DXC Technology (NYSE:DXC) Announces Earnings Results

DXC Technology (NYSE:DXC) announced its earnings results on Thursday. The company reported $0.40 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.42 by ($0.02), FiscalAI reports. DXC Technology had a return on equity of 17.24% and a net margin of 0.14%.The business had revenue of $3 billion for the quarter, compared to analyst estimates of $2.99 billion. During the same quarter in the previous year, the company earned $0.68 EPS. The business’s revenue for the quarter was down 5.0% on a year-over-year basis. 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 Price Performance

Shares of DXC traded down $0.49 during midday trading on Thursday, hitting $11.28. The company’s stock had a trading volume of 5,443,477 shares, compared to its average volume of 3,781,650. The company has a quick ratio of 1.36, a current ratio of 1.36 and a debt-to-equity ratio of 0.94. DXC Technology has a one year low of $7.90 and a one year high of $15.68. The stock has a market capitalization of $1.84 billion, a price-to-earnings ratio of 187.92 and a beta of 0.82. The company’s fifty day simple moving average is $9.40 and its two-hundred day simple moving average is $11.44.

Trending Headlines about DXC Technology

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

• Positive Sentiment: DXC reported $314 million in free cash flow, up from $97 million a year earlier, and repurchased $70 million of stock. First-quarter bookings increased 5% year over year to $3.0 billion, although the book-to-bill ratio was slightly below 1.0x. DXC Technology Reports First Quarter Fiscal Year 2027 Results
• Positive Sentiment: The company announced leadership changes intended to support an AI-centric strategy, naming Paul Taylor president and Dan Gray head of Global Infrastructure Services. DXC also expanded its AI offerings through a strategic partnership with voice-AI company ElevenLabs. DXC Announces Leadership Appointments DXC and ElevenLabs Strategic Partnership
• Neutral Sentiment: First-quarter revenue of approximately $3.0 billion was slightly above analyst expectations of $2.99 billion, while reported EBIT margin was 6.9% and adjusted EBIT margin was 5.0%. Management’s earnings call emphasized the company’s ongoing transformation and AI-focused growth plans. DXC Q1 2027 Earnings Call Transcript
• Negative Sentiment: Non-GAAP EPS was $0.40, below the $0.42 consensus estimate and down 41.2% year over year. Revenue fell 5.1% year over year, or 6.7% organically, while the prior-year quarter produced $0.68 EPS. DXC Lags Q1 Earnings Estimates
• Negative Sentiment: DXC’s second-quarter fiscal 2027 EPS guidance of $0.55 was well below the $0.71 analyst consensus. Revenue guidance of approximately $3.0 billion was in line with expectations, but the weak profit outlook likely drove the negative reaction. DXC Quarterly Earnings Report

Analysts Set New Price Targets

Several equities research analysts recently issued reports on the company. Stifel Nicolaus set a $12.00 price target on DXC Technology in a research note on Friday, May 8th. Zacks Research upgraded DXC Technology from a “strong sell” rating to a “hold” rating in a research note on Monday, July 13th. Royal Bank Of Canada reiterated a “sector perform” rating and set a $16.00 target price on shares of DXC Technology in a research report on Friday, June 12th. TD Cowen decreased their price target on DXC Technology from $11.00 to $10.00 and set a “hold” rating on the stock in a research report on Thursday, July 9th. Finally, BMO Capital Markets dropped their price target on DXC Technology from $17.00 to $10.00 and set a “market perform” rating for the company in a research note on Monday, May 11th. Seven investment analysts have rated the stock with a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of “Reduce” and a consensus target price of $12.25.

Insider Buying and Selling at DXC Technology

In other DXC Technology news, CEO Raul J. Fernandez acquired 28,051 shares of the company’s stock in a transaction that occurred on Monday, May 11th. The stock was acquired at an average cost of $8.90 per share, for a total transaction of $249,653.90. Following the transaction, the chief executive officer directly owned 844,052 shares in the company, valued at $7,512,062.80. This represents a 3.44% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the SEC, which is available through this link. 1.13% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Several institutional investors have recently bought and sold shares of DXC. EverSource Wealth Advisors LLC boosted its stake in shares of DXC Technology by 240.6% in 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 increased its position in DXC Technology by 13,258.8% during the 4th 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 acquired a new position in DXC Technology during the 2nd quarter worth approximately $39,000. Caitlin John LLC lifted its stake in DXC Technology by 358.0% in the 4th quarter. Caitlin John LLC now owns 3,224 shares of the company’s stock valued at $49,000 after purchasing an additional 2,520 shares during the last quarter. Finally, Parallel Advisors LLC lifted its stake in DXC Technology by 36.9% in the 3rd quarter. Parallel Advisors LLC now owns 8,513 shares of the company’s stock valued at $116,000 after purchasing an additional 2,295 shares during the last quarter. Institutional investors and hedge funds own 96.20% of the company’s stock.

DXC Technology Company Profile

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.