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Mar 31, 2023
Xerox Q1 2023 Earnings Report
Xerox's first quarter results demonstrated balanced execution, driving growth in revenue and profitability.
Key Takeaways
Xerox Holdings Corporation reported a revenue of $1.72 billion, up 2.8 percent year-over-year, with GAAP earnings per share (EPS) of $0.43. The company's adjusted operating margin increased to 6.9 percent, and free cash flow reached $70 million.
Revenue increased by 2.8 percent year-over-year, or 5.5 percent in constant currency.
GAAP earnings per share (EPS) increased by $0.81 year-over-year, reaching $0.43.
Adjusted operating margin improved by 710 basis points year-over-year, reaching 6.9 percent.
Free cash flow increased by $20 million year-over-year, reaching $70 million.
Xerox
Xerox
Forward Guidance
Xerox anticipates flat to low-single-digit revenue decline in constant currency, an adjusted operating margin between 5.0% and 5.5%, and at least $500 million in free cash flow for 2023.
Positive Outlook
- Revenue growth: flat to down low-single-digits in constant currency
- Adjusted Operating Margin: 5.0% to 5.5%
- Free cash flow: at least $500 million
- Stable revenue and demand outlook for the full year
- Low-to-mid single digit gross operating cost efficiencies for the year
Challenges Ahead
- Challenging macroeconomic climate
- Isolated pockets of softer installation activity
- Continued economic uncertainty
- Delays in project deployments
- Macro headwinds like higher inflation, labor shortages, and tighter liquidity conditions