DXC Technology sees Q3 results above estimates on cloud demand

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(Reuters) – IT services company DXC Technology forecast current-quarter revenue and profit above Wall Street estimates on Thursday, powered by steady enterprise spending on its cloud-based solutions amid the AI boom.

DXC projected revenue in the range of $3.2 billion and $3.3 billion for the its fiscal third quarter, compared with analysts’ average estimate of $3.21 billion, according to data compiled by LSEG. 

Companies have been increasingly focusing on bringing AI technologies to their operations, driving demand for cloud computing services which are key to power AI systems. That has lifted demand for DXC’s cloud infrastructure solutions.

DXC provides consulting and engineering services as well as insurance software services as part of its legacy IT outsourcing business, but it has been increasingly focusing on cloud infrastructure to cater to an AI-driven surge in demand. 

It expects an adjusted per-share profit of 75 cents to 80 cents in the third quarter, while analysts estimate earnings of 69 cents per share. 

The company reported revenue of $3.24 billion in the second fiscal quarter ended September, down about 6% from a year earlier, but better than estimates of $3.20 billion, per data compiled by LSEG.

Its adjusted profit of 93 cents per share was ahead of estimates of 72 cents. 

(Reporting by Deborah Sophia in Bengaluru; editing by Alan Barona)