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Sep 30, 2023
Xerox Q3 2023 Earnings Report
Growth in profitability and cash flow was delivered, and Reinvention was announced to drive sustainable profit improvement and revenue growth.
Key Takeaways
Xerox Holdings Corporation announced its 2023 third-quarter results, showcasing growth in adjusted profit, EPS, and free cash flow despite a challenging macro backdrop. The company's Reinvention plan aims to reposition the business for sustainable profit improvement and revenue growth through service expansion.
Revenue of $1.65 billion, down 5.7 percent, or 7.4 percent in constant currency.
GAAP net income of $49 million, or $0.28 per share, up $432 million or $2.76 per share, year-over-year, respectively.
Adjusted operating margin of 4.1 percent, up 40 basis points year-over-year.
Free cash flow of $112 million, up $130 million year-over-year.
Forward Guidance
Total Revenue is expected to be flat to down low-single-digits in constant currency for the full-year 2023. Adjusted operating income margin continues to be in the expected range of 5.5% to 6.0% for full-year 2023, due to the successful implementation of ongoing cost efficiency programs and a focus on generating profitable revenue. We also expect free cash flow for full-year 2023 to be at least $600 million.
Positive Outlook
- Momentum in demand for products and services in the Americas, particularly for faster-growing Digital Services.
- Adjusted operating income margin continues to be in the expected range of 5.5% to 6.0% for full-year 2023, due to the successful implementation of ongoing cost efficiency programs
- Focus on generating profitable revenue.
- Free cash flow for full-year 2023 to be at least $600 million.
- Successful implementation of ongoing cost efficiency programs.
Challenges Ahead
- Mild softening of demand in European markets, reflecting weaker macroeconomic conditions.
- Revenue is expected to come in at the lower end of the expected range.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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