The $2B includes consulting, engineering, implementation and managed services tied to AWS, Microsoft and Google Cloud. What is driving it?​

Hyperscaler alliances are now a $2B business

​Martin Schroeter, CEO, on last week’s call:

Recently, we expanded our alliance with AWS to help enterprises adopt and scale agentic AI as they modernize and run mission-critical workloads in the cloud.

We also expanded our work with Microsoft Azure to help customers design, build, and operate cloud architectures that align with evolving data residency and operational requirements.

With each partner, Kyndryl highlights different focus:

• AWS: agentic modernization

• Microsoft: data residency

• Broadcom, Dell, HPE and Red Hat: private and hybrid cloud

The emerging AI GTM model: FDEs + reusable workflows

​We’ve been expanding our consulting skills and capabilities, including investments in forward deploy engineers, human systems architects, and AI innovation labs, where we co-create agentic solutions at scale.

Kyndryl combines embedded technical talent, customer-specific workflow development, reusable agentic IP and ongoing operations — a more defensible scaling model.

​Kyndryl calls the next step “Agentic Modernization services-as-software”.

It also expanded the AWS Strategic Collaboration Agreement including talent development, joint solution engineering and AI specialization. Kyndryl’s AWS org now includes more than 11,000 AWS-certified professionals.

Agentic AI is changing internal service economics

​Kyndryl runs “1,800 or so agents in the infrastructure helping us get to solutions faster, helping us reduce impact events, helping us reduce errors, helping us automate things.”​

Our business model is one that’s paid on outcomes… We get to keep a piece of the savings we can generate as we manage those contracts. — Schroeter

Management connects these automations to ~$1B in cumulative savings since the IBM spin-off.

Enterprise AI demand is shifting from productivity toward growth, but readiness remains the bottleneck

Kyndryl’s own research found that only 23% of business leaders believe their workforce is ready for AI.

While most AI investments were initially justified through productivity gains, customers are increasingly looking beyond efficiency toward growth, towards speed, and toward new business outcomes. — Schroeter

Kyndryl’s 48% hyperscaler growth suggests that enterprise AI demand is creating the strongest pull for partners that can bridge the gap between cloud technology and production deployment, including agentic AI.

Is implementation capacity becoming the real differentiator in hyperscaler alliances?