Kyndryl (KD) Stock Plummets 53% After Delayed Filing and CFO Departure

TLDR

Table of Contents

Kyndryl (KD) stock tanked 53% to $11.05 after company delayed filing quarterly report over internal control problems
Material weaknesses in financial reporting controls identified across fiscal 2025 and first half of fiscal 2026
CFO David Wyshner and Global Controller Vineet Khurana departed, both replaced with interim executives
Company reduced fiscal 2026 revenue forecast to -2% to -3% year-over-year on constant currency basis
Shares touched 52-week low of $10.82, extending 12-month decline to 46% before Monday’s crash

Kyndryl stock suffered a devastating blow Monday, plunging 53% to $11.05. The IT services company delivered a trifecta of bad news that sent investors running for the exits.

Kyndryl Holdings, Inc., KD

The company announced it would delay filing its December quarter report. Internal control weaknesses over financial reporting forced the postponement.

These aren’t isolated problems. The material weaknesses stretch back through all of fiscal year 2025 and the first two quarters of fiscal 2026.

Kyndryl tried to calm nerves by saying financial statements won’t be affected. The company claims balance sheets, income statements, and cash flows remain accurate.

Wall Street wasn’t buying it.

Financial Leadership Vanishes Overnight

CFO David Wyshner walked out the door effective immediately. His sudden exit raised questions about what’s really happening behind the scenes.

Harsh Chugh took over as interim CFO. He currently serves as global head for corporate development and administration. Previous experience as Chief Operating Officer helps, but investors want permanent leadership.

Global Controller Vineet Khurana also left his position. That’s two top finance executives gone in one announcement.

Bhavna Doegar stepped up as interim corporate controller. She previously held the senior vice president of Finance and Strategy role.

When pressed about whether these exits connected to the accounting problems, Kyndryl refused to comment. The company’s silence only fueled more speculation.

Revenue Outlook Takes Major Hit

Kyndryl released third quarter earnings alongside brutal revised guidance. Fiscal 2026 revenue now expected to fall 2% to 3% on a constant currency basis.

Extended sales cycles drove the downgrade. Deals are taking longer to close across the business.

Kyndryl Consult, one of the company’s fastest-growing segments, saw particularly stretched deal timelines. Legacy IBM contracts from before the spinoff continue creating headwinds.

Oppenheimer analyst Ian Zaffino responded swiftly. He downgraded Kyndryl from Outperform to Perform and removed his price target completely.

The downgrade cited the shift in business dynamics and increased uncertainty from the CFO departure. Extended sales cycles in key growth areas added to concerns.

Shares hit a 52-week low of $10.82 during Monday’s rout. The stock had already fallen 46% over the previous 12 months.

Trading metrics show a P/E ratio of 13.91 and beta of 1.93, reflecting high volatility. Gross margins of 21.4% lag industry peers.

The company now faces extended uncertainty while working through accounting issues and filling two critical finance positions with permanent hires.

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