DXC Technology Company

Total revenue was $3 billion, down 6.7% year over year and slightly above the midpoint of guidance. Adjusted EBIT margin was 5.0%, down 180 basis points year over year, and non-GAAP EPS was $0.40, in line with guidance. Bookings increased 5% year over year, with book-to-bill at 0.99x and trailing 12-month book-to-bill slightly above 1.0x. Free cash flow was $314 million, including a $214 million benefit from the TCS litigation; excluding that, free cash flow was $100 million. Cash ended at approximately $1.9 billion, and net debt declined to approximately $1.5 billion. For full-year fiscal 2027, DXC reaffirmed organic revenue decline of 3% to 5%, adjusted EBIT margin of 6% to 7%, and non-GAAP diluted EPS of $2.40 to $2.90, while raising free cash flow guidance to approximately $685 million. For Q2, management guided to organic revenue down 5.5% to 6.5%, adjusted EBIT margin of approximately 6.0%, and non-GAAP diluted EPS of approximately $0.55.

Raul J. Fernandez said DXC is moving from AI strategy to execution and believes agentic AI can reshape how the company builds, sells, and delivers technology. He emphasized a “customer zero” approach, where DXC proves products internally before taking them to market, and highlighted measurable outcomes like reducing intrusion detection time from about 21 minutes to about 6 seconds with AgenTxSOC. His tone was confident and constructive, with repeated emphasis on trust, speed, and using existing customer relationships and IP to return DXC to growth.

Robert F. Del Bene focused on the quarter’s financial performance and the path to second-half improvement. He cited $3 billion of revenue, 5.0% adjusted EBIT margin, $0.40 non-GAAP EPS, $314 million of free cash flow including the litigation benefit, cash of about $1.9 billion, and net debt of about $1.5 billion after buybacks and lease reduction. He said full-year free cash flow guidance is about $685 million, including the TCS litigation benefit and an IRS-related payment, and reiterated capital allocation plans to retire $400 million of USD bonds due in September 2026 and repurchase about $50 million of shares in fiscal 2027.

Analysts pressed on the expected first-half-to-second-half revenue improvement, especially in GIS, and management said most of the improvement comes from GIS, driven largely by opening backlog, with the remainder from modest in-year sales gains. Questions also focused on weak GIS margins despite stronger bookings; management said the main issue was softer discretionary infrastructure work in the quarter and that margins should recover as revenue improves and cost takeout ramps, exiting the year around flat or slightly better versus last year. Analysts asked whether leadership changes and skills development implied problems in the organization; Raul said the shift to an agentic world requires speed, agility, and technically deep talent, and that DXC will retrain, hire, and selectively place people where needed rather than rely on M&A.