DXC Technology reported a mixed Q2 FY2026 with a revenue shortfall relative to plan but meaningful progress on profitability and free cash flow. Total revenue was $3.161 billion, a year-over-year organic decline of 4.2%, while the adjusted EBIT margin stood at 8% and non-GAAP EPS reached $0.84, underscoring disciplined cost management amidst top-line pressure. Free cash flow generation was robust, with $240 million in the quarter and $337 million in the first half of the year, driving a stronger balance sheet and operational flexibility. Management reaffirmed a two-track strategy—Core (existing offerings accelerated to their full potential) and Fast Track (AI-native/SaaS solutions targeting rapid, repeatable deployments). The firm is embedding AI across its portfolio (CoreIgnite, OASIS, Xponential) and expanding its SaaS footprint (from 30 to 45 products) with a goal of Fast Track representing 10% of revenue within 36 months. The revenue outlook remains conservative near-term, with FY2026 guidance for revenue of $12.67-$12.81 billion, organic decline of 3.5%-4.5%, and adjusted EBIT margin of 7%-8%, alongside non-GAAP EPS of $2.85-$3.35 and up to $650 million in free cash flow. The market is watching for meaningful bookings conversion and faster SAP/GIS pipeline realization, but DXC projects an improving trajectory into fiscal 2027 as AI-enabled offerings gain momentum. Investors should monitor pipeline conversion, SAP and GIS go-to-market execution, and the cadence of free cash flow generation as catalysts for a re-rated risk-adjusted return profile.