DXC - Earnings call 2 2024 | DXC Technology Company

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Operator

Thank you. Good afternoon, everybody. I'm pleased that you're joining us for DXC Technology's Second Quarter Fiscal Year 2024 Earnings Call.

Our speakers on the call today will be Mike Salvino, Chairman, President and CEO; and Rob Del Bene, our EVP and CFO. The call is being webcast at DXC's 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. SEC and provide measures. most the of to with respective the directly accordance rules, reconciliation we measures In comparable non-GAAP reconciliations the in earnings found can included These today's in the release slides. webcast tables in and be

in discussion Certain uncertainties from forward-looking. statements quarterly comments other the those our and which expressed are be results is actual A risks These could known on we cause Form the of to to on will and XX-Q on filings. uncertainties, SEC make included these call risks subject differ report call. materially and

like our required Technology's Mike? and CEO, on to this I'd like law. And DXC now presented to Chairman, President as except I'd remind DXC by Technology obligation assumes introduce Salvino. no call, information Mike with that the update that, listeners to

Michael Salvino

performance. the an I John, hope will and your and Thanks, Today's on are everyone update begin our you appreciate agenda today, I well. business doing families with and call joining overall

on our Next, in update performance then guidance. up and our before for financial the make closing opening GBS Rob businesses. questions. remarks And I will our some you and detail I results GIS call will discuss will our finally, of

We financial in are performance pleased QX. with our

performance. continues QX team As our consistent above X.X%, offering for on execute QX, minus our operating our strengthen leadership to model. and based was revenue and Organic our with guidance

showed than progress performed business minus minus better QX. expected and to we organic going in from at revenue revenue GIS in GBS X.X% Our QX organic X.X% X.X% growth, of

the book-to-bill X.XX. on $XX was improving. EPS point book-to-bill GBS minus guidance our XX cash was of our the over better our quarter-on-quarter million and was and was which trailing X.XX flow guidance was an improvement which delivered high we QX. is at increase to basis is end due was in margin EBIT $X.XX both X.X%, now GIS XX-month $XX margins Our an million, Free and than

of revenue to of we free The are achieved our compared the are goals margins, global goal model and expanding beginning QX new offering and to running shows operating performance. benefits clearly driving where we growth see X when flow. based all results the QX showed we now execution that cash EPS This with offerings

growth As you several last the financial customer our on is quarters, over DXC consistently management reinforcing and to goals. in That the on from our we with on us right from heard have and have expansion the places work relationships talent to ensuring laser-focused and to our stability moved higher performance. transitioning started foundation right team execute

to that I the absolutely QX, have in our running DXC our moves talented and commitments. Howard, over huge Rob a In Andrew our we deliver that business, been X accountable has our financial significant performance. the impact our senior be critical for team. leadership Howard our executives members us have several play and team in leadership of running run our CFO, Applications alongside with our we team management senior and new for will X the of strategy last ability our roles key parts senior to to months, modern our senior other our will Andrew made who and offering AI operating strengthen is model to consistently financial With and joined offering, Rob making we be driving on obviously, more workplace have based offering be now added experience marked executives place. in believe that expertise

Applications IBM business. the is services him America, offering. them perfect He of an provider. IBM. proven Prior want cloud with customers in we in growth lead from what service IT us Bank expert joined of creating a to with as experience CTO against the strategies at unique is and an has Howard our IT of executing was Howard which did Howard IBM, gives choice perspective to their

of us was to joins industry. I our Most the Andrew the the brands CIO Modern Workplace Workplace customer well-respected them. we makes these services offering. very was P&Ls choice Chief for at Microsoft, and recently, technology he global digital after Modern run to and he perfect services workforce. to at delivered worked in innovative some with the he and Digital a Prior largest Accenture, working provide where Officer deliver for where demanding global to Microsoft, ability His Andrew our to was services the run him the

CXOs to Andrew, industry almost help deep combined relationships attract and XXX revenue. our leading DXC talent us to of targets. the our top who These of Howard Chris, companies, with X on and gives deliver to former XX% financial Fortune X bring and us ITO, runs ability customer

Now revenue. GBS total our turning in grew organically the quarter consecutive accounts to for for GBS tenth business. now and QX XX.X% of our

of strategy. stated growth overall As important have majority DXC, we source high-value and our repeatedly, having this the to consistently revenue business it is become growing

see to we organic As results expand this X are ahead X.X% from quarter our Also, I see offerings. expectations performance growth moderately that growth pleased The the for to on margins all across XX.X% you to due goal. was can delivering XX.X% in stronger in of quarter, us from QX. was the QX revenue the

been new in from benefited has model our model because the the the longest. offering insurance it's Our operating most

positioning insurance for further customers of existing team has software more modernization world's these now to model SaaS His the products, solutions Ray delivers capabilities can focus are customers, offering done efficiently. of industry. Insurance job offering BPS new growth. delivering model, insurance the services insurance our outstanding to we Under selling process a provider of largest & an our the to our and on and our Our Software beginning

our that making solid is DXC just impact I only right of is financial beginning. model is generate example how across right and leader one of This clearly performance. positive production believe and kind starting to approach a

in analytics a yearly GIS basis, we and strategy On is so this selling Another his offerings allowing and customers. FY in our growth in is key 'XX tough million market. to customers, to success having to $XXX a and attribute very of selling GIS generate engineering GBS The XX% growing our operating far. roughly continue revenue new model our team by Michael is our

example having right which Another right billion is model roughly so as Applications the accept FY ready to and GIS growing revenue customer $X.X leader the 'XX offering, selling Howard's but by of is of initial of our this as highest to generates in with the to our far. technology. getting responding not have charged us customers Facing base demand this him and one we AI priorities, it

right in in revenue from it the this X.X% from decline performed business, our X.X% direction, shrinking in now in X GIS moderately GBS, Moving to the while where moved Like to all QX, better QX minus minus our X.X% QX. offerings quarter, increased QX than expectations. to X.X% margin we in in

our quarter Let in continue me highlight fixing have ITO the business. the to made progress we

an discussed have infrastructure-light moving model. to We

year. this our the to plan us business the overall part that more communicated making the us As customers as their initiative on are Executing and the with to to to efficient of this plans is customers a some facilities. to effort us moving that and for margin this move a suboptimized us deal We the customers in sell their the on assets, the deal of helping underutilized have for that using data AWS. forward. We cloud to this to making and ourselves. on-prem cloud. are facilities our GBS improve to of end our center and essential we become economics Rob the to signed move choice and recently This will of to operations sell calls, of cost partner systems fix partnership allow prior on and use are we've selling plan progress Chris on back incentivizes

me call the discuss financials. over to let our the Now turn of details Rob to

Robert Del Bene

Thank you, Mike.

progress offering operating the made with the would this I Before implementation the us to performance and build has execution say model like expect get forward. into I team the improved on based with of going to numbers, good

Adjusted year-to-year basis basis. a EBIT our down came sequentially guidance range margin now line margin reduced at in number, organic points quarter's in points also this and a revenue of XX which low-margin a points points the basis rundown contribution Of came expectations. basis was above increased resale X.X%, year-to-year first came is our in XXX pension with performance. revenues, on basis of XX level Within the range. The in a XX with from of with our and basis. reduction quick year-to-year line provide Organic income XQ our there on decline, was you guidance down revenue significant X.X% which from I'll above was performance. X.X%, a

line benefiting from range, EPS for the the cash down 'XX capital was sequentially. SG&A EBIT pension with So moved high was million, margin in of expectations. non-GAAP year-to-year of our end our our focus guidance income, X.X%. level on lower without the quarter well up from working to and managed a continued and CapEx. in the with Free at $XX quarter $X.XX Non-GAAP $X.XX management X.X% in spending was $X.XX flow XQ our

of trailing guidance. months to half first is quarter, In is is X.XX, now first into and and The through of our similar XX year factored half level the fiscal annual the our of was the book-to-bill the X.XX. X.XX the 'XX bookings the

year. on book-to-bill in the the second forward, to half expect improve our fiscal Looking pipelines, we of based

Moving to our metrics. key financial

basis points was non-cash XX.X% Taking primarily adjusted year-over-year. gross this basis amortization to sequentially, income up SG&A compared was down year-over-year. from by reduction driven our XXX Other margin and quarter million million year-to-year, Depreciation all year. XXX basis initiatives. prior $X in points income. points basis points second million XX benefiting revenues, Our decreased pension the together, a $XX down X.X% and of was year-over-year margin up XX of EBIT decline $XX cost was

in Excluding points pension been about have basis year-to-year. the EBIT margin income would XX both up periods,

EPS reduction to a year, tax due by down lower Net interest short-term $XX on interest share of level repurchase $X.XX $X.XX $X a from due expense to expense driven expense, year-over-year compared to due rate our activity. driven lower partially prior $X.XX decline debt. These Non-GAAP to reduction pension and improvement by ongoing higher by the higher to primarily interest higher income. increased $X.XX count were a was increases share million, offset a a $X.XX variable a million from

to Now turning segment results. our

mix trend business our to Our higher-margin to segment. GBS continues

XX% quarter majority impact by GBS trend of deep margin value revenue. teams. lower consecutive GBS now points with reflects of of profit our posted tenth organically is percentage The the the the shortly, that will GBS be We organic continue and decrease driven As the GBS to declined delivered close growth, the income. this year-over-year, by a will grew revenue, of revenues. which segment the industry-based very X.X% GBS basis pension and anticipate of that total XX the customer

X.X% with basis by the decline declined revenue margin points in again, profit Organic year-over-year, GIS a modest decreased GIS. XX reductions reduction pension to income. Turning of sequentially. driven the

performance Analytics Now a at our below revenue growth let's quarter take first offerings. and closer X.X% the up was rate. look engineering

We are due cautious environment. moderating of seeing as a demand, customers the macroeconomic current are level more to

basis revenue similar performance. points, Applications to declined first quarter XX

performance are in opportunities been Applications book-to-bill see performance second stable, on our the based has in we Applications half business see and the of in we the While to public in sector year banking. expecting improving enterprise our

growth. & Security grow the component BPS up in high year-to-year. EPS portfolio industry SaaS single-digit market. of X.X% insurance and resonating continued of deep platform declined The our is team Software X.X% and skills accelerated Insurance insurance revenue with to to the

performance declined X.X% that continues of primary call, our XQ revenues guide. IT organically. in quarter year-to-year in anticipated Cloud year-to-year the to earnings be first outlined outsourcing X factors which impacted impact The the were infrastructure I by and

were to from declined wind contracts that is down. first continue terminated ago some and The time

decline resale ITO. which in quarter is factor our and in the second of XX% The cloud second drove revenues, decrease

XQ declined business Modern ITO, performed as our expected guide. The in Workplace year-to-year. business with And X% as the

sequential performance second of stabilize in year. through the Our will the this expectation revenue is that half

effort decreased entirely million, to to Turning facility facility increase TSI due our leases $XX rightsize to metrics. $X.X levels with financial of of increased the quarter foundation restructuring part billion. the footprint. in expense to modestly to Debt our the and first Restructuring

continue We restructuring, to tightly evaluate to opportunities and operations. are we'll our managing streamline

Operating commitments. million, down lease related were year-to-year, payments reflecting $XX estate million continued and management our real expenses $XX of

capital year-to-year. million, the million, were $XX In $XX million expenditures lease were Finance down $XXX quarter, flat originations year-to-year.

revenue, of lease and tightly revenues, originations and capital to commitments. of as we capital a our As leasing manage X.X% declined percentage expenditures

$XX million, was cash mentioned $XX I the our slightly half total free As than first earlier, flow quarter for million, year's last better performance. to bringing

related and the higher $XXX suppliers outflows of of payments We to will with fiscal working on be of EBIT the have expenditures first the for combined several significantly free and such software efficiency, bonus maintaining payments, capital continued the cash a as large drivers year are and These million. progress half cash our cash maintenance in renewals annual adjusted we flow taxes. and of of year lower in second goal cash half

second Turning deployment. in year funded repurchase Year-to-date, in repurchased XXXX. fiscal important million just sale and there's $X free share shares we repurchase cash our fiscal to share repurchased outstanding. year that will made the billion of approximately our of aggregate, $X fiscal note, It flow through is 'XX. of half our note for be This to addition our is in capital program. billion the that on in year. to about asset to year program remaining And XX.X% We $XXX continued program progress shares X.X% fiscal XX% DXC the for 'XX and has

quarter. third to now Turning

We the X.X% demand environment. margin of decline $X.XX. to EBIT expect to from revenue of X%, non-GAAP $X.XX diluted weaker organic to to X% minus X% QX Adjusted reflecting EPS minus and

full our to guidance. Turning year

We from reaffirming our to are negative $X.XX. X%, to from to EBIT organic margin our X% EPS of revenue and $X.XX negative X.X% X% adjusted growth

maintaining our free of guidance $XXX million. We are flow also cash

have tax rate. increased We the

a guidance XX%. from rate reflects XX%, up Our of our expectation non-GAAP of tax EPS previous

year We million total realized are making planned in source a cash XQ, asset progress program, our sale 'XX. sale $XX $XX year-to-date is fiscal on bringing asset our million to we of $XXX million. In which

end $XXX of to portfolio expect million fiscal will a execute the the of achieve that to year. have by enable We and objective assets a us

cash-generating These guidance. that more XQ guidance on in into and in could as is factored our we timing, we'll assets specific clarity a transactions loss an non-cash not update have result the and provide

turn With that, final call back his to the Mike thoughts. me let for

Michael Salvino

Thanks, a you Rob, leave takeaways. few and let key with me

to now the financial right intently operating starting sure of focused model see and and we for and for the and continues. on right prove the the have deep most a we our us. running win performance, Applications, X are improvement. offerings to businesses existing new for will make where making We they because impactful ex-CXOs believe our relationships this that benefits X us run CIOs to have global the We the leaders are we model with need ITO Workplace is Having big now Modern

grew flow. the We revenue Concerning expand Quarter-on-quarter, made margins, goal EPS revenue moderately slowed free Our decline on GBS grow for positive for DXC tenth quarter. in and the is progress to and we each. cash straight growth we GIS.

And our continue do We Applications the our Howard also expect to to more. we sell GBS offerings to addition even offering, customers. with GIS driving of

And we revenue, part overall at a of XX.X%. high-value continue business our to make larger GBS our now

in progress EPS flow While turned cash basis expanded as we positive making quarter. the X that delivered points, free revenue, and margin $XX million on we $X.XX

you continue, our financial Expect on updating look quarter. pleased for execution and this with our am progress forward to February. in I execution the will that QX I

the call for Operator, questions. open please up

Operator

line the Bryan comes question Bergin first Our from Instructions] of Cowen. [Operator with

Zachary Ajzenman

Ajzenman Zach on for Bryan. is This

First and the demand outlook. question on

for X, remains was second book-to-bill So but below quarterly the X the quarter. consecutive the above XX-month trailing bookings

to this 'XX, acceleration? gives you So context, XQ looking you And improvement. can some affirmation this stack assumptions which dig confidence revenue underpin for in we're for that give a into revenue just context XQ revenue the layer individual around fiscal implies what perhaps

Michael Salvino

Okay.

was We work accelerated clearly ability talked pipeline number. of factored back saw I is year, revenues. in in takeaway beating by our quarter. the we key Zach, on the you bookings you to first convert tell revenue So when guidance of project last significantly gave of to that from report improved. the the us has guidance year first this half our the the that the the earnings all, our would It's end we about

basically, that we and continue. that we're we we've that's and this need start work. We customers quarter leaders seeing So what starting to detailed shows really think what with operating talked side-by-side, get And project stuff, can to is about the our shoulder-to-shoulder and model last done. is our driving our that

in bookings bookings, what see we lumpy. always been our So have our

now And the year, forward, focused expect are replenishing pipeline, we work. year we're I book-to-bill If our if And at as they the particularly based at of GBS. area before, the you lumpy. on improve, look in on last look look you to project

you're So color for. the that gives hopefully looking you

-- have question do you Next question? another

Zachary Ajzenman

dig are flow, free that being On factors that cash just giving $XXX Yes. I the confidence wanted into here affirmed. million that and to outlook achieve to you able was

Robert Del Bene

Sure, Yes. is Zach. Del Rob Bene. This

in are cash remarks, half the there the I in free of As half. flow second hit first that year repeated won't my mentioned factors that be the in several

And a first payments. of more bonus is are in year. I the detail. the always half skewed you numbers of They could first the the So give rundown to

Our impact due $XXX the was million to in payments. XQ bonus

normally half vendor will primarily and to renewals to range be maintenance that, have those lower year the half the year, annual of of the and significantly our of annual that payments into payments We $XXX the projections first skewed software the first are half SKU for of are in due second million. the the

$XXX So of alone the projected are second as the year those remainder, X factors to better continued we're from in we cash And $XX EBIT come range. the lower million first be will taxes specifically well half half in million. The are we've think second those identified and working make capital And we'll where we being we confident -- have half improvements. improvements. than the

get the to that's the $XXX So bridge million. to pretty detailed

Michael Salvino

much. next so Thanks Zack. question. right, All Jessica,

Operator

comes next of the Gates from Citi. Your with line question Schwarzmann

Gates Schwarzmann

Schwarzmann calling Ashwin. in Gates for is This

bridge. You went through cash the free flow

might that going Is further to the of you noted other like had take precedence. are any share cash Or XXXX. that there main opportunities quarter M&A or also use a repurchased uses You restructuring since that forward? early

Michael Salvino

XA, at allocation, Look, when you we we look XB, basically have capital XC. our --

we've I we be will -- or our made sure XB buyback. that will better. at investment-grade Then stayed the be So our debt, be think XC will XA profile continually investments. is which

quarter, some for outside I If in positioning is in that SG&A offering We've modernizing go made SG&A help some our our business for that's us costs. And third our our investments you to for thing uptick look investments highlighted do of made some growth. we'll of at brand. we've our software this in the also then around you the evaluate insurance terms

I'd question. how that's So answer that

Gates Schwarzmann

follow-up a for question... And

Michael Salvino

Do another you have question?

Gates Schwarzmann

items push versus the one the ask walk thought I offerings has safer I while and the to revenue were better we idea lately, this down cloud track cost some the follow-up. clients we possible than analytics asking what of expected. that we sequential would can prone through were to because like like like nondiscretionary some to have as base record cutting done see Yes, and Applications if get an have IT of it's in out, stepped more thought

Michael Salvino

what would X I So X pieces, the break is GIS. the your look, -- we'll and into GBS question tell you

news it is don't on new the bit. can that's anybody. Applications insurance. thing keeping has been with little I due So and in right to we on but we've lower a be addition a grow, flat. we our a a onto we Engineering to see continuing selling application Analytics he out And seeing now, GBS, A&E, bullish around think GIS are business then rate We tough our that to improve customers. think we're think Michael has believe, pretty that. job final we market. slow GBS And at done But But any continued or is flat. Howard, to to nice definitely

so Just forth. what Ray in market in terms of the and doing is

growth to there. continue we see So

then gave turn with for the of on focused GIS, the success. businesses page some and Andrew you Chris is Chris both ITO. doing to doing positioning are it's what what I details very ITO you with those business And maintain basically, Both today. we'll future we think If that around GIS

happens have, our those assets, with that the he's pushing take put we're them, would the make highlight them I because underutilized So things the we on hang sure So this less again hard Rob being working all facilities can right? and make to that value sell we to year. -- longer that them X they to sure

that, that our The we're being least. for that fair business. into to. us And said, us the about second cloud puts years share now, of thing choice, traditionally, have because cloud pretty to we like of as have we business AWS, as we I AWS, with and that not I happy the the with cloud not gotten and say wanted is partner that clearly participated well operations the migration say

cloud at successfully. And they they're you tidbit And on gives what make to this now, on is focused that and you essential AWS firm they industry easy our make when run, is the is, customer somebody customer partner And they I that we the When stuff right AWS we're expecting business. that work give a has you see and a are of not migration like AWS, to going the deal. big incentivize run they'll see to we that's know that's And with great because is relationships trusted train like see credential, that they're say that essential of and choice happen. operations. ITO I'll can us also that us look systems what us, XX,XXX women our men the when work roughly

that's a bit scale. So quite of

that that's need. we see. what you what gives So you Hopefully,

Operator

from comes with the question next of James Susquehanna. line Friedman Your

James Friedman

per wondering the and Rob, if how the impressive stands it numerator you free share. could cash both achieving especially denominator. the out was and you've some really you're cash flow flow had I on So of because accomplishments unpack And free in that, kind

Robert Del Bene

Yes.

that offerings. -- profitability value teams the of factors have, the with It cash imagine, of contribute the One would offerings performance. the we are delivered as the those there to the there and are flow several several that -- free you starts by

teams on. Another is that reduction significant embarked big contributor a cost activities the have

the year. cost cost goals, with on and that track our goals reduction achieving We're continue. will And successful last reduction were they very year, in this

commitments we've time. outlays commitments steadily management -- on The very And on focused of like longer-term been we and over of both are successful management and third been on leases. the area of in driving that down emphasis capital in has --

wouldn't the say we we had continued has driving then capital. tight. down. numbers there's very those and the But just emphasis if system great been to management not capital opportunities And on working deploy metrics that's Now

are those delivered of So think we has the elements X progress cash free on the what flow. main

Operator

next Your with DeepDives. line comes Rod from of the question Bourgeois

Rod Bourgeois

business and project-based cyclical and updated and they've your Okay. the were I the at affected trends to X the here. demand you how large. revenues guidance, When want talk reported that weak, ago about case months for industry your was

I year. you think some assume half project-based for in to we're the benefits. And new at fiscal some think some of operating time, that revenues I the that your showing would second positioned improvement of that was due model

wanted you due I So see weak to see for revenue you of to project-based the maybe offset are second were have those And do could upside tracking other remain how also challenges? projects there? projects the if sources Do just to cyclical the revenues if to half. share improvement you

Michael Salvino

one So I we're running first. we Rod, Certainly, the I'll an second tackle mean do. business. outsourcing

pipeline right, talk is, about, that's it butter. industry, converting the something frankly, to a you stuff converting taking basically, backlog still your So our that from bit And quite quite bread and in meaning and revenue.

the to why model, right it is you of right went call So I and pipeline and basically model convert with to leaders, it take this can operating all the the we fact right, revenue. reason

we expected. all project a Engineering of the being seeing seeing industry is quickest in better picked than and that But business stuff. doing market, And tougher by insurance, the in the that's is up we're what Now we're terms right? software Analytics

with in say we all see the what has leadership, would applications industry. the Howard's right, that a chance, with I then And --

clients for I implementing right? the comments that he's with clients of ready to mean for that made, he's That doesn't charged AI. need means ready AI. All That AI. getting One get

data, applications. get to your to you for get your ready with got got ready You

data You work good understand your for and to bias and got us. the forth, that's so in

So it's I Howard back could look a better. the potentially half, little we bit think applications at do in flat, but

cloud I'm that AWS margin. the you also with the on the GIS, we with now doing what stuff. with relationship at encouraged business Chris has and When look very how infrastructure he's see positioned

well. in he to where about at knows used our what best basically He stuff, full we I part sell need the did be look, that's Andrew to knows And we have Andrew he the confidence knows he improve. how do because is then And client. what Accenture. and to He

So Do the demand but see GBS, I you when Rod. at going the it have I what another in change is should look demand getting we lumpy, in that question? GIS, better right? much be all demand, that's will don't to see, be

Rod Bourgeois

do. I Yes,

Rob to So challenges, outlining the for I million flow another want that's industry you from target. a cash free drivers flow of the experiencing cyclical That's metric key is angle. get to different year. free about thanks revenues to cash the ask to the Clearly, $XXX kind the this here. clearly project-based impacting and question your

what trying weren't extent position this challenges power cash challenges a demand cyclical impairing cyclical on to in a you are take If free would words, cash seeing then in year? your you project-based revenues to for flow be the I'm this $XXX free your year, north of get flow million? In other

Robert Del Bene

-- is There's I'd on demand. capacity Yes. that I way based we're answer the adjusting mean, our

right? with some more always leverage there's a result. operating leverage revenue, So as There's more demand and always

flow. the the demand of and forward free this and table, the demand for answer the I'd particular, the structure But in see cash is, year, the it in pipelines. higher within we're time, So that our way operating higher going the over our we right, envelope managing on

Michael Salvino

is Rob's the would comments thing keep overlooking So we Rod, to the add model. other I operating

ever quarter, every And also of team than quarter. And transformation year generate it hit seen are produces benefits better last means, the be has to detail X a after of or because this I execution manage a takes what work. right. right, some to most models companies But getting We now to we're free more the starting that see project DXC the our get cash So margins bumps. flow. that operating level it new couldn't these a our is to of only us makes our detail lot have to of not lower ability customers. with more It proud

at see talk we're being catalyst this around point And to me, consistency the you're approach, to leader I performance. when starting able to that's and about market now. financial starting model, right a -- the that team really giving our right to deliver Versus a So time. hitting the having in to

don't on we the where to from have go flow. going and it's forward with we'll free cash more and much there. So where be, We're it happy is

next Jessica, question. So,

Operator

question from Montreal. Instructions] your Clark And next with of comes Brad Bank [Operator

Bradley Clark

part Two question.

flow, to cost see an been and mentioned some much this for as you gradual DXC and to reduction looking economy if get in you've focus? would mean activities left forward a much a and deal How that during how economic a free time room in to focus general. cash do improve, start First, a reduction cycle cost it's

And then than sounds execution-based a mostly It an second part is Workplace. the improvement. on demand-based this rather like Modern is improvement

new execution? and with going with position be does of focus are to play being out? With the is what that take some long to the to business, of And improve it in the leadership sort how

Michael Salvino

Okay.

always levers So on. Brad, cost that first, we're X there's Look, I'll take your point. focused

right? think change will cost facilities, play I all over this rest out we've right, details year. that the fixed will that all of time, drained And focusing us the on our through on

and to contractors solely and margin quarter all the Second reduction due this change, not is revenue the optimize have, us that's was going to to continuing increase to we right? our of staff in the

on is And global the final our X pleased I'll to I the offerings. offshore. now very one running with onshore new was our again, give benefit then model. And operating leaders these execution. that

to continue to on. got up bit. onshore we a one focus that's ticked The little So

haven't need that. there's back look and there, said and at room But we're more go to So done yet. we certainly we

bad, So there, the I or the whether opportunity have is all environment like we right? good

there. environment Workplace, bones in about gone demand make Everybody demand, to Modern there hasn't The On Modern that. back is all time. right? full Let's being offices is Workplace. no

is still great being going big a on piece market, the what's of think virtual and a we've we So in got solution.

So execution able down from expectation quarters. past we few a is, see will an one, that Andrew my standpoint, to you in more get deals weren't knock

Accenture to at with value the thing just we the and market Microsoft, that and what second isn't proposition what employee him do forth, in at he's also he how The the that's to value the good is show know Andrew helping see so look right, That's I that. and do, all stops you'll did is proposition at. expect it's PCs experience. And the maintaining past because going

finally cost there's that we've we on well but do. the think then I piece. think can the Meaning, And more done I is cost,

the X I focused those going think things be he's some he's to and do on, make So would good improvement.

that close. business is think I

So that's why question. we're next leaning it. into Jessica,

Operator

have That's we queue. the in currently all questions the that

Mike So turn at back remarks. this call I point, the over for to will closing

Michael Salvino

joining and so thanks execution. the about today. obviously I are Jessica, pretty everybody call excited We much, appreciate our

some cases, was aligned Our our execution better. in even and expectations with

to my making I on operating model, our that show progress financial is in and think you're see new starting team benefits. the great up

in right As now are our again direction. business we've and moving now the the numbers stabilized

performance from right our means model from the right With consistent think the is catalysts we're time, and nothing financial financial better, on I DXC. leaders get our and which the operating this the on that to to our standpoint I expect model team drive focused but performance continue. performance does

in updating and So with performance a you on our to forward QX nice that, look I evening. have February,

Operator

Ladies and Thank concludes for that joining. call. today's you gentlemen,

disconnect. You may now

DXC Technology (DXC) 1 Nov 232024 Q2 Earnings call transcript