Kyndryl Blowup: JPMorgan Double Downgrades Stock After ‘Stunning’ CFO Exit, Accounting Review

• Kyndryl stock dropped 55% on Monday following the disclosure, and then slightly more in the after-market session.
• The company, which was part of IBM until 2021, has launched an international review of its accounting practices following an SEC probe.
• Stocktwits sentiment for KD stock flipped to ‘extremely bullish’ from ‘neutral.’

JPMorgan sharply downgraded Kyndryl Holdings stock on Monday, after the IBM spinoff disclosed that it was reviewing its accounting practices following queries from the Securities and Exchange Commission and the departure of its top financial and legal executives.

The investment research firm double-downgraded Kyndryl stock to ‘Underweight’ from ‘Overweight,’ and slashed its price target to $16 from $40, citing the “stunning” CFO change and cut to the company’s 2026 forecast.

What Happened?

On Monday, the IT infrastructure services provider said it will delay filing its October-December results as it launches an internal review of potential weaknesses in its internal controls. 

Separately, Kyndryl announced the departures of its finance chief, David Wyshner; global controller, Vineet Khurana; and General Counsel, Edward Sebold, and interim appointments to the CFO and corporate controller roles.

$3 Billion Shaved Off

That sent Kyndryl stock 55% lower on Monday, the steepest since the company spun off from IBM and began trading independently in October 2021. The stock saw 30 times its average trading volume as the company’s market value fell to $2.4 billion from $5.4 billion.

On Stocktwits, the retail sentiment for JD stock flipped to nearly the highest possible level in the ‘extremely bullish’ zone (99/100) from ‘neutral’ the previous day. The ticker drew over 300 posts on the platform, with many debating whether the developments would lead to a catastrophe or if the extreme stock reaction was a buying opportunity.

“When your CFO & General Counsel resign in protest followed by delayed 10-Q and 10-K filings due to internal control material weakness in the financial statements AND a lowered future annual guidance, there is only one thing to do.” a user posted, with a GIF of Will Smith yelling “Run!!”

Kyndryl Internal Review, Revenue Forecast 

Kyndryl said its audit committee has begun reviewing cash management practices, related disclosures, and internal controls following voluntary document requests from the SEC's enforcement division.

The company also cut its fiscal 2026 outlook for constant-currency revenue to a decline of 2% to 3% from a prior forecast of 1% growth. Kyndryl was IBM's infrastructure services business until its spinoff. 

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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