Does DXC’s AI Orchestration and Banking Partnership Shift the Investment Narrative for DXC Technology (DXC)?

• DXC Technology recently unveiled Xponential, an AI orchestration blueprint designed to streamline secure, large-scale AI adoption for enterprise clients, alongside a newly announced partnership with Splitit that brings installment payment capabilities to over 40 major banks via DXC’s Hogan core banking platform.
• This dual-pronged approach not only extends DXC’s influence in digital transformation across both AI and banking sectors, but also aims to address historical frictions that have prevented banks from effectively competing with dedicated Buy Now, Pay Later providers.
• We'll explore how DXC’s turnkey AI platform and banking partnership could alter its investment story and sector positioning.

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DXC Technology Investment Narrative Recap

To own DXC Technology, an investor must believe the company can reverse its organic revenue decline and execute on digital transformation despite competitive, industry, and operational headwinds. The recent announcement of its Splitit partnership and Xponential AI offering brings fresh relevance to one short-term catalyst: translating new digital capabilities and partnerships into meaningful top-line improvement. These initiatives, however, do not materially change the key near-term risk, which remains ongoing declines in revenue and margin pressure.

Among recent developments, the Splitit collaboration stands out, equipping banks running DXC’s Hogan platform with on-demand installment payment tools and access to payments innovation previously dominated by fintechs. This move aligns with the need for legacy outsourcing firms like DXC to offset structural revenue declines in their Global Infrastructure Services segment by capturing new digital growth opportunities, offering a tangible test for the company’s modernization strategy and execution capabilities.

Yet, despite these advances, investors should not ignore that persistent revenue declines remain a critical watchpoint, especially if ...

Read the full narrative on DXC Technology (it's free!)

DXC Technology's outlook points to $12.1 billion in revenue and $208.6 million in earnings by 2028. This reflects a 1.7% annual decline in revenue and a $170.4 million decrease in earnings from the current $379.0 million.

Uncover how DXC Technology's forecasts yield a $15.12 fair value, a 13% upside to its current price.

Exploring Other Perspectives

Six members of the Simply Wall St Community estimate DXC’s fair value anywhere from US$8.06 to an eye-popping US$261.89 per share. While this underscores how widely opinions differ, the most pressing company challenge remains ongoing organic revenue decline, which continues to influence near-term performance and sentiment, explore several viewpoints to sharpen your own assessment.

Explore 6 other fair value estimates on DXC Technology - why the stock might be worth 40% less than the current price!

Build Your Own DXC Technology Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your DXC Technology research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free DXC Technology research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate DXC Technology's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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