Kyndryl's Q3 2025 Earnings Call: Unpacking Contradictions in Signings, Consult Growth, and Tariff Impacts

These are the key contradictions discussed in Kyndryl's latest 2025 Q3 earnings call, specifically including: Signings Momentum and Growth, Kyndryl Consult growth and positioning, Acquisition Strategy, and the Impact of Tariffs on IT Budgets:



Strong Financial Performance and Market Growth:
- Kyndryl Holdings reported $4.1 billion in signings for Q3, marking the fifth consecutive quarter of signings growth, with a 31% increase over the last 12 months.
- The growth was fueled by double-digit revenue growth in Kyndryl Consult and demand for modernization, cloud, security, and AI services.

Increased Earnings and Profitability:
- Kyndryl achieved adjusted pretax income of $160 million in Q3, up 154% year-over-year.
- The increase was driven by strong execution on strategic initiatives, specifically the 3As (alliances, accounts, and advanced delivery) initiatives.

Hyperscaler Revenue Growth:
- Hyperscaler-related revenue surpassed $300 million in Q3, tracking ahead of their nearly $1 billion full-year target.
- This growth was supported by strategic alliances and partnerships with major cloud providers, enhancing Kyndryl's service offerings.

Consulting Services Expansion:
- Kyndryl Consult revenues grew 26% year-over-year in Q3, with signings increasing by 35%.
- The increase was driven by a growing demand for higher-value services and Kyndryl's ability to provide multi-vendor solutions that meet customer needs.