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DXC Technology(DXC) - 2025 Q3 - Quarterly Results
DXCDXC Technology(DXC)2025-02-04 21:17

Revenue Performance - Total revenue for Q3 FY2025 was 3.23billion,down5.13.23 billion, down 5.1% year-over-year and down 4.2% on an organic basis[6]. - Revenues for the three months ended December 31, 2024, were 3,225 million, a decrease of 5.1% compared to 3,399millionforthesameperiodin2023[27].−GlobalBusinessServicesrevenuewas3,399 million for the same period in 2023[27]. - Global Business Services revenue was 1.67 billion, down 1.8% year-over-year, while Global Infrastructure Services revenue was 1.56billion,down8.51.56 billion, down 8.5% year-over-year[9]. - Total revenue growth for the nine months ended December 31, 2024, was down 5.6%, compared to a decline of 5.1% in the previous year[38]. - Consulting & Engineering Services revenue for Q3 FY25 was 1,270 million, a slight decrease from 1,281 million in Q2 FY25[41]. - Cloud, ITO & Security revenue remained stable at 1,184 million in Q3 FY25, compared to 1,188 million in Q2 FY25[41]. - Insurance Software & BPS revenue was consistent at 396 million for both Q3 FY25 and Q2 FY25[41]. Profitability Metrics - EBIT margin was 4.5%, with adjusted EBIT margin at 8.9%, reflecting a year-over-year increase of 11.7%[7]. - Diluted earnings per share decreased to 0.31,down61.70.31, down 61.7% year-over-year, while non-GAAP diluted EPS increased by 7.0% to 0.92[7]. - Segment profit for Global Business Services (GBS) for the three months ended December 31, 2024, was 224million,representingaprofitmarginof13.4224 million, representing a profit margin of 13.4%[31]. - Segment profit for Global Infrastructure Services (GIS) for the three months ended December 31, 2024, was 101 million, with a profit margin of 6.5%[31]. - Adjusted EBIT for the nine months ended December 31, 2024, increased to 789million,up8.8789 million, up 8.8% from 725 million in the same period of 2023[39]. - Basic EPS for the quarter was reported at 0.94,whiledilutedEPSwas0.94, while diluted EPS was 0.92, showing a positive trend in earnings per share[33]. Cash Flow and Financial Position - Cash generated from operations was 650million,down7.9650 million, down 7.9% year-over-year, with free cash flow at 483 million compared to 585millioninQ3FY2024[7].−FreecashflowfortheninemonthsendedDecember31,2024,was585 million in Q3 FY2024[7]. - Free cash flow for the nine months ended December 31, 2024, was 1,083 million, slightly up from 1,081millionforthesameperiodin2023[29].−CashandcashequivalentsattheendoftheperiodonDecember31,2024,were1,081 million for the same period in 2023[29]. - Cash and cash equivalents at the end of the period on December 31, 2024, were 1,723 million, an increase from 1,224millionatthebeginningoftheyear[29].−TotalassetsasofDecember31,2024,were1,224 million at the beginning of the year[29]. - Total assets as of December 31, 2024, were 13,033 million, a decrease from 13,871millionasofMarch31,2024[28].−TotalliabilitiesasofDecember31,2024,were13,871 million as of March 31, 2024[28]. - Total liabilities as of December 31, 2024, were 9,781 million, down from 10,805millionasofMarch31,2024[28].GuidanceandFutureOutlook−Full−yearadjustedEBITmarginguidanceincreasedtoapproximately7.910,805 million as of March 31, 2024[28]. Guidance and Future Outlook - Full-year adjusted EBIT margin guidance increased to approximately 7.9%, up from previous guidance of 7.0% to 7.5%[9]. - Full-year non-GAAP diluted EPS guidance raised to approximately 3.35, compared to prior guidance of 3.00to3.00 to 3.25[9]. - Free cash flow guidance for the full year increased to approximately 625million,upfrompriorguidanceof625 million, up from prior guidance of 550 million[9]. - The company is focused on strategic changes to improve bookings performance and drive sustainable revenue growth[4]. - Future outlook includes continued focus on mergers, acquisitions, and strategic investments to drive growth[34]. Restructuring and Costs - The company reported restructuring costs of 43millionforthethreemonthsendedDecember31,2024,comparedto43 million for the three months ended December 31, 2024, compared to 36 million in the same period of 2023[27]. - The company incurred 43millioninrestructuringcosts,primarilyrelatedtoworkforceandrealestateoptimization[34].−Transaction,separation,andintegration−relatedcostsamountedto43 million in restructuring costs, primarily related to workforce and real estate optimization[34]. - Transaction, separation, and integration-related costs amounted to 87 million, reflecting ongoing strategic initiatives[34]. - Amortization of acquired intangible assets was 12million,indicatingcontinuedinvestmentinacquiredtechnologies[34].−Thecompanyreportedimpairmentlossesof12 million, indicating continued investment in acquired technologies[34]. - The company reported impairment losses of 12 million for the nine months ended December 31, 2024, compared to 5millioninthesameperiodof2023[39].TaxandIncome−Theeffectivetaxratefortheperiodwas35.15 million in the same period of 2023[39]. Tax and Income - The effective tax rate for the period was 35.1%, down from 51.9% in the prior year, indicating improved tax efficiency[33]. - The effective tax rate for the three months ended December 31, 2023, was 54.5%, compared to 33.9% in the previous year[36]. - Net income attributable to DXC common stockholders for the three months ended December 31, 2024, was 57 million, down 63.5% from 156millioninthesameperiodof2023[27].−NetincomeattributabletoDXCcommonstockholdersforthethreemonthsendedDecember31,2024,was156 million in the same period of 2023[27]. - Net income attributable to DXC common stockholders for the three months ended December 31, 2024, was 170 million, reflecting a significant increase compared to previous periods[33]. - Net income for Q3 FY25 was 63million,adecreaseof5563 million, a decrease of 55% compared to 140 million in Q3 FY24[39].