DXC Technology (NYSE:DXC) Announces Earnings Results

DXC Technology (NYSE:DXC) released its earnings results on Thursday. The company reported $0.67 earnings per share for the quarter, topping analysts’ consensus estimates of $0.55 by $0.12, FiscalAI reports. The business had revenue of $3.03 billion for the quarter, compared to analyst estimates of $2.98 billion. DXC Technology had a net margin of 0.91% and a return on equity of 14.35%. The business’s revenue was down 4.1% on a year-over-year basis. During the same period last year, the company posted $0.84 EPS.

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

• Full-year guidance was reduced: DXC now expects organic revenue to decline 5%–5.5%, adjusted EBIT margin of 5.75%–6.25%, non-GAAP EPS of $2.25–$2.50, and free cash flow of approximately $600 million. The revision reflects weaker second-quarter bookings and lower pipeline conversion assumptions for the remainder of the year.
• Second-quarter revenue fell 4% year over year to $3.0 billion, while adjusted EBIT margin declined 180 basis points to 6.2% and non-GAAP EPS dropped to $0.67 from $0.84. Bookings declined 10% year over year, with weakness most pronounced in the Americas and UKI.
• AI and agentic offerings are gaining traction: DXC has certified more than 5,700 employees in AI, reported a sixfold increase in OASIS utilization, and secured its first large GrowthX modernization win with a global bank. Management also cited growing pipelines for AI-powered Smart Apps and new cybersecurity offering Frontier Code Assurance.
• Management said traditional project decisions are taking longer as customers reassess investments amid the shift toward AI, with some large deals delayed and some smaller opportunities lost. DXC expects GIS revenue to improve sequentially in the third quarter and more significantly in the fourth quarter, but its guidance does not assume a recovery in conversion rates.
• DXC confirmed it is in ongoing discussions regarding a possible sale of its insurance business while emphasizing that it is evaluating strategic actions to create shareholder value. The company also retired $400 million of debt, repurchased $60 million of shares, and ended the quarter with $213 million of free cash flow excluding a tax-related cash deposit.

DXC Technology Trading Down 1.6%

DXC traded down $0.25 on Friday, hitting $14.98. The company had a trading volume of 9,279,216 shares, compared to its average volume of 5,208,369. The firm has a market cap of $2.39 billion, a P/E ratio of 23.05 and a beta of 0.79. DXC Technology has a 1 year low of $7.90 and a 1 year high of $16.38. The company’s fifty day moving average price is $12.28 and its 200 day moving average price is $11.59. The company has a current ratio of 1.41, a quick ratio of 1.41 and a debt-to-equity ratio of 0.90.

Analysts Set New Price Targets

DXC has been the subject of a number of analyst reports. JPMorgan Chase & Co. upped their price objective on shares of DXC Technology from $12.00 to $13.00 and gave the company an “underweight” rating in a report on Friday. TD Cowen lifted their target price on shares of DXC Technology from $10.00 to $12.00 and gave the stock a “hold” rating in a research note on Monday, August 3rd. Morgan Stanley set a $12.00 target price on shares of DXC Technology in a report on Monday, August 3rd. Royal Bank Of Canada dropped their price target on shares of DXC Technology from $16.00 to $14.00 and set a “sector perform” rating for the company in a research note on Friday, July 31st. Finally, Weiss Ratings upgraded shares of DXC Technology from a “sell (d)” rating to a “sell (d+)” rating in a report on Tuesday, October 6th. Seven analysts have rated the stock with a Hold rating and three have given a Sell rating to the company. According to MarketBeat.com, DXC Technology currently has a consensus rating of “Reduce” and a consensus price target of $12.06.

DXC Technology News Summary

Here are the key news stories impacting DXC Technology this week:

• Positive Sentiment: Quarterly results exceeded expectations: DXC reported fiscal Q2 FY2027 non-GAAP EPS of $0.67, above the $0.55 consensus estimate, while revenue of $3.03 billion topped expectations of $2.98 billion. DXC Technology Q2 Earnings and Revenues Beat Estimates
• Positive Sentiment: Cash flow improved: First-half fiscal 2027 free cash flow rose to $405 million from $337 million a year earlier, and DXC repurchased $60 million of stock during the quarter. DXC Technology Reports Second Quarter Fiscal Year 2027 Results
• Neutral Sentiment: Susquehanna raised its price target on DXC from $10 to $12 but maintained a “neutral” rating. The new target still implies roughly 20% downside from the referenced share price, signaling limited analyst confidence despite the higher valuation estimate. Susquehanna Raises DXC Price Target
• Negative Sentiment: Underlying operating trends remained weak: Revenue declined about 4% year over year to $3.03 billion, adjusted EBIT margin was 6.2%, and non-GAAP EPS fell 20.2% from the prior-year quarter. GAAP diluted EPS was $0.15. DXC Fiscal 2027 Second-Quarter Results
• Negative Sentiment: Management projected a 5% to 5.5% organic revenue decline for FY2027 while evaluating strategic actions, including insurance options. That outlook overshadowed the earnings and revenue beats and is the primary catalyst pressuring the stock. DXC Projects FY2027 Organic Revenue Decline

About DXC Technology

DXC Technology (NYSE: DXC) is a global information technology services and solutions company that helps organizations modernize and manage their technology environments. Its services include consulting, application development and management, cloud migration and operations, cybersecurity, data and analytics, enterprise technology management, and workplace and end-user services.

The company serves businesses and government organizations across a range of industries, including financial services, healthcare, insurance, manufacturing, aerospace and defense, automotive, retail, and the public sector.