*NEW RESEARCH* Kyndryl begins its evolution

IBM is in the midst of undertaking a massive transition. The firm’s objective is to create a portfolio focused on AI and hybrid cloud products and services, which is involving a considerable reconstitution of the business. In October 2020, it announced that it would create a new company (“NewCo”) to be spun-off as an independent entity and listed on the stock exchange. “NewCo” was to be the new home for IBM’s managed infrastructure services - which essentially equated to Global Technology Services (including hosting and networks, services management, and infrastructure modernisation) - a business that has struggled with growth for many years.

In November 2021, IBM completed the separation of what is now Kyndryl, a c$19bn business that’s listed on the NYSE. The separation is good for both parties. IBM’s first set of quarterly results since the split show that - not surprisingly - without Kyndryl on the books, its top line is a lot healthier. See IBM exits 2021 “a different company”.

Earlier week, Kyndryl announced its first set of full year results since separating from IBM last year. Annual revenue to end of December 2021 declined 5% (constant currency) to $18.7bn. The company had a pre-tax loss of $1.9bn, which included a goodwill impairment charge ($469m) and transaction-related costs ($627m).

However, as a separate entity, Kyndryl is now free to pursue new partnerships and market opportunities. It can steer investments to support its own specific strategy and reinvigorate staff with new strategic goals and opportunities. Work to evolve the firm has already very much begun as Kyndryl begins it next chapter.

Subscribers to our Foundation Service or TechSectorViews programme can read more in our new report: Kyndryl begins its evolution.

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Posted by HotViews Editor at '08:30' - Tagged: cloud   partnerships   data   infrastructureoperations   digitaltransformation