted EBIT margin fell 180 basis points to 5%. Management expects Q2 revenue to decline 5.5%-6.5% and fiscal 2027 organic revenue to decline 3%-5%.
• Bookings increased 5% overall, with GIS bookings up 35% and a 1.11 book-to-bill ratio, supported by several large new-logo and renewal wins. DXC said DXC OASIS was deployed across 57 customer environments and expects 125 customer deployments by fiscal year-end.
• The company’s expected second-half improvement depends heavily on GIS, with roughly 90% of the projected recovery coming from that segment. Management has substantial visibility from opening backlog but still requires modest in-year sales improvement and assumes no macroeconomic improvement.
• DXC reported early evidence that its agentic AI offerings are shortening customer sales cycles and improving operational results, including reducing intrusion-detection time in its own security operations from about 21 minutes to six seconds. It also cited a multi-year, multi-million-dollar Agentic SOC contract and 86 newly trained forward-deployed engineers.
• Free cash flow was $314 million, including a $214 million benefit from the TCS litigation settlement; excluding that benefit, free cash flow was $100 million, modestly above the prior year. Net debt declined by approximately $270 million quarter over quarter, and DXC plans to retire $400 million of bonds and repurchase about $250 million of shares during the fiscal year.

DXC Technology Stock Down 4.2%

Shares of DXC Technology stock traded down $0.49 during trading on Thursday, hitting $11.28. 5,443,477 shares of the stock traded hands, compared to its average volume of 3,781,650. The stock has a market cap of $1.84 billion, a P/E ratio of 3.62 and a beta of 0.82. The company has a debt-to-equity ratio of 0.94, a quick ratio of 1.36 and a current ratio of 1.36. DXC Technology has a twelve month low of $7.90 and a twelve month high of $15.68. The company has a fifty day moving average price of $9.36 and a two-hundred day moving average price of $11.47.

Analyst Ratings Changes

Several research firms have recently weighed in on DXC. Zacks Research upgraded shares of DXC Technology from a “strong sell” rating to a “hold” rating in a research report on Monday, July 13th. Stifel Nicolaus set a $12.00 target price on DXC Technology in a report on Friday, May 8th. Morgan Stanley lowered their price objective on shares of DXC Technology from $15.00 to $9.00 and set an “equal weight” rating on the stock in a research report on Thursday, May 14th. Weiss Ratings lowered shares of DXC Technology from a “sell (d+)” rating to a “sell (d)” rating in a research note on Monday, May 11th. Finally, Royal Bank Of Canada reiterated a “sector perform” rating and issued a $16.00 target price on shares of DXC Technology in a research report on Friday, June 12th. Seven analysts have rated the stock with a Hold rating and three have issued a Sell rating to the company. According to MarketBeat.com, DXC Technology has a consensus rating of “Reduce” and an average target price of $12.25.

Insider Activity at DXC Technology

In other news, CEO Raul J. Fernandez acquired 28,051 shares of the company’s stock in a transaction that occurred on Monday, May 11th. The shares were purchased at an average price of $8.90 per share, for a total transaction of $249,653.90. Following the completion of the acquisition, the chief executive officer owned 844,052 shares of the company’s stock, valued at approximately $7,512,062.80. This represents a 3.44% increase in their position. The purchase was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Insiders own 1.13% of the company’s stock.

Institutional Trading of DXC Technology

Large investors have recently added to or reduced their stakes in the business. EverSource Wealth Advisors LLC raised its holdings in shares of DXC Technology by 240.6% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 1,737 shares of the company’s stock valued at $27,000 after purchasing an additional 1,227 shares in the last quarter. CIBC Private Wealth Group LLC boosted its holdings in DXC Technology by 13,258.8% in the fourth quarter. CIBC Private Wealth Group LLC now owns 2,271 shares of the company’s stock worth $33,000 after purchasing an additional 2,254 shares in the last quarter. Headlands Technologies LLC bought a new stake in DXC Technology in the second quarter worth $39,000. Caitlin John LLC increased its position in DXC Technology by 358.0% during the fourth quarter. Caitlin John LLC now owns 3,224 shares of the company’s stock worth $49,000 after buying an additional 2,520 shares during the last quarter. Finally, Parallel Advisors LLC raised its holdings in DXC Technology by 36.9% during the third quarter. Parallel Advisors LLC now owns 8,513 shares of the company’s stock valued at $116,000 after buying an additional 2,295 shares in the last quarter. 96.20% of the stock is owned by institutional investors.

About DXC Technology

DXC Technology, headquartered in Tysons Corner, Virginia, is a global leader in IT services and solutions. The company was formed in 2017 through the merger of Computer Sciences Corporation (CSC) and the Enterprise Services business of Hewlett Packard Enterprise, combining decades of experience in consulting, systems integration and managed services. Since its inception, DXC has focused on helping clients modernize IT environments and drive digital transformation across their organizations.

DXC Technology’s core service offerings encompass cloud and platform services, applications and analytics, security, and workplace and mobility solutions.