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DXC (DXC) Q3 earnings report preview: what to look for

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IT services provider DXC Technology (NYSE: DXC) will be announcing earnings results this Thursday after market close. Here’s what you need to know.

DXC met analysts’ revenue expectations last quarter, reporting revenues of $3.00 billion, down 5.1% year on year. It was a slower quarter for the company, with a significant miss of analysts’ EPS estimates.

Is DXC a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting DXC’s revenue to decline 5.2% year on year, a further deceleration from the 2.5% decrease it recorded in the same quarter last year.

DXC total revenue

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. DXC has missed Wall Street’s revenue estimates multiple times over the last two years.

Looking at DXC’s peers in the it services & other tech segment, some have already reported their Q3 results, giving us a hint as to what we can expect. IBM delivered year-on-year revenue growth of 4.7%, beating analysts’ expectations by 1.9%, and Accenture reported revenues up 6.2%, topping estimates by 3.5%. IBM’s stock price was unchanged after the resultswhile Accenture was up 8.5%.

Read our full analysis of IBM’s results here and Accenture’s results here.

There has been positive sentiment among investors in the it services & other tech segment, with share prices up 3.7% on average over the last month. DXC is up 52% during the same time and is heading into earnings with an average analyst price target of $11.21 (compared to the current share price of $15.73).

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