DXC - DXC Technology: Managing Revenue Decline In Focus On GBS Segment

2024-03-07 11:41:23 ET

Summary

• DXC Technology has faced declining revenue and delayed client engagement, which is currently a common trend in the consulting industry.
• The company is shifting its focus to its Global Business Services [GBS] segment and aims to retain and retrain talent to take advantage of AI and other business transformation consulting opportunities.
• DXC's stock price has fallen significantly compared to the SPDR S&P Software & Services ETF, and management has recently reduced its forward revenue guidance.
• I'm Neutral [Hold] on DXC for the near term on a soft revenue environment.

Investment Outlook

DXC Technology ( DXC ) has suffered from declining revenue from its infrastructure segment and delayed client engagement activity, although these delays are being felt across the consulting industry in the wake of the pandemic's end.

I previously wrote about DXC in December 2023 with a Hold outlook on 'lumpy' bookings amid a soft discretionary project environment....

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