Kyndryl Holdings, Inc. (KD) SEC Filings & Earnings Calls

Increased leverage and interest expense from new debt

“Issuance of 7.800% and 7.875% senior notes”

Revenue decline; workforce rebalancing charges impacting profitability; free cash flow negative.

“Free cash flow was a use of $401 million in the quarter, compared to a use of $222 million in the prior year” · word for word

Revenue decline and margin pressure

“Revenue down 3.3% YoY; adjusted EBITDA down 19.3% YoY.”

Restructuring execution risk

“Workforce rebalancing charges of $152M in Q2 2026, up from $25M in prior year.”

Negative operating cash flow

“Operating cash flow of -$310M in Q2 2026, compared to -$124M in prior year.”

Potential dilution from increased share plan authorization.

“increased the number of shares... by 7,600,000 shares.”

Executive transition risk; new CFO and GC may bring strategic changes.

“Appointment of new CFO and General Counsel; interim roles succeeded.”

Elongated sales cycles

“This performance reflects an environment with elongated sales cycles that have weighed on our revenue and signings performance.” · word for word

Revenue decline from strategic actions

“the Company’s proactive, strategic actions to reduce certain low-margin revenue streams to strengthen margins and overall profitability in connection with our Accounts initiative have also impacted revenue.” · word for word

Executive turnover

“Effective as of February 5, 2026, the Board appointed Mr. Chugh as Interim Chief Financial Officer of the Company and Mr. Ringes as Interim General Counsel of the Company. Concurrently with the appointments of Messrs. Chugh and Ringes, Mr. Wyshner departed from his position as Chief Financial Officer of the Company, and Mr. Sebold departed from his position ” · word for word

Below-target annual bonus payout

“The results set forth above produced a weighted payout percentage of 69% of target.” · word for word

Material weaknesses in internal control over financial reporting

“As previously disclosed, the Company has identified material weaknesses in its internal control over financial reporting.” · word for word

Ongoing SEC investigation

“We continue to cooperate with the SEC Division of Enforcement’s investigation relating to the Company’s cash management practices, related disclosures, the efficacy of the Company’s internal control over financial reporting, and certain other matters.” · word for word

Excess purchase commitments may lead to future charges

“The Company has determined that these commitments may exceed the Company’s needs over the next two to three years. If the Company is unable to satisfy, reduce or amend its contractual commitments, it will record the future charges for any payments related to excess commitments as cost of services.” · word for word

Execution risk of workforce rebalancing; actual costs and savings may differ.

“The estimate of costs... and savings... are subject to a number of assumptions and actual results may differ.”

Revenue Decline from Low-Margin Contract Reduction

“The revenue decline was largely attributable to actions the Company has taken to reduce low-margin components of its customer relationships, as well as currency effects.” · word for word

Excess Purchase Commitments

“The Company has determined that these commitments may exceed the Company’s needs over the next two to three years. If the Company is unable to satisfy, reduce or amend its contractual commitments, it will record the future charges for any payments related to excess commitments as cost of services.” · word for word

Internal Control Weakness (from 10-Q/A)

“The Company identified the following material weaknesses in its internal control over financial reporting: ... there was a lack of transparency with the Company’s Chief Executive Officer, the Audit Committee of the Board and the Board, such that disclosure processes, including with respect to cash management practices regarding deferring vendor payments quar”

SEC Investigation and Material Weaknesses in Internal Controls

“As previously disclosed, the Company, through the Audit Committee of its Board, is reviewing its cash management practices, related disclosures, the efficacy of the Company's internal control over financial reporting, and certain other matters following the Company's receipt of voluntary document requests from the Division of Enforcement of the SEC relating ” · word for word

Lengthening Sales Cycles

“During the period, growth in Kyndryl Consult and hyperscaler-related revenues were partially offset by lengthening sales cycles.” · word for word

Declining Signings

“Signings decreased by $2.8 billion, or 22%, in the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024” · word for word

Data Sovereignty Regulatory Uncertainty in Europe

“Additionally, revenues were impacted by certain regulatory uncertainties specifically regarding data sovereignty in Europe.”

Liquidity Risk from $1B Revolver Draw

“In February 2026, the Company borrowed $1 billion under the Revolving Credit Agreement. Proceeds are intended to be used for working capital and other general corporate purposes, which may include repayment of indebtedness and acquisitions.” · word for word

Internal Control Weakness

“The Company identified the following material weaknesses in its internal control over financial reporting: ... there was a lack of transparency with the Company’s Chief Executive Officer, the Audit Committee of the Board and the Board, such that disclosure processes, including with respect to cash management practices regarding deferring vendor payments quar” · word for word

Material Weaknesses in Internal Control over Financial Reporting

“The Company identified the following material weaknesses in its internal control over financial reporting: ... The Company's senior finance executives failed to set an appropriate tone at the top based on the principles associated with the control environment component of the COSO framework.” · word for word

SEC Investigation and Potential Legal/Regulatory Actions

“As previously disclosed, the Company, through the Audit Committee of its Board, is reviewing its cash management practices, related disclosures, the efficacy of the Company's internal control over financial reporting, and certain other matters following the Company's receipt of voluntary document requests from the Division of Enforcement of the SEC relating ”

Lack of Transparency with CEO and Board

“Specifically, there was a lack of transparency with the Company's Chief Executive Officer, the Audit Committee of the Board and the Board, such that disclosure processes, including with respect to cash management practices regarding deferring vendor payments quarter to quarter, were impacted.” · word for word

Key executive departures (CFO, General Counsel, Global Controller) may signal organizational disruption or strategic shift.

“Departure of CFO, General Counsel, and Global Controller effective immediately; interim appointments made.”

Leadership changes announced (Interim CFO, General Counsel, Corporate Controller) may create short-term uncertainty.

“Kyndryl today announced that Harsh Chugh has been named Interim Chief Financial Officer, Mark Ringes has been named Interim General Counsel and Bhavna Doegar has been named Interim Corporate Controller effective immediately.” · word for word

Form 10-Q filing delayed pending review, though no restatement expected.

“the filing of Kyndryl’s Quarterly Report on Form 10-Q will be delayed pending the review described in Kyndryl’s Form 12b-25” · word for word

Loss of experienced CHRO, but transition appears orderly.

“Retirement after 4 years as CHRO and 20 years as public-company CHRO.”

Signings Decline

“Signings decreased by $2.8 billion, or 49% in the three months ended September 30, 2025, compared to the prior-year quarter” · word for word

Revenue Decline from Contract Pruning

“United States revenue of $899 million decreased 6 percent compared to the prior-year quarter, driven by the Company’s efforts to reduce certain low-margin revenues” · word for word

Operating Cash Flow Decline

“Net cash provided by operating activities was $22 million in the six months ended September 30, 2025, compared to $101 million in the prior-year period” · word for word

Revenue decline of 1% reported, 3.7% constant currency, due to reduction in low-margin contracts and longer sales cycles

“revenues of $3.7 billion, down 1% year-over-year on a reported basis and down 3.7% in constant currency” · word for word