Q4 2024 DXC Technology Co Earnings Call Transcript
Key Points
- DXC Technology Co (DXC) achieved a free cash flow of $756 million for the fiscal year, marking the third consecutive year of achieving more than $700 million.
- The company's insurance software and services business grew by 4.5% in the quarter, demonstrating strong momentum.
- DXC Technology Co (DXC) has a high customer retention rate of over 90% and an average customer tenure of 18 years in its insurance business.
- The company is actively working on a restructuring initiative aimed at simplifying and enhancing operational efficiency, which includes consolidating enterprise business systems to reduce operating costs.
- DXC Technology Co (DXC) has reduced total debt levels by $300 million over the full year and plans to further decrease debt levels, including minimizing finance lease originations.
- Total organic revenue declined by 4.9% year-over-year, indicating challenges in revenue growth.
- Adjusted EBIT margin decreased by 50 basis points year-over-year due to lower noncash pension income and the impact of gains from asset sales in the previous fiscal year.
- The company's free cash flow for the quarter was $155 million, below the expected $200 million, due to a smaller benefit from working capital and higher-than-anticipated cash tax levels.
- DXC Technology Co (DXC)'s GIS segment experienced a significant decline, with organic revenue down 9.3% largely due to ongoing challenges in the market and selective approach to new deals.
- The company's full-year guidance anticipates a total organic revenue decline of 4% to 6%, reflecting continued challenges in both the GBS and GIS segments.
Hello, and welcome to the DXC Technology Q4 Earnings Call. (Operator Instructions)
I would now like to turn the conference over to John Sweeney, Vice President, Investor Relations. You may begin.
Thank you, and good afternoon, everybody. I'm pleased that you're joining us for the DXC Technology's Fourth Quarter Fiscal Year 2024 Earnings Call. Our speakers on the call today will be Raul Fernandez, President and CEO; and Rob Del Bene, our EVP and CFO. The call is being webcast at DXC Investor Relations website, and the webcast includes slides that will accompany this discussion today.
Today's presentation includes certain non-GAAP financial measures, which we believe provide useful information to our investors. In accordance with SEC rules, we provide a reconciliation of these measures to their respective and most directly comparable GAAP measures. These reconciliations can be found in the tables included in today's earnings release and in the webcast slides.
Certain comments we make on
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