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- **AI-Driven Growth**: Fast-track AI solutions to contribute 10% of revenue within 3 years, with CoreIgnite and OASIS leading the charge.
- **Mixed Q2 Results**: 4.2% YoY revenue decline offset by 8% EBIT margin, $240M free cash flow, and improving book-to-bill trends.
- **Pipeline Confidence**: Trailing 12-month book-to-bill 1.08, with Q3+ bookings expected to exceed 1.0 as fast-track solutions gain traction.
- **Balance Sheet Strength**: $1.9B cash, $467M remaining under share buyback program, and $650M free cash flow guidance for FY26.
- **Internal AI Efficiency**: 10x productivity gains across functions, enabling focus on high-value client relationships.


**【CEO Summary Section】**
- **Mixed Q2 Performance**: Revenue declined 4.2% YoY organically, but adjusted EBIT margin improved to 8%, driven by cost discipline. Fast-track AI solutions aim to contribute 10% of revenue within 3 years.
- **2-Track Strategy**: Core track focuses on optimizing existing businesses (e.g., SAP, insurance SaaS), while fast track develops AI-native solutions like CoreIgnite (banking platform) and OASIS (AI-powered IT orchestration).
- **AI Integration**: Internal AI adoption (e.g., legal, sales, finance) boosts efficiency by 10x. Xponential framework enables rapid client AI implementation with governance and human oversight.
- **Pipeline Momentum**: Trailing 12-month book-to-bill ratio of 1.08, with confidence in Q3+ bookings to exceed 1.0.

**【CFO Financial Commentary】**
- **Q2 Financials**: Revenue $3.2B (-4.2% YoY), Non-GAAP EPS $0.84 (vs. $0.93 YoY), free cash flow $240M (vs. $48M YoY). Insurance segment grew 3.6% YoY, GIS declined 6.3% YoY.
- **Segment Performance**: CES bookings moderate but trailing 12-month book-to-bill 1.15; GIS bookings growth with long-cycle deals; insurance SaaS revenue to double annually.
- **Guidance Update**: FY26 revenue $12.67B-$12.81B (-3.5% to -4.5% YoY), adjusted EBIT margin 7%-8%, free cash flow $650M (up from $600M prior guidance).
- **Balance Sheet**: $1.9B cash, $4B debt, $125M share buybacks YTD, with $467M remaining under repurchase program.

**【Q&A Highlights】**
- **CES Progress**: New leadership focus on SAP optimization and fast-track AI solutions. Q4 revenue visibility from existing bookings, but pipeline conversion key for growth.
- **GIS Innovation**: OASIS platform to launch mid-2026, targeting IT services growth segments. Pipeline building for new AI-enabled solutions.
- **AI Investment**: Internal AI tools reduce costs and cycle times. Fast-track solutions target high-margin, replicable use cases (e.g., banking, IT management).
- **CoreIgnite Impact**: Converts legacy Hogan banking systems into cloud-native services, enabling banks to launch new revenue streams without disrupting core operations.
- **Cost Management**: Sustained EBIT margin through disciplined spending and AI-driven productivity. No major macroeconomic assumptions in guidance.


DXC Technology Company (DXC) Q2 2026 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

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Cost of Financing Services

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Selling, General and Administrative Expenses

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DXC

DXC fundamentals

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