Core Viewpoint - The company is implementing a "diversified computing power" strategy to meet diverse market demands, actively collaborating with domestic AI chip manufacturers to enhance its ecosystem [1] Group 1: Strategic Initiatives - The company has established partnerships with over 20 domestic AI chip manufacturers [1] - The AI Station software platform is compatible with more than 30 domestic AI chips, showcasing the company's commitment to integration [1] Group 2: Ecosystem Development - The company is advancing open computing standards such as OAM, OCM, and liquid-cooled cabinets to accelerate the development of a domestic intelligent computing ecosystem [1] - Continuous efforts are being made to foster collaboration with more domestic AI manufacturers [1]

Group 1 - The article discusses the digital service demand chain for government and enterprise clients, highlighting the strengths of IT companies and telecom operators in different areas of this chain [2] - IT companies excel in hardware manufacturing and software development, while telecom operators are proficient in communication networks, cloud services, and customer support [2] - The capabilities of IT companies allow them to integrate digital demand chains from a product perspective, while telecom operators can integrate from a customer perspective [2] Group 2 - IT companies and telecom operators represent two distinct types of enterprises: R&D manufacturing firms and operational service firms, respectively [3] - R&D manufacturing firms focus on specialized division of labor and centralized organization, while operational service firms prioritize user proximity and decentralized organization [4] - The core competencies of R&D firms revolve around advanced R&D and manufacturing capabilities, whereas operational firms focus on enhancing their operational and service capabilities [4]

Group 1 - The article compares two stocks in the Computers - IT Services sector: Cognizant (CTSH) and ServiceNow (NOW), focusing on which stock offers better value for investors [1] - Cognizant has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while ServiceNow has a Zacks Rank of 3 (Hold) [3] - Value investors typically analyze traditional metrics such as P/E ratio, P/S ratio, earnings yield, and cash flow per share to identify undervalued stocks [4] Group 2 - Cognizant's forward P/E ratio is 15.39, significantly lower than ServiceNow's forward P/E of 59.66, suggesting better value [5] - Cognizant has a PEG ratio of 1.78, while ServiceNow's PEG ratio is 2.52, indicating that Cognizant may offer more value relative to its expected earnings growth [5] - Cognizant's P/B ratio is 2.59 compared to ServiceNow's P/B of 20.08, further supporting Cognizant's superior valuation metrics and its Value grade of B versus ServiceNow's F [6]

Financial Data and Key Metrics Changes - Consolidated gross profit for Q1 2025 was $22 million, a 7.9% increase over Q1 2024, marking the highest gross profit in the past twelve quarters [21] - Adjusted EBITDA for Q1 2025 was $7.8 million, compared to $6.2 million for Q1 2024, reflecting a growth of 14.4% [21] - Adjusted EPS for Q1 2025 was $0.63, up from $0.53 in Q1 2024, indicating an 18.9% increase [21] Business Line Data and Key Metrics Changes - In healthcare, gross profit for Q1 2025 was $12.2 million, compared to $11.1 million in Q1 2024, growing 10.2% [21] - Engineering gross profit for Q1 2025 was $6.2 million, up from $5.5 million in Q1 2024, a growth of 12.4% [22] - In IT, life sciences, and data solutions, gross profit for Q1 2025 was $3.6 million, down from $3.8 million in Q1 2024, a decline of 5.3% [25] Market Data and Key Metrics Changes - School revenue for Q1 2025 was $37.3 million, compared to $31.9 million in Q1 2024, reflecting a growth of 16.7% [22] - Non-school revenue for Q1 2025 was $6 million, slightly down from $6.3 million in Q1 2024, but would have been $5.5 million versus $5.1 million if excluding a large long-term care group [22] Company Strategy and Development Direction - The company is focused on cultivating the next generation of leadership and enhancing operational efficiency to ensure long-term success [4] - There is a strong emphasis on revenue expansion and new client acquisition, particularly in the healthcare and engineering sectors [6][9] - The company is capitalizing on technological advancements in AI and machine learning, with a significant expansion in manufacturing across its life sciences client base [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties, focusing on secular themes that can drive growth [30] - The outlook for the business is strong, with expectations of continued low double-digit growth in adjusted EBITDA throughout fiscal 2025 [26] - Management anticipates Q4 2025 will produce the highest adjusted EBITDA quarter for the year [26] Other Important Information - The company has retired over 300,000 shares year-to-date, bringing the total repurchase over the last five years to nearly half of shares outstanding [20] - The balance sheet remains clean with significant financial flexibility and resilient organic growth [20] Q&A Session Summary Question: Is political policy uncertainty affecting the business? - Management indicated that they have not encountered significant issues related to the macroeconomic environment and are focused on leveraging secular themes for growth [30] Question: Regarding healthcare gross margins, is the lower margin due to legacy business? - Management clarified that the lower gross margin is more of a quarterly fluctuation rather than a trend, with expectations for improvement in Q2 [32][33]

Financial Data and Key Metrics Changes - For fiscal year 2025, the company reported signings growth of 48% in constant currency, totaling over $18 billion [6] - Adjusted pretax income increased by $317 million to $482 million, with adjusted free cash flow rising by 53% to $446 million [6][27] - The fourth quarter revenue reached $3.8 billion, reflecting a 1.3% year-over-year increase in constant currency [22] Business Line Data and Key Metrics Changes - Kindrel Consult's revenue grew by 45% in the fourth quarter and 50% in signings for fiscal year 2025, accounting for 22% of total signings [23][15] - Hyperscaler-related revenue more than doubled to $1.2 billion for the year, significantly exceeding the target of $1 billion [25][7] - The company achieved $900 million in annualized savings from its accounts initiative, surpassing its target for the year [26] Market Data and Key Metrics Changes - The company secured 55 contracts valued over $50 million in fiscal year 2025, with nearly half exceeding $100 million [10] - The signings growth was broad-based across various geographies and vertical markets, indicating strong demand for services [9] - The revenue book-to-bill ratio remained above one, suggesting future revenue growth from committed contracts [10] Company Strategy and Development Direction - The company is focused on leveraging its capabilities, partnerships, and innovation to drive sustainable growth [5] - The 3A initiatives have transitioned from turnaround drivers to pillars of profitable growth [7] - The company aims to address secular IT trends such as cloud migration, hybrid IT environments, and cybersecurity risks [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic uncertainties, citing the essential nature of its services [20][19] - The outlook for fiscal year 2026 includes expectations for substantial earnings and cash flow growth, with a target of at least $725 million in adjusted pretax income [18][33] - Management highlighted the importance of continued investment in innovation and capabilities to maintain growth momentum [45] Other Important Information - The company plans to balance capital allocation between organic growth investments and share repurchase programs [73] - The fiscal year 2026 outlook anticipates a 1% revenue growth in constant currency, with hyperscaler-related revenue expected to reach $1.8 billion [32][33] - The company maintains a strong liquidity position with nearly $5 billion available at quarter-end [30] Q&A Session Summary Question: Accomplishments in 2025 and positioning for 2026 - Management reflected on the successful execution of their strategy and expressed confidence in their ability to control their own destiny moving forward [42][45] Question: Progress with focus accounts - Management indicated they are approximately 75% through their focus accounts, having achieved 90% of targeted savings [50][48] Question: Book-to-bill ratio maintenance - Management confirmed expectations to maintain a book-to-bill ratio above one, driven by strong performance in consult and hyperscaler-related services [55] Question: Revenue growth guidance - Management explained that while signings growth was strong, they are not relying solely on revenue growth to achieve profit improvement, emphasizing the importance of backlog [66][69] Question: Impact of macro uncertainties on strategic accounts - Management noted that their services are essential for productivity, which tends to be a tailwind during uncertain macro conditions [81][84] Question: Role of Kindle Bridge in macro conditions - Management affirmed that Kindle Bridge can help uncover unused resources and provide leverage in uncertain macro conditions [86]

Financial Data and Key Metrics Changes - Kyndryl reported a 48% increase in signings in constant currency, totaling over $18 billion for fiscal year 2025 [6] - Adjusted pretax income rose by $317 million to $482 million, with adjusted free cash flow increasing by 53% to $446 million [6][27] - The fourth quarter revenue reached $3.8 billion, reflecting a 1.3% year-over-year increase in constant currency [22] Business Line Data and Key Metrics Changes - Kyndryl Consult's revenue grew by more than 25% for the year, with consult signings increasing by 50% in constant currency [7][14] - Hyperscaler-related revenue more than doubled to $1.2 billion for the year, significantly exceeding the target of nearly $1 billion [26] - The adjusted EBITDA margin for the fourth quarter was 18.4%, up 370 basis points year-over-year [24] Market Data and Key Metrics Changes - The company secured 55 contracts valued at over $50 million in fiscal year 2025, an increase from 40 contracts in the prior year [10] - Nearly half of these contracts were valued over $100 million, indicating strong demand across various geographies and verticals [10] - The revenue book-to-bill ratio remained above one, indicating future revenue growth from committed contracts [10] Company Strategy and Development Direction - Kyndryl's strategy focuses on building capabilities, partnerships, and innovation to drive sustainable growth, particularly in mission-critical technology services [5] - The company aims to leverage its expanded capabilities and strong customer relationships to win higher value opportunities [12] - The 3A initiatives have shifted from turnaround drivers to pillars of profitable growth, with expectations for substantial earnings and cash flow growth in fiscal year 2026 [8][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic uncertainties, emphasizing the essential nature of its technology services [20][21] - The outlook for fiscal year 2026 includes expectations for approximately $550 million in adjusted free cash flow and at least $725 million in adjusted pretax income [19][34] - Management highlighted the importance of continued investment in innovation and capabilities to maintain growth momentum [46] Other Important Information - Kyndryl's cash balance was $1.8 billion, with nearly $5 billion in liquidity at quarter end [31] - The company has a target to keep net leverage below one times adjusted EBITDA, ending the quarter at 0.6 times [32] - The fiscal year 2026 outlook assumes a 1% revenue growth in constant currency, with hyperscaler-related revenue expected to reach $1.8 billion [33][34] Q&A Session Summary Question: Accomplishments in 2025 and positioning for 2026 - Management reflected on the successful execution of their strategy and expressed confidence in their ability to control their own destiny through continued investment in innovation [44][46] Question: Progress with focus accounts - Management indicated they are approximately 75% through their focus accounts, having achieved 90% of targeted savings, with a revised target of $1 billion in annualized benefits [50][52] Question: Book to bill ratio and backlog duration - Management confirmed expectations to maintain a book to bill ratio above one, driven by strong performance in consult and hyperscaler-related services [58] Question: Revenue growth guidance - Management explained that while signings growth was strong, they are not relying solely on revenue growth to achieve profit improvement, as a significant portion of revenue is already contracted [70][72] Question: Impact of macro uncertainties on strategic accounts - Management noted that uncertainty tends to be a tailwind for their business, as clients seek to optimize their infrastructure in response to macro conditions [82][84] Question: Role of Kyndryl Bridge in uncertain conditions - Management affirmed that Kyndryl Bridge can help uncover unused resources and provide actionable insights, aiding clients in optimizing their operations [88][90]

Core Insights - DXC Technology has launched DXC Complete with SAP and Microsoft to facilitate modernization for SAP customers, providing a streamlined approach to adopting RISE with SAP and GROW with SAP journeys on Microsoft Azure [1][2][3] - The offering includes flexible pricing models and a single contract, enabling enterprises to optimize operations and achieve sustainable growth through transformation to SAP S/4HANA Cloud [1][3] Company Overview - DXC Technology is recognized as a leading global technology services provider, helping businesses modernize IT and optimize data architectures while ensuring security and scalability across various cloud environments [7] - The company has a global team of over 50,000 engineers and consultants, delivering tailored SAP solutions that address industry-specific challenges and drive measurable results [6] Collaboration Highlights - The collaboration between DXC, SAP, and Microsoft aims to simplify technology landscapes, reduce technical debt, and accelerate innovation for clients [2][3] - Microsoft Azure integration with SAP Business AI enhances intelligent automation, predictive insights, and streamlined processes, creating a more connected enterprise [6] Awards and Recognition - DXC Technology has been named a 2025 SAP Pinnacle Awards Winner in the "Partner Learning and Skills Growth" category, highlighting its excellence in co-innovation and customer success [4]

Financial Data and Key Metrics Changes - In Q1 2025, the company generated revenue of $1.3 billion, reflecting an 11.7% year-over-year increase on a reported basis [27] - Organic constant currency revenue grew by 1.4% compared to Q1 2024, exceeding initial expectations of flat organic growth [27] - GAAP gross margin for the quarter was 26.9%, down from 28.4% in Q1 2024, while non-GAAP gross margin was 28.7%, compared to 30.4% in the same period last year [32][33] - GAAP income from operations was $99 million (7.6% of revenue), down from $111 million (9.5% of revenue) in Q1 2024 [34] - Non-GAAP diluted EPS was $2.41, a decrease from $2.46 in Q1 2024 [34] Business Line Data and Key Metrics Changes - Financial services delivered strong growth of 29.3% year-over-year, with 4.5% organic growth in constant currency, driven by strength in insurance, banking, and payments [28] - Software and high-tech grew by 9.6% year-over-year, while life sciences and healthcare increased by 10.5% [28] - Consumer goods, retail, and travel decreased by 1.4% year-over-year, largely due to declines in consumer products and retail [29] - Emerging verticals delivered very strong growth of 22.8%, positively impacted by Neoris Industrial Materials customers [29] Market Data and Key Metrics Changes - The Americas, representing 60% of Q1 revenues, grew by 12.6% year-over-year, while EMEA, representing 38% of revenues, increased by 10.7% [30] - APAC, representing 2% of revenues, saw a growth of 4.3% year-over-year [30] - Revenues from the top 20 clients grew by 6.1% year-over-year, while revenues from clients outside the top 20 increased by 14.6% [31] Company Strategy and Development Direction - The company is focused on driving organic growth and maintaining momentum in AI-related capabilities, which are expected to continue throughout the year [10][19] - A planned leadership transition is underway, with Balas Feyros set to become the new CEO on September 1, 2025, indicating a strategic shift towards AI-native transformation [7][8] - The company aims to improve gross margins and utilization rates while navigating macroeconomic uncertainties [33][66] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the second half of 2025, despite macroeconomic uncertainties, citing strong client demand and engagement [12][15] - The company has not seen a material slowdown in client spending, with ongoing improvements in demand for services [39] - Management highlighted a trend of clients returning to EPAM for quality execution after experiencing underperformance with other partners [15] Other Important Information - The company reported cash flow from operations of $24 million in Q1, down from $130 million in the same quarter of 2024, attributed to higher bonus payments and increased days sales outstanding (DSO) [35] - Free cash flow was $15 million, compared to $123 million in Q1 2024 [35] - The company ended Q1 with over 61,700 employees, reflecting total growth of 18.2% and organic growth of 6.4% compared to Q1 2024 [36] Q&A Session Summary Question: Can you provide more color on the second half confidence and underlying macro? - Management indicated that the outlook for the second half remains consistent with previous projections, with no significant changes observed in client purchasing behavior [51][53] Question: How should we expect free cash flow to trend as we move through the year? - Management expects free cash flow conversion to remain around 80% to 90%, with elevated DSO likely to persist due to fixed fee revenues [58][59] Question: Are you sensing any pricing power as organic demand picks up? - Management stated it is too early to call for pricing increases, noting that improvements in demand are still relatively small [60] Question: Can you discuss plans to improve gross margin over the remainder of the year? - Management highlighted seasonal factors that typically benefit the second half and emphasized a renewed focus on improving utilization [65] Question: What are the growth dynamics within customer cohorts? - Management noted a visible trend of clients returning, contributing to improvements in revenue growth outside the top 20 clients [71][72]

Core Insights - Unisys has been recognized as a leader in the 2025 Cognitive & Self-Healing IT Infrastructure Management report by NelsonHall for the fifth consecutive year, highlighting its strengths in AI, server-centric services, and cognitive service desk capabilities [1][2] - The report emphasizes Unisys's commitment to investing in AI capabilities, intellectual property, talent, and reskilling to enhance its cognitive and self-healing IT infrastructure management services [1] Company Strengths - Unisys is focused on delivering tangible results for clients throughout their IT management journey, with an emphasis on innovative cloud offerings that support the transition to AI capabilities and intelligent operations [3][4] - The company provides AI-enabled consulting and advisory services to assist clients in becoming AI-ready enterprises, including a framework for developing and operating AI systems tailored to specific industries [4][7] - Unisys has extensive intellectual property and accelerators that facilitate automation in AI operations, IT operations, hybrid cloud, and self-healing automation [7] - The company has a strong focus on cybersecurity capabilities, including zero trust readiness assessments and threat analysis, to enhance the security of cloud operations [7]

Fourth Quarter 2025 Earnings May 8, 2025 Disclaimers Forward-looking statements This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements often contain words such as "aim," "anticipate," "believe," "could," "estimate," "expect," "forecast," "intend," "may," "objectives," "opportunity," "plan," "position," "predict," "project," "should," "seek," "target," "will," "would" and other similar words or expres ...