DXC Technology Co

DXC Technology reported second quarter revenues of $3.00 billion, down 5.1% year on year, which was in line with analysts' expectations but accompanied by a significant miss of analysts' EPS estimates. President and CEO Raul Fernandez said the first quarter results were in line with expectations and the company is maintaining its full-year guidance. DXC delivered the slowest revenue growth and weakest full-year guidance update among its peers, and the stock is down 6.6% since reporting, currently trading at $10.50. Among the eight IT services and consulting stocks tracked, Gartner had the best quarter with revenues of $1.68 billion, flat year on year and beating analysts' expectations by 1.8%, while Accenture was the weakest with revenues of $18.72 billion, up 5.6% year on year but with next quarter revenue guidance missing expectations.

DXC Technology reported second-quarter fiscal 2026 revenue of $3.00 billion, in line with analyst estimates, while its non-GAAP earnings per share of $0.40 fell 11.3% below the consensus of $0.45. The company reiterated its full-year revenue guidance of $12.23 billion at the midpoint and its full-year adjusted EPS guidance of $2.65 at the midpoint. Next quarter's revenue guidance of $2.99 billion came in 1.5% below analysts' estimates. Organic revenue declined 6.7% year on year, and the operating margin improved to 6.9% from 3.8% in the same quarter last year. Shares fell 5.2% to $10.66 following the release.

Shares of IT services and consulting firms Gartner and DXC fell in afternoon trading after IBM issued a second-quarter revenue warning that missed Wall Street estimates. IBM pre-announced adjusted earnings of $2.93 per share on $17.2 billion in revenue, below the expected $3.01 and $17.86 billion, with CEO Arvind Krishna citing a sudden reprioritization of enterprise budgets in late June. Clients shifted capital expenditure toward servers, storage, and memory chips to secure supply-constrained hardware, causing numerous large deals to stall. Gartner dropped 3.5% and DXC fell 4.2% as investors treated IBM's delayed deal closures as a bellwether for the broader group. DXC's shares have been highly volatile, with 27 moves greater than 5% over the past year, and are now down 34.1% year-to-date at $9.29 per share.

Zacks Investment Research added three stocks to its Zacks Rank #5 (Strong Sell) List today. Bayerische Motoren Werke Aktiengesellschaft saw its current-year earnings consensus estimate revised 8.2% downward over the last 60 days. DXC Technology Company's estimate was revised 18.2% downward, and Dynavax Technologies Corporation's estimate was revised 50% downward over the same period.

Pomerantz LLP is investigating claims on behalf of investors of DXC Technology Company regarding potential securities fraud or unlawful business practices. The investigation follows DXC's May 7, 2026 financial results, which showed fourth-quarter revenue of approximately $3.13 billion, a 1.2% year-over-year decline and a 6.6% decline on an organic basis, with bookings down 13.5% year over year to approximately $3.3 billion. Management disclosed that the company missed its organic revenue guidance by approximately $75 million, or two percentage points, citing execution issues in addition to pipeline and demand challenges, and issued fiscal year 2027 guidance projecting continued organic revenue decline of approximately 3% to 5% year over year. On this news, DXC's stock price fell $2.58 per share, or 21.48%, to close at $9.43 per share on May 8, 2026.

StockStory identifies Limbach and Tradeweb Markets as profitable stocks worth buying, while recommending investors avoid DXC Technology. Limbach, an integrated building systems solutions provider, posted 12.6% annual revenue growth over the past two years and a 29.1% annual increase in earnings per share, with its free cash flow margin expanding by 7.3 percentage points over five years. Tradeweb Markets, an electronic trading platform operator, achieved 23.4% annual revenue growth and 23.5% annual earnings per share growth over the same period. In contrast, DXC Technology faces a projected 3.6% sales decline over the next 12 months and has struggled with below-average returns on capital. Limbach trades at 17.2 times forward earnings, Tradeweb at 24.3 times, and DXC at 3.4 times.

DXC Technology's stock has dropped 45.6% over the last six months to $8.22 per share, driven by softer quarterly results. The company's organic revenue has averaged a 4.6% year-on-year decline over the past two years, signaling challenges in its core business. Wall Street analysts forecast a further 3.6% revenue drop over the next 12 months, close to the 6.5% annualized declines of the past five years. DXC's five-year average return on invested capital stands at just 2.1%, below the typical cost of capital for business services firms, indicating inefficient growth investments. The stock trades at a forward price-to-earnings ratio of 3.2 times, but its shaky fundamentals suggest significant downside risk.

Gartner reported first-quarter revenues of $1.51 billion, down 1.5% year on year, in line with analysts' expectations and marking a very strong quarter with a beat on EPS estimates. The company, which provides research, advisory services, and conferences, saw Contract Value accelerate and raised its full-year guidance for Adjusted EBITDA excluding divested operations, Adjusted EPS, and free cash flow. Among the eight IT services and consulting stocks tracked, the group's revenues met consensus estimates but next-quarter revenue guidance came in 2.3% below expectations, and share prices have fallen an average of 22% since reporting. IBM outperformed with revenues of $15.92 billion, up 9.5% year on year and beating estimates by 1.3%, while Everforth posted the weakest results with flat revenues of $968.3 million and a disappointing guidance update that sent its stock down 56.3%. DXC Technology reported revenues of $3.13 billion, down 1.2% year on year, and EPAM Systems reported revenues of $1.4 billion, up 7.6% year on year, both in line with expectations but with mixed guidance.

Pomerantz LLP is investigating claims on behalf of investors of DXC Technology Company concerning whether DXC and certain officers and directors engaged in securities fraud or other unlawful business practices. The investigation follows DXC's May 7, 2026, fourth-quarter and full-year fiscal 2026 results, which showed total revenue of approximately $3.13 billion, a 1.2% year-over-year decline and a 6.6% decline on an organic basis, along with fourth-quarter bookings of approximately $3.3 billion, down 13.5% year over year. Management disclosed that the company missed its organic revenue guidance by approximately $75 million, or two percentage points, citing both pipeline and execution issues, and issued fiscal year 2027 guidance projecting continued organic revenue decline of approximately 3% to 5% year over year. On this news, DXC's stock price fell $2.58 per share, or 21.48%, to close at $9.43 per share on May 8, 2026.