Xerox Holdings CorporationNASDAQ: XRX

Q1 Quarterly Results (3e2295)

· Issued by Xerox Holdings Corporation
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Cost of Revenue

Cost of sales

Cost of services, maintenance, rentals and other

Total Cost of Revenue

382

480

788

717

2,367

600

649

645

728

732

2,754

697

1,031

1,125

1,516

1,449

5,121

1,297

Gross Profit

Sales gross profit

Services, maintenance and rentals gross profit

Gross Profit

Research, development & engineering

175

185

205

351

916

320

251

266

240

228

985

229

426

42

451

43

445

74

579

71

1,901

230

549

64

Bad Debt Expense

Selling, administrative and general exp. (Excl Bad Debts)

Total Selling, administrative and general exp.

Non-financing interest expense

Restructuring and related costs

Amortization of intangible assets

Divestitures

Total Costs and Expenses

(1)

10

59

(2)

66

45

10

10

30

33

83

30

(4)

1,524

-

1,636

-

2,261

-

2,089

(4)

7,510

-

1,919

2025

2026

Q1

Q2

Q3

Q4

FY

Q1

Sales

Services, maintenance, rentals and other

Total Revenues

557

665

993

1,068

3,283

920

900

911

968

960

3,739

926

1,457

1,576

1,961

2,028

7,022

1,846

Aggregate Exchange losses

All other, net

Total Other, net

33

-

55

1

80

5

80

6

248

12

84

5

35

24

20

21

100

(36)

35

25

25

27

112

(31)

(67)

(60)

(300)

(61)

(488)

(73)

9

15

9

6

39

5

369

353

468

425

1,615

425

378

368

477

431

1,654

430

Loss before Income Taxes

23

46

460

12

541

32

(90)

(106)

(760)

(73)

(1,029)

(105)

(4)

(3)

(4)

(3)

(14)

(4)

(94)

(109)

(764)

(76)

(1,043)

(109)

Income Taxes

Net Loss

Less: Preferred stock dividends, net

Net Loss attributable to Common Shareholders

Preferred Dividends/ - Basic

Other - Diluted **

2025

2026

Q1

Q2

Q3

Q4

FY

Q1

4

3

4

3

14

4

4

3

4

3

14

4

- Basic

- Diluted **

125

126

127

128

126

129

125

126

127

128

126

129

(0.75)

(0.87)

(6.01)

(0.60)

(8.25)

(0.84)

(0.75)

(0.87)

(6.01)

(0.60)

(8.25)

(0.84)

Weighted Average Shares Loss Per Share Key Ratios - GAAP: Gross Margins

SAG as a % of Revenue

Tax Rate

Ending Xerox Employment

Total Basic Loss per Share Total Diluted Loss per Share

- Sales

31.4%

27.8%

20.6%

32.9%

27.9%

34.8%

- Services/Maintenance/Rentals/Other

27.9%

29.2%

24.8%

23.8%

26.3%

24.7%

- Total

29.2%

28.6%

22.7%

28.6%

27.1%

29.7%

25.9%

23.4%

24.3%

21.3%

23.6%

23.3%

-34.3%

-76.7%

-153.3%

-19.7%

-110.9%

-43.8%

16,800

16,600

26,300

24,600

24,600

22,900

**For those periods that exclude the preferred stock dividend the average shares for the calculations of diluted EPS include 7 million shares associated with our Series A or Series B convertible preferred stock.

Non-GAAP basis is adjusted to exclude restructuring and related costs, amortization of intangible assets, non-service retirement-related costs as well as other discrete, unusual or infrequent items as described in our Non-GAAP Financial Measures section of our Quarterly Reports on Form 10-Q and our Annual Report on Form 10-K

2025

2026

Q1

Q2

Q3

Q4

FY

Q1

(in $ millions, except per-share data)

Revenues

Sales

Services, maintenance, rentals and other

Total Revenues

557

665

993

1,068

3,283

920

900

911

968

960

3,739

926

1,457

1,576

1,961

2,028

7,022

1,846

Cost of Revenue

Cost of sales

Cost of services, maintenance, rentals and other

Total Cost of Revenue

377

474

679

711

2,241

595

647

641

716

725

2,729

691

1,024

1,115

1,395

1,436

4,970

1,286

Gross Profit

Sales gross profit

Services, maintenance and rentals gross profit

Gross Profit

180

191

314

357

1,042

325

253

270

252

235

1,010

235

433

461

566

592

2,052

560

Bad Debt Expense

Selling, administrative and general exp. (Excl Bad Debts)

Total Selling, administrative and general exp.

9

15

9

6

39

5

360

344

418

415

1,537

419

369

359

427

421

1,576

424

Research, development & engineering 42 43 74 69 228 64

Aggregate Exchange losses

All other, net

Total Other, net

-

1

5

6

12

5

(1)

(15)

-

(1)

(17)

(1)

(1)

(14)

5

5

(5)

4

Non-financing interest expense 33 55 80 80 248 84

1,467

1,558

1,981

2,011

7,017

1,862

Total Costs and Expenses

(10)

18

(20)

17

5

(16)

(Loss) Income before Income Taxes

(6)

95

(47)

25

67

35

Income Taxes

(4)

(77)

27

(8)

(62)

(51)

Net (Loss) Income

(Loss) Earnings Per Share

Operations:

Preferred Dividends - Adjusted EPS **

Adjusted (Loss) Earnings per Share

Adjusted Weighted Average Shares **

(0.06)

(0.64)

0.20

(0.10)

(0.60)

(0.43)

-

-

-

-

-

-

(0.06)

(0.64)

0.20

(0.10)

(0.60)

(0.43)

125

126

129

128

126

129

Non-GAAP basis is adjusted to exclude restructuring and related costs, amortization of intangible assets, non-service retirement-related costs as well as other discrete, unusual or infrequent items as described in our Non-GAAP Financial Measures section of our Quarterly Reports on Form 10-Q and our Annual Report on Form 10-K

2025

2026

Q1

Q2

Q3

Q4

FY

Q1

(in $ millions, except per-share data)

- Sales

- Services/Maintenance/Rentals/Other

- Total

32.3%

28.7%

31.6%

33.4%

31.7%

35.3%

28.1%

29.6%

26.0%

24.5%

27.0%

25.4%

29.7%

29.3%

28.9%

29.2%

29.2%

30.3%

Key Ratios - Adjusted: Gross Margins

1.5%

3.7%

3.3%

5.0%

3.5%

3.9%

Adjusted Operating Margin

SAG as a % of Revenue

Adjusted Effective Tax Rate

25.3%

22.8%

21.8%

20.8%

22.4%

23.0%

60.0%

527.8%

235.0%

147.1%

1340.0%

-218.8%

Non-GAAP Adjustments:

Restructuring and related costs

(1)

10

59

(2)

66

45

Amortization of intangible assets

10

10

30

33

83

30

Non-service retirement-related costs

18

19

20

21

78

21

Transaction and related costs

3

6

47

3

59

4

Transformation costs

6

3

3

5

17

2

Purchase accoutning adjustments to fixed assets

-

-

16

13

29

11

Purchase accounting adjustments to inventory

-

-

102

-

102

-

Loss (Gain) on extinguishment of debt

-

4

-

1

5

(56)

Divestitures

(4)

-

-

-

(4)

-

Commitment Fee expense

18

4

-

-

22

-

Escrow interest

-

12

-

-

12

-

Inventory impact related to the exit of certain Production Print manufacturing operations

7

10

3

4

24

-

Tax on adjusted items

29

(49)

507

(13)

474

(3)

86

29

787

65

967

54

Total Non-GAAP Adjustments

**For those periods that exclude the preferred stock dividend the average shares for the calculations of diluted EPS include 7 million shares

associated with our Series A or Series B convertible pref stock.

Xerox Holdings Financial Model

(unaudited)

(in $ millions)

2025

2026

Q1

Q2

Q3

Q4

FY

Q1

Revenue

Entry

43

51

119

168

381

135

Mid-range

198

235

222

258

913

198

High-end

40

44

39

52

175

40

Other

3

6

3

7

19

5

Total Equipment Revenue

284

336

383

485

1,488

378

Installs

Entry

Color

18%

(4)%

(0)%

(4)%

2%

(29)%

B&W

39%

(18)%

(38)%

(8)%

(12)%

11%

Mid-range

Color

11%

0%

2%

(21)%

(4)%

(27)%

B&W

(11)%

(23)%

(17)%

(23)%

(19)%

(28)%

High-end

Color

(19)%

(16)%

(31)%

(21)%

(22)%

35%

B&W

(67)%

(73)%

(97)%

(83)%

(83)%

(76)%

Notes:

CC = Constant Currency

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