IT services provider DXC Technology (NYSE: DXC) will be announcing earnings results tomorrow afternoon. Here’s what you need to know.
DXC missed analysts’ revenue expectations by 0.9% last quarter, reporting revenues of $3.23 billion, down 5.1% year on year. It was a strong quarter for the company, with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.
Is DXC a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting DXC’s revenue to decline 7.3% year on year to $3.14 billion, a further deceleration from the 5.7% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.77 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. DXC has missed Wall Street’s revenue estimates four times over the last two years.
Looking at DXC’s peers in the it services & consulting segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Grid Dynamics delivered year-on-year revenue growth of 25.8%, beating analysts’ expectations by 2%, and IBM reported flat revenue, topping estimates by 1%. Grid Dynamics traded down 3.1% following the results while IBM was also down 6.5%.
Read our full analysis of Grid Dynamics’s results here and IBM’s results here.
There has been positive sentiment among investors in the it services & consulting segment, with share prices up 12.6% on average over the last month. DXC is up 14% during the same time and is heading into earnings with an average analyst price target of $21.33 (compared to the current share price of $16.77).
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