Kyndryl falls after Gotham City issues new report
** Shares of technology services company Kyndryl Holdings
** Short-seller fund Gotham City Research issues report saying KD manipulates reported adj. EBITDA and adj. free cash flow to artificially give the appearance that it generates profits and cash flow; while in reality, KD generates losses and burns cash
** Says have identified accounting and disclosure irregularities regarding KD's reported 2019-2023 payments to IBM
** "KD reports $1,382 mln as its 6-month, 9-month, and 12-month related party cost of services figure (how much it pays to IBM). We find this highly confusing and suspect," says Gotham City Research
** Says "KD discontinued reporting its IBM costs since 2023, despite the fact that IBM has been Kyndryl's largest supplier"
** "Kyndryl rejects in the strongest possible terms the conclusions reached within the report, which was clearly designed to manipulate the company's stock for the short seller's benefit," Kyndryl spokesperson says
** Shares had risen 66.5% in 2024
KD
fall 11.2% to $30.24
IBM