(Reuters) – Kyndryl, an IT services provider, slightly exceeded revenue estimates for the second quarter on Wednesday as businesses engaged in generative AI technology sought its consulting services. The company, which previously operated as IBM’s infrastructure services division, reported a 23% increase in consulting revenue. Kyndryl has gained from firms enhancing their IT systems to meet the extensive data and processing requirements of AI technology. CEO Martin Schroeter informed Reuters, “For every company considering AI and generative AI, the foundation always relies on data. We assist them in developing their data architecture before they even begin to think about Gen AI.” Kyndryl’s revenue for the second quarter decreased by roughly 7% to reach $3.77 billion. The average forecast from four analysts surveyed by LSEG was $3.72 billion. The company took over several low-margin contracts from IBM and has been working to revise them for greater profitability, resulting in an intentional decrease in revenue. According to Schroeter, they expect to resume revenue growth by the end of this fiscal year. Kyndryl aims to achieve $1 billion in revenue in its fiscal year 2025 from what are known as hyperscalers. In the second quarter, Kyndryl reported $260 million in revenue from customers utilizing services from major cloud providers. The company reduced its net loss to $43 million for the quarter that ended in September. 30, in contrast to a net loss of $142 million in the same period last year. When asked about Donald Trump’s election as U.S. president, Schroeter remarked: “I anticipate there will be an ongoing emphasis on the security elements of data and, crucially, on the resilience of the systems that nations depend on.” “Assisting customers in preparing for a regulatory environment will benefit us.” (Reported by Arsheeya Bajwa in Bengaluru; Edited by Anil D’Silva)
