DXC Technology(DXC) - 2025 Q3 - Quarterly Report

Financial Performance - Revenues for the three months ended December 31, 2024, were $3,225 million, a decrease of 5.1$3,399 million for the same period in 2023[10]. - Net income for the nine months ended December 31, 2024, was $133 million, down 52.7$281 million in the same period of 2023[10]. - Basic income per common share for the three months ended December 31, 2024, was $0.31, down from$0.82 in the same period of 2023[10]. - The company reported a comprehensive income attributable to DXC common stockholders of $2 million for the three months ended December 31, 2024, compared to$188 million for the same period in 2023[11]. - The company reported a net income of $125 million for the nine months ended December 31, 2024, compared to$291 million for the same period in the previous year[19]. - Net income attributable to DXC common stockholders for the three months ended December 31, 2024, was $57 million, a decrease of 63.5$156 million for the same period in 2023[28]. - Basic earnings per share (EPS) for the three months ended December 31, 2024, was $0.31, down 62.8$0.82 in the prior year[28]. - Total revenues for the nine months ended December 31, 2024, were $9,702 million, down from$10,281 million for the same period in 2023[86]. - Total revenue for the third quarter of fiscal 2025 was $3.2 billion, a decrease of 5.1$0.31, down from $0.81 in the third quarter of fiscal 2024[112]. - Total revenue growth for the three months ended December 31, 2024, was reported at (5.1)$1,083 million for the nine months ended December 31, 2024, compared to $1,081 million for the same period in 2023[16]. - Cash and cash equivalents increased to$1,723 million as of December 31, 2024, compared to $1,224 million as of March 31, 2024[15]. - The company reported a net increase in cash and cash equivalents of$499 million for the nine months ended December 31, 2024[162]. - Operating cash flow for fiscal 2025 was $1,083 million, resulting in free cash flow of$576 million, compared to $601 million in the same period a year ago[112]. - As of December 31, 2024, total liquidity was$4.9 billion, including $1.7 billion in cash and cash equivalents and$3.2 billion in available borrowings[170]. - The company expects existing cash and cash equivalents, along with cash generated from operations, to be sufficient for normal operating requirements for the next 12 months[168]. Assets and Liabilities - Total current assets decreased to $5,075 million as of December 31, 2024, from$5,135 million as of March 31, 2024[15]. - Total liabilities decreased to $9,781 million as of December 31, 2024, from$10,805 million as of March 31, 2024[15]. - The company’s total equity increased to $3,252 million as of December 31, 2024, from$3,066 million as of March 31, 2024[15]. - The balance of accumulated deficit decreased to $(3,715) million as of December 31, 2024, from$(3,771) million at September 30, 2024[18]. - The estimated fair value of the Company's long-term debt was $3.3 billion as of December 31, 2024, compared to a carrying value of$3.5 billion[58]. - Total debt decreased by $259 million during the first nine months of fiscal 2025, from$4,089 million to $3,830 million[165]. Restructuring and Costs - The company incurred restructuring costs of$124 million for the nine months ended December 31, 2024, compared to $91 million for the same period in 2023[10]. - Restructuring liabilities totaled$45 million as of December 31, 2024, down from $51 million as of March 31, 2024[63]. - Restructuring costs for Q3 FY2025 were$43 million, an increase of $7 million year-over-year, and for the first nine months, they were$124 million, up $33 million[131]. Tax and Compliance - The effective tax rate for the three months ended December 31, 2024, was 51.9$463 million of foreign earnings are considered indefinitely reinvested, which could be subject to U.S. federal tax upon repatriation[68]. - The company recorded a $15 million tax indemnification receivable related to uncertain tax positions and a$99 million tax indemnification payable related to other tax receivables[69]. Share Repurchase and Equity - The company repurchased 11,341 thousand shares during the three months ended December 31, 2023, resulting in a reduction of equity by $255 million[18]. - A total of 32,274,927 shares were repurchased during fiscal 2024 at an average price of$23.11 per share, totaling $746 million[77]. - Approximately$592 million worth of shares remained available for repurchase under the share repurchase plan as of December 31, 2024[184]. - The company suspended payment of quarterly dividends for fiscal 2025 to maintain financial flexibility[171]. Segment Performance - Revenues for the Global Business Services (GBS) segment for the three months ended December 31, 2024, were $1,666 million, a decrease from$1,696 million in the same period of 2023[86]. - Segment profit for GBS for the three months ended December 31, 2024, was $224 million, compared to$202 million for the same period in 2023[86]. - The Global Infrastructure Services (GIS) segment saw revenues of $1,559 million, down 8.5$1.67 billion, a decrease of $30 million or 1.8$4.7 billion, down $487 million or 9.4$286 million for the three months ended December 31, 2024, an increase of 11.7% from $256 million in the same period of 2023[152]. - The company has initiated a global cost savings initiative for fiscal 2025 to align workforce and facility requirements[64]. - The cash conversion cycle improved to 18 days for the three months ended December 31, 2024, compared to 2 days in the previous year[163]. - The company is in compliance with all financial covenants associated with its borrowings as of December 31, 2024[166]. - Credit ratings from Fitch and Moody's are BBB and Baa2, respectively, both with a negative outlook[167].