DXC Technology Company

What they do

DXC delivers software, services and solutions across managed infrastructure services, application modernization and industry-specific software, supported by approximately 115,000 employees in 60 countries. It operates through three reportable segments — Consulting & Engineering Services (CES), Global Infrastructure Services (GIS) and Insurance Software & Services — serving a client base that includes many Fortune 500 companies. The company was formed on April 1, 2017 by the merger of CSC and HPES.

Revenue drivers

• Global Infrastructure Services (GIS) — Largest segment at $6,342 million of fiscal 2026 revenue (about half of total), providing design, migration and management of data center, mainframe, cloud and network environments plus cross-industry business process services for finance, HR, procurement and customer service.
• Consulting & Engineering Services (CES) — Second-largest segment at $5,023 million of fiscal 2026 revenue, providing software engineering, consulting and custom/enterprise applications work with strength in finance, automotive, manufacturing, healthcare, life sciences, travel and the public sector.
• Insurance Software & Services — Smallest segment at $1,279 million of fiscal 2026 revenue, providing software and business process services to Life and Wealth, Property & Casualty and Reinsurance providers modernizing from heritage systems to AI-powered solutions.
• Geography — Fiscal 2026 revenue was split roughly United States 25.4%, United Kingdom 14.7%, and Other Europe 33.6%, with the remainder from Australia and other international markets.

Recent performance

Fiscal 2026 revenue was $12,644 million, down 1.8% year-over-year (down 4.8% organic), with net income attributable to DXC common stockholders of $18 million and diluted EPS of $0.10, versus $389 million and $2.10 in fiscal 2025. Fiscal 2026 operating cash flow was $1,248 million and free cash flow was $713 million. In the first quarter of fiscal 2027, revenue was $2,999 million, down 5.1% year-over-year (down 6.7% organic), diluted EPS was $0.73 and non-GAAP diluted EPS was $0.40, down 41.2%; free cash flow was $314 million including $214 million of TCS litigation proceeds, and the company repurchased $70 million of shares. GIS segment profit fell 60.8% year-over-year to $38 million in the quarter, while CES and Insurance segment profits were $100 million and $34 million.

Strategy

Management is embedding AI, automation and data-driven capabilities into services under a proprietary Xponential framework, with a Core Track to enhance existing offerings and a Fast Track to develop AI-native solutions. Fiscal 2026 results reflect a new three-segment structure (CES, GIS, Insurance) effective April 1, 2025. The company is also reshaping leadership, with Paul Taylor named incoming President and Raul Fernandez serving as President and CEO. Capital return continues via buybacks, with $70 million of shares repurchased in the first quarter of fiscal 2027.

Risks

• Sales execution — The 10-K states that failure to effectively manage and improve the sales organization could make it difficult to acquire new customers or increase sales to existing customers.
• AI adoption and governance — The 10-K cites risks associated with artificial intelligence, including the company's adoption, deployment and governance of AI technologies, as potentially adverse to the business.
• Contract cost estimation — The 10-K warns that inaccurate estimates of service costs or contract completion timelines, or failure by DXC or third parties to meet customer commitments, could hurt contract profitability.
• Cybersecurity and data privacy — The 10-K flags vulnerability to security breaches, cyber-attacks and disclosure of confidential or personal data, plus compliance obligations under privacy and data-handling laws and customer contracts.

Outlook

For full year fiscal 2027, management guides total revenue of $12.10 billion to $12.35 billion, a decline of 3.0% to 5.0% on an organic basis, adjusted EBIT margin of 6.0% to 7.0%, non-GAAP diluted EPS of $2.40 to $2.90, and free cash flow of $685 million (raised from a prior $600 million guide reflecting litigation-related matters). For the second quarter of fiscal 2027, guidance is revenue of $2.97 billion to $3.00 billion, an organic decline of 5.5% to 6.5%, adjusted EBIT margin of 6.0%, and non-GAAP diluted EPS of $0.55. CEO Raul Fernandez said first quarter results were in line with expectations and that the company is maintaining full-year guidance.