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DXC Technology (DXC)
NYSE:DXC
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DXC Technology
(NYSE:DXC)
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Rating:62Neutral
Price Target:
$15.50
▲(16.10% Upside)
Action:ReiteratedDate:01/30/26
DXC scores in the low 60s primarily on improved cash generation and stabilizing profitability, supported by a low earnings multiple. Offsetting factors are ongoing top-line declines and cautious near-term guidance/margin pressure, while technical indicators remain weak-to-neutral.
Positive Factors
Cash Flow Generation
Strong cash flow generation indicates effective financial management and provides the company with flexibility to invest in growth opportunities.
AI Strategy
The focus on AI solutions positions DXC to capitalize on growing demand for digital transformation, potentially driving future revenue growth.
Strategic Partnerships
Partnerships with leading tech firms enhance service offerings and market reach, strengthening competitive positioning in the IT services sector.
Negative Factors
Revenue Decline
Persistent revenue decline suggests challenges in maintaining market share and could impact long-term growth prospects if not addressed.
Disappointing Bookings
Lower-than-expected bookings indicate potential difficulties in securing new contracts, which may hinder future revenue growth.
Segment Challenges
Challenges in key segments like CES can affect overall performance, highlighting the need for strategic adjustments to stabilize revenue.
DXC Technology (DXC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.30B
Dividend YieldN/A
Average Volume (3M)2.35M
Price to Earnings (P/E)5.7
Beta (1Y)0.96
Revenue Growth-4.13%
EPS Growth2143.48%
CountryUS
Employees130,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.96
Shares Outstanding169,759,960
10 Day Avg. Volume2,609,149
30 Day Avg. Volume2,346,988
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)0.95
Price to Sales (P/S)0.24
P/FCF Ratio3.75
Enterprise Value/Market Cap2.34
Enterprise Value/Revenue0.42
Enterprise Value/Gross Profit2.15
Enterprise Value/Ebitda2.53
Forecast
1Y Price Target
$15.00Price Target Upside12.36% Upside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)3.19
Revenue Forecast (FY)$12.67B
DXC Technology Business Overview & Revenue Model
Company DescriptionDXC Technology Company, together with its subsidiaries, provides information technology services and solutions primarily in North America, Europe, Asia, and Australia. It operates in two segments, Global Business Services (GBS) and Global Infrastructure Services (GIS). The GBS segment offers a portfolio of analytics services and extensive partner ecosystem that help its customers to gain rapid insights, automate operations, and accelerate their digital transformation journeys; and software engineering, consulting, and data analytics solutions that enable businesses to run and manage their mission-critical functions, transform their operations, and develop new ways of doing business. It also uses various technologies and methods to accelerate the creation, modernization, delivery, and maintenance of secure applications allowing customers to innovate faster while reducing risk, time to market, and total cost of ownership. In addition, this segment offers business process services, which include integration and optimization of front and back office processes, and agile process automation. The GIS segment adapts legacy apps to cloud, migrate the right workloads, and securely manage their multi-cloud environments; and offers security solutions help predict attacks, proactively respond to threats, and ensure compliance, as well as to protect data, applications, and infrastructure. It also provides IT outsourcing services to help customers securely and cost-effectively run mission-critical systems and IT infrastructure. In addition, this segment offers workplace services to fit its customer's employee, business, and IT needs from intelligent collaboration; and modern device management, digital support services, and mobility services. DXC Technology Company is headquartered in Ashburn, Virginia.
How the Company Makes MoneyDXC Technology generates revenue through a combination of service contracts, project-based engagements, and managed services agreements. Its primary revenue streams include consulting services, system integration, application development and management, and infrastructure services. The company benefits from long-term relationships with large enterprise clients, which often lead to recurring revenue through multi-year service agreements. Additionally, DXC has formed strategic partnerships with major technology providers, such as Microsoft, Amazon Web Services, and ServiceNow, enhancing its service offerings and broadening its market reach. The company's ability to adapt to changing technology trends and client needs also plays a significant role in maintaining and growing its revenue base.
DXC Technology Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyDXC Technology Earnings Call Summary
Earnings Call Date:Jan 29, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:May 14, 2026
Earnings Call Sentiment Neutral
The call presented a balanced picture: strong strategic progress on AI, productization (Fast Track), meaningful operational proofs (customer-zero AI deployment, SOC metrics), improved bookings momentum and solid cash generation and balance-sheet actions. However, these positives are offset in the near term by continuing revenue declines across segments (total revenue -4.3% YoY; GIS -6.2%; CES -3.6%), guidance for further organic decline in Q4, and margin pressure driven by investments and short-term booking delays. Execution risk — including the need to scale product teams and global sales enablement — is a key determinant of whether the strategic initiatives will translate into sustained top-line recovery.Q3-2026 Updates
Positive Updates
AI-First Strategic Shift and Fast Track Initiative
Launched Fast Track AI-infused offerings focused on repeatable IP and productized solutions with a target to reach 10% of run-rate revenue by end of Q2 FY2029; architecture enables moving from idea to production in weeks and preserves legacy systems by layering AI rather than ripping and replacing.
Customer Zero AI Deployment and Operational Scale
DXC deployed AI across the company (115,000 employees), integrating every major AI provider and routing work to the best model; this internal scale is being used as proof-points for productization and GTM.
Demonstrated Security Capability
Agentic security operations center protects DXC from ~4.5 million threats daily with over 90% of alerts resolved automatically, and the capability is being commercialized for banking, healthcare and government customers.
Hogan / Core Ignite Banking Platform Reach and Partnerships
Hogan processes ~$2.5 trillion in transactions per day across ~300 million accounts; introduced Core Ignite to modernize bank experiences without core replacement and announced partnerships (Ripple, Euronet, Aptys, Splitit) to enable real-time payments and new product flows.
Notable New Logo and GTM Improvements
Won a major master-vendor deal with the London Metropolitan Police to lead enterprise transformation (ERP and resource management modernization); launched refreshed brand and first centralized sales enablement function with early positive third-party adviser feedback about differentiation.
Bookings and Order-Book Momentum
Q3 book-to-bill improved to 1.12 with trailing 12-month book-to-bill at 1.02 (fourth consecutive quarter >1); CES book-to-bill 1.20 (trailing 12-month 1.13) and GIS quarterly book-to-bill 1.09, indicating improved booking activity and pipeline strength.
Solid Cash Generation and Strengthened Balance Sheet
Generated $266 million in free cash flow in Q3 and $603 million YTD (up from $576M prior year), on pace for FY guide of ~$650M; cash balance increased to ~$1.7 billion, total debt declined ~$465 million to ~$3.6 billion, and net debt reduced by ~ $970 million.
Shareholder Returns and Liability Reduction
Year-to-date share repurchases totaled $190 million (including $65M in Q3) with planned FY repurchases of ~$250M; prepaid $300M of a $700M bond due in September and paid down $47M of capital lease in the quarter (>$450M capital lease reduction since FY2025).
Profitability Metrics Came In Slightly Ahead
Adjusted EBIT margin in Q3 was 8.2%, slightly above the high end of guidance; non-GAAP EPS $0.96, up from $0.92 year-over-year, helped by lower share count, net interest and tax dynamics.
Negative Updates
Revenue Decline — Total Company
Total revenue for Q3 was $3.2 billion, declining 4.3% year-over-year; updated full-year FY2026 organic revenue decline expected at approximately 4.3% with Q4 organic revenue guide of -4% to -5%.
Segment Revenue Pressure — GIS and CES
GIS (50% of revenue) declined 6.2% year-over-year in Q3 (in line with full-year expectations); CES (40% of revenue) declined 3.6% year-over-year, reflecting continued pressure on short-term discretionary engagements despite strength in longer-term bookings.
U.S. Market Deceleration and Short-Term Booking Delays
The U.S. showed declining performance while rest-of-world improved; short-term project bookings were below expectations, causing delays in revenue recognition and pushing some expected Q3 wins into Q4 (and some Q4 bookings into later periods).
Margin Impact from Investments
Adjusted EBIT margin declined ~70 basis points year-over-year (Q3 at 8.2%) primarily due to planned higher investment levels in offering development and marketing to support future growth; Q4 margin guidance is lower (6.5%–7.5%).
Insurance BPS Delays and Mixed Insurance Performance
Insurance (10% of revenue) grew 3.2% YoY driven by software, but a couple of large BPS opportunities were delayed from Q3 into Q4, negatively impacting near-term revenue in that subsegment and leaving BPS largely flat.
Reliance on Execution and Talent to Scale Fast Track
Management noted the key constraint for Fast Track growth is the availability of product teams that can execute; scaling the new sales enablement and consistent execution across a large global sales organization will take time and discipline.
Company Guidance
DXC's guidance for Q4 FY2026 calls for organic revenue down 4–5% (updated FY26 organic decline ~4.3%), with CES down low-single-digits, GIS down mid-single-digits and Insurance up low-single-digits; adjusted EBIT margin of 6.5–7.5% for Q4 (FY26 ~7.5%), non‑GAAP diluted EPS $0.65–$0.75 (FY26 ~ $3.15), and full‑year free cash flow roughly $650 million. The company noted Q3 metrics of $3.2B revenue (‑4.3% YoY), adjusted EBIT margin 8.2% (‑70 bps YoY), non‑GAAP EPS $0.96, Q3 book‑to‑bill 1.12 (TTM 1.02), CES book‑to‑bill 1.2 (TTM 1.13), GIS book‑to‑bill 1.09, CES = 40% of revenue (‑3.6% YoY), GIS = 50% (‑6.2% YoY), Insurance = 10% (+3.2% YoY). Cash/capital actions include Q3 FCF $266M and YTD $603M (on pace for ~$650M), cash ~$1.7B, total debt ~ $3.6B (down $465M), net debt reduced ~ $970M, YTD buybacks $190M (including $65M in Q3) with $60M planned in Q4 (FY repurchases ~ $250M), and H1 FY27 plans to retire $400M of bonds and repurchase $250M of stock; management also targets Fast Track offerings to reach ~10% of run‑rate revenue by end of Q2 FY2029.DXC Technology Financial Statement Overview
Summary
Financials show stabilization with clear cash-flow strength: free cash flow rebounded strongly (TTM +38%) with solid cash conversion. Profitability has improved to a positive TTM net margin (2.93%) and better EBIT/EBITDA margins, but multi-year revenue contraction (TTM growth -8.31%) and still-meaningful leverage temper the score.Income Statement
DXC Technology's income statement shows a mixed performance. The company has experienced a decline in revenue over the past few years, with a TTM revenue growth rate of -8.31%. Gross profit margins have decreased, indicating pressure on cost management. However, the company has managed to maintain a positive net profit margin of 2.93% in the TTM, recovering from previous losses. The EBIT and EBITDA margins have also shown improvement, suggesting better operational efficiency.55
Neutral
Balance Sheet
The balance sheet reflects a moderate financial position. The debt-to-equity ratio has improved to 0.76 in the TTM, indicating a reduction in leverage. Return on equity remains stable at around 12%, which is a positive sign of profitability. However, the equity ratio is relatively low, suggesting a higher reliance on debt financing. Overall, the balance sheet shows signs of stabilization but still carries some risk due to debt levels.60
Neutral
Cash Flow
Cash flow analysis reveals a strong recovery in free cash flow, with a growth rate of 38% in the TTM. The operating cash flow to net income ratio is healthy, indicating good cash generation relative to earnings. The free cash flow to net income ratio is also strong at 69.42%, reflecting efficient cash management. These metrics suggest that the company is effectively converting its earnings into cash, which is a positive indicator for financial health.70
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 12.68B | 12.87B | 13.67B | 14.43B | 16.27B | 16.27B |
| Gross Profit | 2.50B | 3.10B | 3.09B | 3.18B | 3.58B | 3.58B |
| EBITDA | 2.13B | 2.21B | 1.84B | 866.00M | 3.09B | 3.09B |
| Net Income | 423.00M | 389.00M | 91.00M | -568.00M | 718.00M | 718.00M |
Balance Sheet | ||||||
| Total Assets | 13.18B | 13.21B | 13.87B | 15.85B | 20.14B | 20.14B |
| Cash, Cash Equivalents and Short-Term Investments | 1.73B | 1.80B | 1.22B | 1.86B | 2.67B | 2.67B |
| Total Debt | 4.79B | 4.55B | 4.87B | 5.37B | 6.17B | 6.17B |
| Total Liabilities | 9.76B | 9.71B | 10.80B | 12.03B | 14.76B | 14.76B |
| Stockholders Equity | 3.15B | 3.23B | 2.81B | 3.50B | 5.05B | 5.05B |
Cash Flow | ||||||
| Free Cash Flow | 1.10B | 822.00M | 954.00M | 1.15B | 1.25B | -137.00M |
| Operating Cash Flow | 1.32B | 1.40B | 1.36B | 1.42B | 1.50B | 124.00M |
| Investing Cash Flow | -534.00M | -512.00M | -491.00M | -635.00M | -60.00M | 4.67B |
| Financing Cash Flow | -734.00M | -317.00M | -1.49B | -1.51B | -1.82B | -5.48B |
DXC Technology Technical Analysis
Negative
13.35
Price Trends
14.65
Negative
13.98
Negative
14.33
Negative
Market Momentum
-0.35
Positive
42.23
Neutral
26.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DXC, the sentiment is Negative. The current price of 13.35 is below the 20-day moving average (MA) of 14.14, below the 50-day MA of 14.65, and below the 200-day MA of 14.33, indicating a bearish trend. The MACD of -0.35 indicates Positive momentum. The RSI at 42.23 is Neutral, neither overbought nor oversold. The STOCH value of 26.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DXC.
DXC Technology Risk Analysis
DXC Technology disclosed 38 risk factors in its most recent earnings report. DXC Technology reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
DXC Technology Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $61.18B | 19.39 | 32.85% | 2.58% | 4.62% | 1.06% | |
73 Outperform | $6.76B | 12.52 | 22.37% | 1.41% | 7.40% | -14.45% | |
71 Outperform | $31.95B | 14.65 | 15.16% | 1.46% | 7.44% | -4.57% | |
68 Neutral | $9.26B | 20.67 | 10.34% | ― | 14.26% | -15.49% | |
62 Neutral | $2.30B | 5.74 | 13.79% | ― | -4.13% | 2143.48% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
53 Neutral | $2.96B | 12.19 | 21.77% | ― | -1.90% | ― |
* Technology Sector Average
DXC
DXC Technology
13.35
-5.96
-30.86%
CTSH
Cognizant
65.03
-18.04
-21.71%
EPAM
Epam Systems
138.85
-68.53
-33.05%
G
Genpact
38.93
-12.79
-24.73%
INFY
Infosys
14.65
-5.67
-27.90%
KD
Kyndryl Holdings Incorporation
12.51
-24.64
-66.33%
DXC Technology Corporate Events
Business Operations and StrategyDelistings and Listing ChangesPrivate Placements and Financing
DXC Technology Announces Senior Notes Redemptions
Neutral
Dec 9, 2025
On December 9, 2025, DXC Technology announced its plan to fully redeem its €650 million 1.750% Senior Notes due January 2026 and partially redeem $300 million of its 1.800% Senior Notes due September 2026. The redemptions are scheduled for December 24 and December 19, 2025, respectively, with the Euro Notes set to be delisted from the New York Stock Exchange post-redemption. Concurrently, DXC’s subsidiary completed a €650 million offering of 4.250% Senior Notes due 2030, with proceeds aimed at repaying existing debt and supporting corporate purposes, indicating a strategic move to manage its financial obligations and strengthen its market position.
The most recent analyst rating on (DXC) stock is a Hold with a $14.50 price target. To see the full list of analyst forecasts on DXC Technology stock, see the DXC Stock Forecast page.
Business Operations and StrategyPrivate Placements and Financing
DXC Technology Announces €650M Senior Notes Offering
Neutral
Dec 2, 2025
On December 2, 2025, DXC Technology‘s subsidiary, DXC Capital Funding DAC, announced the pricing of a €650 million offering of 4.250% Senior Notes due 2030. The proceeds from this offering are intended to repay existing indebtedness and support general corporate purposes, with the Notes expected to be listed on the Luxembourg Stock Exchange. This financial maneuver is part of DXC’s strategy to manage its debt and enhance its operational flexibility.
The most recent analyst rating on (DXC) stock is a Hold with a $13.00 price target. To see the full list of analyst forecasts on DXC Technology stock, see the DXC Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.