KD Stock Sinks 55% To Over 3-Year Lows – What Triggered This Selloff?

The company announced the departure of its CFO, delays in certain regulatory filings, and a lowered fiscal 2026 outlook.

• Kyndryl Holdings stated that its audit committee is reviewing cash management, disclosures, and internal financial controls, following voluntary document requests from the SEC.
• The firm expects to report material weaknesses in internal financial controls for the upcoming quarter, fiscal 2025, and the first two quarters of fiscal 2026.
• It expects fiscal 2026 adjusted pretax income between $575 million and $600 million, below an earlier guidance of at least $725 million.

Kyndryl Holdings Inc (KD) stock plummeted 55% on Monday to its lowest level in over three years, after the company reported a series of updates, including the departure of its CFO and delays in certain regulatory filings, alongside a lowered financial guidance for fiscal 2026.

Trading in the stock was halted twice after the opening bell.

CFO Departs Amid Audit Committee Review

Kyndryl said David Wyshner has stepped down as CFO and Edward Sebold has left his role as general counsel, both effective immediately. Wyshner has been replaced by Harsh Chugh, who has been named as interim CFO. Mark Ringes has been named Interim General Counsel.

In a separate release, the company said that its Audit Committee is reviewing cash management, disclosures, and internal financial controls, following voluntary document requests from the Division of Enforcement of the Securities and Exchange Commission (SEC). As a result, Kyndryl said it needs more time to complete its evaluation, which will delay the filing of its Form 10-Q.

Kyndryl said it expects to report material weaknesses in its internal control over financial reporting in the upcoming quarterly report, as well as for fiscal year 2025 and the first two quarters of fiscal 2026.

Kyndryl Cuts FY2026 Earnings Guidance

Kyndryl expects fiscal 2026 adjusted pretax income between $575 million and $600 million, significantly below its previous guidance of at least $725 million. The company also cut its earnings before interest, tax, depreciation, and amortization (EBITDA) margin to 17.5% from 18%. The company now expects a 2% to 3% decline in constant-currency revenue, compared to 1% growth it had forecast earlier.

While third-quarter (Q3) revenue came in at $3.86 billion, marginally below Wall Street’s $3.89 billion estimate, according to Fiscal.ai data, its earnings of $0.25 per share were less than half the Street's $0.67 per share estimate.

Oppenheimer downgraded Kyndryl to “Perform” from “Outperform” and removed its prior price target, according to The Fly. Analyst Ian Zaffino added that Wyshner’s departure creates uncertainty.

How Did Stocktwits Users React?

Despite the intraday slump, retail sentiment on Stocktwits turned ‘extremely bullish’ from ‘neutral’ a day earlier, amid ‘extremely high’ message volumes. KD was among the top trending tickers at the time of writing.

One user noted the company’s positive cash flow and called the selloff a “huge overreaction.”

The stock has shed more than 60% of its value so far in 2026. 

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