Core Insights - Cycurion, Inc. has secured a $1.1 million contract through its subsidiary SLG Innovation, Inc. to modernize legacy data systems for a major county-level public guardian office in the U.S. [1][2] - The project involves migrating sensitive data from outdated systems to a secure Microsoft SQL Server platform, enhancing data integrity and accessibility [2][3] - Cycurion's CEO emphasized the importance of this contract as a demonstration of the company's resilience and capability to deliver essential services during fiscal disruptions [3] Company Overview - Cycurion is a publicly traded company specializing in AI-powered technology and staffing solutions for the public sector, with a focus on cybersecurity and IT modernization [1][4] - The company has a significant backlog of $73.6 million and has achieved over 30 major wins in 2025, maintaining a 98% client retention rate [3] - Cycurion operates with a mission-critical designation, ensuring uninterrupted delivery of essential services even during government shutdowns [3][4]

Core Insights - Cycurion, Inc. has secured a $1.1 million contract through its subsidiary SLG Innovation, Inc. to modernize legacy data systems for a major county-level public guardian office in the U.S. [1][3] - The project aims to migrate sensitive data from outdated systems to a secure Microsoft SQL Server platform, enhancing data integrity and accessibility [2][3] - Cycurion's CEO emphasized the importance of this contract as a demonstration of the company's resilience and capability to deliver essential services during fiscal disruptions [3] Company Overview - Cycurion is a publicly traded company specializing in AI-powered technology and staffing solutions for the public sector, focusing on IT cybersecurity and business continuity [4] - The company operates with a significant backlog of $73.6 million, indicating strong demand for its services [3] - Cycurion has achieved over 30 major wins in 2025 and maintains a 98% client retention rate, showcasing its effectiveness in government transformation projects [3]

Financial Performance & Outlook - Kyndryl's Q2 2026 adjusted EBITDA reached $641 million, a year-over-year increase from $557 million in Q2 2025[43] - The adjusted EBITDA margin increased by 250 basis points, reaching 17.2% in Q2 2026 compared to 14.8% in Q2 2025[43] - Adjusted pretax income for Q2 2026 was $123 million, significantly up from $45 million in Q2 2025[43] - The company reaffirms its fiscal year 2026 outlook, projecting adjusted pretax income of at least $725 million, a year-over-year increase of at least 50%[51] - Kyndryl anticipates approximately 1% constant-currency revenue growth for fiscal year 2026[51] Growth Drivers - Kyndryl Consult revenue reached $3.4 billion (LTM Sept 2025), a 32% increase compared to $2.5 billion (LTM Sept 2024)[19] - Hyperscaler-related revenue increased by 94%, reaching $1.5 billion (LTM Sept 2025) compared to $0.8 billion (LTM Sept 2024)[19] - The company's signings reached $15.6 billion[19] Capital Allocation - The company increased its repurchase authorization by $400 million[17]

Core Insights - Kyndryl has announced the acquisition of Solvinity Group B.V., enhancing its portfolio to provide customers with modernized, innovative, and secure solutions for sensitive workloads [1][2]. Company Overview - Kyndryl is a leading provider of mission-critical enterprise technology services, operating in over 60 countries and offering advisory, implementation, and managed services [4]. Acquisition Details - The acquisition aims to combine Kyndryl's capabilities with Solvinity's secure managed cloud platforms, focusing on enhancing security and compliance for sensitive workloads [2]. - The transaction's terms were not disclosed, and it is subject to customary closing conditions, including regulatory approval [3]. Strategic Implications - This acquisition reflects Kyndryl's commitment to investing in mission-critical capabilities, enabling customers to meet increasing regulatory requirements and adapt to a rapidly evolving market [2]. - The integration of Solvinity's private and hybrid cloud offerings will allow Kyndryl to support customers in managing workloads with stringent security needs [2].

Core Insights - Morrisons has entered a five-year agreement with Tata Consultancy Services (TCS) to enhance digital transformation efforts [1] - The partnership aims to improve operational efficiency and customer experience across Morrisons' core business areas [4] Group 1: Digital Transformation Initiatives - TCS will assist Morrisons in aligning retail, e-commerce, and marketing operations, expediting the delivery of digital products [1] - The collaboration includes supply chain transformation projects that have improved stock availability, reduced waste, and shortened lead times [2] - TCS will establish an automation factory and a Business Intelligent Command Centre (BICC) to enable proactive problem-solving and data-driven decision-making [2] Group 2: Technological Enhancements - The agreement encompasses modernization of legacy systems and integration of AI-powered tools to enhance service outcomes [4] - TCS will provide end-to-end engineering services, including application design, development, testing, and maintenance [3] - The partnership will also revamp Morrisons' digital platforms for loyalty, marketing, e-commerce, and retail to consolidate vendors and improve operational synergy [4] Group 3: Company Performance and Market Position - TCS reported a 10% growth and a 7.6% market share in the UK, with revenues of $4.58 billion (£3.51 billion) in fiscal year 2024 [5] - Morrisons is the fifth-largest supermarket chain in the UK, serving customers through physical stores and online channels [5] - TCS has been active in the UK for over five decades, collaborating with more than 200 major British brands [5]

Core Insights - Kyndryl Holdings, Inc. reported revenue of $3.72 billion for the quarter ended September 2025, a decrease of 1.4% year-over-year, and an EPS of $0.38, up from $0.01 in the same quarter last year [1] - The reported revenue fell short of the Zacks Consensus Estimate of $3.82 billion, resulting in a surprise of -2.49%, while the EPS exceeded the consensus estimate of $0.35 by 8.57% [1] Financial Performance - Kyndryl's stock has returned -6.1% over the past month, underperforming the Zacks S&P 500 composite, which increased by 2.1% [3] - The company currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3] Geographic Revenue Breakdown - Revenue from Japan was reported at $581 million, slightly below the average estimate of $588.81 million from three analysts [4] - Revenue from the United States was $899 million, also below the average estimate of $964.38 million [4] - Strategic Markets generated $906 million, exceeding the average estimate of $894.6 million [4] - Principal Markets revenue was $1.33 billion, slightly below the average estimate of $1.37 billion [4] Adjusted EBITDA Analysis - Adjusted EBITDA for Principal Markets was $210 million, surpassing the average estimate of $199.05 million from two analysts [4] - Adjusted EBITDA for Corporate and other segments was reported at -$28 million, worse than the average estimate of -$24 million [4] - Adjusted EBITDA for Strategic Markets was $142 million, below the average estimate of $157.43 million [4]

Kyndryl Holdings reported a slight drop in second-quarter revenue on Tuesday, as the former IBM unit works to reduce and renegotiate inherited contracts that have hampered margins. ...

Core Insights - Kyndryl Holdings, Inc. reported a second-quarter earnings beat with adjusted earnings per share of 38 cents, surpassing the analyst consensus estimate of 36 cents [1] - The company is expanding its AI services in multiple countries and has increased share buybacks [1] Financial Performance - Quarterly revenues were $3.721 billion, a 1% decline year over year, which slightly missed the expected $3.840 billion [2] - Sales fell 3.7% in constant currency, reflecting efforts to exit low-margin third-party content and longer sales cycles [3] - Adjusted EBITDA was $641 million, marking a 15% year-over-year increase [5] Segment Performance - Hyperscaler cloud revenue surged 65% to $440 million, positioning the company to meet its $1.8 billion target for 2026 [4] - Kyndryl Consult revenues grew 28% year-over-year, with signings increasing by 11% over the past twelve months [4] - The book-to-bill ratio remained above 1 for the fifth consecutive quarter, with AI-related signings accounting for about 25% of last quarter's total [4] AI Expansion - Kyndryl is enhancing its AI capabilities by establishing technology hubs in England, France, and Singapore, and launching an AI Innovation Lab in India [5] Share Buyback and Cash Position - The company repurchased 2.9 million shares for $89 million in the second quarter and has approved an additional $400 million for share buybacks [6] - Kyndryl ended the quarter with cash and equivalents of $1.33 billion, down from $1.786 billion as of March 31, 2025 [6] Future Outlook - For fiscal year 2026, Kyndryl anticipates constant-currency revenue growth of 1%, equating to approximately $15.20 billion, below the analyst consensus of $15.60 billion [8] - The company projects an adjusted EBITDA margin of around 18%, reflecting a year-over-year increase of approximately 130 basis points [8] - Kyndryl expects activity to strengthen in the second half of fiscal 2026, supported by a robust pipeline and positive discussions with customers [9] Long-term Goals - The company aims to more than double adjusted pretax income by fiscal year 2028, contingent on achieving sustainable mid-single-digit revenue growth [10]

Core Insights - Kyndryl's second quarter performance indicates momentum in key growth areas such as Kyndryl Consult, partnerships with hyperscalers, and innovative services in AI, cloud, and security [1][2] Financial Performance - Kyndryl reported revenues of $3.7 billion for the second quarter, a decrease of 1% year-over-year and 3.7% in constant currency [2][6] - The company achieved pretax income of $98 million, a significant increase from a pretax loss of $5 million in the prior-year period [2][6] - Net income was $68 million, or $0.29 per diluted share, compared to a net loss of $43 million, or ($0.19) per diluted share, in the same quarter last year [2][6] - Adjusted pretax income rose to $123 million, up from $45 million year-over-year, reflecting contributions from Kyndryl's three-A initiatives [3][6] - Adjusted EBITDA increased by 15% year-over-year to $641 million [3][6] Strategic Initiatives - Kyndryl's signings for the trailing twelve months reached $15.6 billion, surpassing the previous twelve months' revenue of $15.0 billion [4][6] - The company is focused on expanding customer relationships and maintaining attractive margins, with a goal of generating over $1 billion in free cash flow by fiscal 2028 [4][6] - Kyndryl announced a $400 million increase in its share repurchase program, in addition to the previously authorized $300 million buyback [5][6] Market Outlook - Kyndryl reaffirms its fiscal 2026 outlook, expecting stronger second-half revenue driven by backlog contributions and growth in Kyndryl Consult and hyperscaler-related revenue [8][6] - The company generated $440 million in revenue from cloud hyperscaler alliances, marking a 65% year-over-year increase, and is on track to exceed its initial hyperscaler revenue target of $1.8 billion for fiscal 2026 [11][6] - Kyndryl Consult revenues grew by 28% year-over-year, with signings increasing by 11% over the last twelve months [11][6]

Financial Data and Key Metrics Changes - Third quarter consolidated net sales were $5.7 billion, up 4% year-over-year [6] - Gross profit was $1.3 billion, up 5% [6] - Non-GAAP operating income was $531 million, down 1% [6] - Non-GAAP net income per share was $2.71, up 3% [23] - Adjusted free cash flow was $209 million [25] Business Line Data and Key Metrics Changes - Small Business delivered double-digit growth in top line and gross profit, driven by cloud and client device solutions [9] - Corporate delivered mid-single-digit top line growth with low single-digit gross profit [9] - Government net sales increased 8%, with state and local showing double-digit growth [10] - Healthcare gross profit grew faster than its 7% top line growth, driven by cloud solutions [11] - Services grew 9% top line, with managed and professional services up 14% [60] Market Data and Key Metrics Changes - U.K. and Canadian operations reported a 9% increase in net sales [11] - Demand for client devices remained strong, driven by Windows 10 end-of-life transitions [20] - Netted down revenues represented 36% of gross profit, up from 35.7% in Q3 2024 [20] Company Strategy and Development Direction - The company is embedding AI into its operations to enhance productivity and efficiency [15] - Focus on delivering enterprise-grade AI solutions that are practical and scalable [16] - Maintaining a prudent full-year outlook with expectations for low single-digit growth in the U.S. IT market [17] Management's Comments on Operating Environment and Future Outlook - The current environment is characterized by volatility and uncertainty, impacting investment decisions [50] - The company is navigating a complex environment with a focus on execution and customer value [28] - Expectation for continued frictional impacts in government education segments and potential funding shortfalls in healthcare [28] Other Important Information - Non-GAAP SG&A totaled $725 million, up 8.7% year-over-year [21] - The company returned approximately $150 million in share repurchases and $82 million in dividends [25] - The dividend was increased by approximately 1% to $2.52 annually [26] Q&A Session Summary Question: Impact of government shutdown on federal contribution - Management has taken a conservative view of Q4, expecting some pipeline and backlog but acknowledging constraints due to the shutdown [34][35] Question: Drivers of small business growth - Small businesses are leaning more into technology for competitive advantage, showing resilience [37][39] Question: Outlook for PC and endpoint market - Solid demand is expected to continue in the near term, driven by Windows 10 end-of-life and AI productivity initiatives [42][43] Question: Complexity of current spending environment - The primary issue is volatility and uncertainty affecting investment commitments [50][52] Question: Healthcare market dynamics - Healthcare has been strong, but funding shifts may create some lumpiness in growth [78] Question: Profitability and margin outlook - Non-netted down margins have held up, with expectations for stability in Q4 [81]