DXC Technology Co
NYSE:DXC
DXC Technology Co
DXC Technology Co. has carved its niche in the competitive landscape of information technology services by providing mission-critical solutions tailored to the unique needs of businesses across the globe. Emerging from the 2017 merger of CSC and the Enterprise Services business of Hewlett Packard Enterprise, DXC boasts a rich legacy that blends years of expertise with innovative approaches to technology. It positions itself as a formidable ally for companies undergoing digital transformations, offering an array of services that span from cloud computing to data analytics and enterprise applications. The company's business model is driven by its ability to integrate and optimize IT infrastructures, allowing clients to focus on their core operations while DXC navigates them through the complexities of digital landscapes.
The revenue streams of DXC are primarily derived from long-term service contracts, where it leverages its deep industry expertise to drive efficiencies and enhance customer experiences through technological advancements. Its clientele includes major players in sectors like healthcare, banking, manufacturing, and government, each seeking to harness the potential of cutting-edge solutions to stay competitive. DXC’s offerings are not just limited to IT modernization; they extend to workplace and mobility solutions, security, and customized software solutions, ensuring that clients gain comprehensive support. By embracing cloud technologies and automated processes, DXC capitalizes on the growing demand for digital forwardness, turning complex IT challenges into strategic advantages for its partners. Thus, it sustains its profitability by becoming an indispensable part of its clients' journeys toward digital maturity.
DXC Technology Co. has carved its niche in the competitive landscape of information technology services by providing mission-critical solutions tailored to the unique needs of businesses across the globe. Emerging from the 2017 merger of CSC and the Enterprise Services business of Hewlett Packard Enterprise, DXC boasts a rich legacy that blends years of expertise with innovative approaches to technology. It positions itself as a formidable ally for companies undergoing digital transformations, offering an array of services that span from cloud computing to data analytics and enterprise applications. The company's business model is driven by its ability to integrate and optimize IT infrastructures, allowing clients to focus on their core operations while DXC navigates them through the complexities of digital landscapes.
The revenue streams of DXC are primarily derived from long-term service contracts, where it leverages its deep industry expertise to drive efficiencies and enhance customer experiences through technological advancements. Its clientele includes major players in sectors like healthcare, banking, manufacturing, and government, each seeking to harness the potential of cutting-edge solutions to stay competitive. DXC’s offerings are not just limited to IT modernization; they extend to workplace and mobility solutions, security, and customized software solutions, ensuring that clients gain comprehensive support. By embracing cloud technologies and automated processes, DXC capitalizes on the growing demand for digital forwardness, turning complex IT challenges into strategic advantages for its partners. Thus, it sustains its profitability by becoming an indispensable part of its clients' journeys toward digital maturity.
Revenue Decline: DXC reported Q3 revenue of $3.2 billion, down 4.3% year-over-year, within its guidance range.
EPS Outperformance: Non-GAAP EPS was $0.96, above the high end of guidance and up from $0.92 last year, driven by lower share count, net interest expense, and taxes.
Margin Commentary: Adjusted EBIT margin was 8.2%, slightly above guidance but down 70 bps YoY due to planned investments in offerings and marketing.
Bookings & Pipeline: Book-to-bill ratio was 1.12 for the quarter and 1.02 on a trailing 12-month basis, marking a fourth consecutive quarter above 1.
Segment Trends: CES revenue declined 3.6%, GIS declined 6.2%, while Insurance grew 3.2%. Insurance growth stemmed from cloud-based software migration.
AI & Fast Track Initiatives: Management highlighted progress on AI-native Fast Track products, with expectations to reach 10% of run rate revenue by end of Q2 FY 2029.
Free Cash Flow: Q3 free cash flow was $266 million, year-to-date at $603 million, tracking to the full year guide of $650 million.
Capital Allocation: Share repurchases guided to $250 million for the full year, up from $150 million prior, with plans for $250 million more in H1 FY27, and continued debt reduction.
2026 Guidance Affirmed: Full year guidance maintained: ~4.3% revenue decline, ~7.5% adjusted EBIT margin, ~$3.15 EPS, and $650 million free cash flow.
