DXC Technology (DXC) Q4 2025 earnings summary

Executive summary

• Q4 bookings rose over 20% year-over-year, with a book-to-bill ratio of 1.22x, marking the second consecutive quarter above 1.0 and a 24% bookings growth rate in the second half.

• Q4 FY25 organic revenue declined 4.2% year-over-year, with adjusted EBIT margin at 7.3% and adjusted EPS at $0.84, down 13.4% year-over-year.

• Leadership stability was reinforced with new equity grants for the CEO and CFO, and 22 new leaders joined the extended leadership team in the past 15 months.

• Operational improvements include stricter sales performance criteria, quota audits, and onboarding a Chief Revenue Officer to drive disciplined execution.

• AI capabilities and offerings have been expanded, with notable wins such as Carnival Cruise Line selecting the company for critical infrastructure management.

Financial highlights

• Q4 revenue was $3.17B, down 6.4% year-over-year (down 4.2% organic); full-year revenue was $12.87B, down 5.8% (down 4.6% organic).

• Adjusted EBIT margin for Q4 was 7.3%, down 110 basis points year-over-year; non-GAAP EPS was $0.84, down from $0.97.

• Full-year non-GAAP diluted EPS was $3.43, up 10.6% year-over-year, driven by lower share count and higher adjusted EBIT.

• Free cash flow for FY25 was $687M, exceeding expectations, with net debt reduced by $785M to $2.1B.

• Q4 GBS revenue was $1.63B, down 4.8% YoY (down 2.4% organic); GIS revenue was $1.54B, down 8.1% YoY (down 6.0% organic).

Outlook and guidance

• FY26 organic revenue expected to decline 3%-5%; adjusted EBIT margin guidance is 7%-8%; non-GAAP diluted EPS expected between $2.75 and $3.25.

• Free cash flow guidance for FY26 is about $600M, with strongest generation in the second half.

• Q1 FY26 organic revenue expected to decline 4%-5.5%, with adjusted EBIT margin of 6%-7% and non-GAAP EPS of $0.55-$0.65.