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Kyndryl Managed Services, Consulting Assist Customer Sustainability Strategies

May 9, 2024 by Joe Panettieri

Kyndryl, a global MSP (managed IT service provider) and technology consulting firm, continues to accelerate its sustainability efforts internally and across its customer base.

The effort involves Kyndryl Bridge, a managed services platform that has onboarded 1,200 enterprise customers -- 20% more than its initial target -- as of early May 2024.

Kyndryl
Martin Schroeter, CEO, Kyndryl

Kyndryl spun off from IBM in November 2021. Fast forward to 2024, and this is the first year that most of Kyndryl's managed services customers leverage Kyndryl Bridge, CEO Martin Schroeter told Wall Street analysts during an earnings call on May 8, 2024.

That shift to Kyndryl Bridge allows the company to "drive new levels of automation and innovation and it will be another year in which we expect to deliver substantial earnings growth," he added.

Kyndryl Consult and Bridge Managed Services for Sustainability

So where do sustainable IT services fit into the conversation? Kyndryl Bridge can help customers to "understand how they're creating carbon across their footprint," Schroeter said. And the associated Kyndryl Consult services can help customers to "achieve their carbon reduction plans."

Customers certainly need help with those sustainability journeys. Among the anecdotal evidence to note: While 85% of organizations place a high strategic level of importance on achieving their sustainability goals, only 16% have integrated sustainability into their strategies and data, according to research findings from MicrosoftEcosystm and Kyndryl.

With those needs in mind, Kyndryl released its Enterprise Sustainability Design and Implementation service and Kyndryl Sustainability Advisor on Kyndryl Bridge to "optimize performance and lower emissions across customers’ IT estates."

Enabled through Kyndryl Consult, those solutions "provide strategic advice, maturity assessments and roadmaps so customers can deliver on their sustainability objectives as required by the Corporate Sustainability Reporting Directive and global regulations," the company said.

Among the customer wins to note: Start Campus will leverage sustainable water cooling from Nautilus Data Technologies and IT monitoring services from Kyndryl for a massive, sustainable hyperscale data center project in Europe, the companies disclosed in September 2023.

Kyndryl Net Zero Goals, Business Performance

Faith Taylor, Kyndryl
Faith Taylor, senior VP sustainability, ESG and impact officer, Kyndryl

Meanwhile, the MSP marches forward with its own sustainability plan. The company is striving to achieve net zero by 2040. An additional list of nearer-term goals involves various 2030 targets -- including scope 1 and 2 emissions reductions of 75% compared to an estimated fiscal 2023 baseline. Faith Taylor, senior VP sustainability, ESG and impact officer, oversees those carbon reduction initiatives and plenty more.

Amid the MSP platform and sustainability journeys, Kyndryl's overall business is showing multiple signs of progress. To wit, revenue was $3.8 billion in Q4 of 2024, down 10% from Q4 of 2023. And net loss was $45 million -- compared to a $737 million net loss in Q4 of 2023. However: The revenue decline reflects Kyndryl's decision to exit various no-margin and low-margin engagements, the IT service provider said. Wall Street was extremely impressed with Kyndryl's progress, and the company's stock ($KD) jumped nearly 28% amid the May 8, 2024, earnings news.

Giovanni-Carraro
Giovanni Carraro, senior VP, global strategic alliances, Kyndryl

So what's next? Ongoing Kyndryl Bridge enhancements throughout 2024 will continue to address AI-readiness, security compliance, sustainable operations and enterprise modernization, the company vowed in early May 2024.

Also, keep an eye on Giovanni Carraro -- who was promoted recently to senior VP of global strategic alliances. Carraro previously led Kyndryl's partnership buildout with Amazon Web Services (AWS). We'll be watching to see if he inks sustainability-related alliances with various cloud, software and hardware partners.

MSPs, Channel Partners and Sustainable IT Services

In addition to Kyndryl, a small but growing number of MSPs in the United States now offer sustainable IT services to customers. Key examples involve Ensono, LogicalisRackspace, Wheelhouse IT and Worldwide Technology (WWT).

Moreover, global IT consulting firms that have MSP arms continue to expand their sustainability and ESG practices -- despite some ESG pushback from some conservative circles in the United States. Examples in the market include AccentureDeloitteEYKPMGPwC and Capgemini.

A Canalys research report, issued in mid-2023, explains how channel partners are addressing sustainability at differing rates across Europe, North America and other regions.

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