Q2 2025 Xerox Holdings Corp Earnings Call Transcript
Key Points
- The acquisition of Lexmark is expected to enhance Xerox Holdings Corp (XRX)'s competitive position by uniting two industry leaders with complementary operations.
- Strong demand for cloud enablement services in the IT solutions segment helped offset weaker print equipment demand.
- The integration of ITsavvy is ahead of schedule, with strategic and financial benefits being realized sooner than expected.
- Xerox Holdings Corp (XRX) has identified more than $250 million in cost synergies from the Lexmark acquisition, up from the original estimate of $200 million.
- The company is focusing on expanding its IT and digital solutions, which are expected to comprise more than 20% of revenue over time, contributing to revenue stabilization.
- Revenue for the quarter was roughly flat year over year, with a decline of 1.1% in constant currency.
- Adjusted operating income margin decreased by 170 basis points year over year to 3.7%.
- Free cash flow was a use of $30 million, partly due to a delay in the sale of a large portfolio of finance receivables.
- Adjusted loss per share was $0.64, a decline of $0.93 year over year, primarily due to an unfavorable tax rate.
- The company experienced softer demand for print equipment in April and May, attributed to tariff-driven uncertainty and other market pressures.
Welcome to the Xerox Holdings Corporation second quarter 2025 earnings release conference call. (Operator Instructions)
At this time, I would like to turn the meeting over to Mr. David Beckel, Vice President and Head of Investor Relations.
Good morning, everyone. I'm David Beckel, Vice President and Head of Investor Relations at Xerox Holdings Corporation. Welcome to the Xerox Holdings Corporation, second quarter 2025 earnings release conference call hosted by Steve Bandrowczak, Chief Executive Officer. He's joined by John Bruno, President and Chief Operating Officer; and Mirlanda Gecaj, Chief Financial Officer. At the request of Xerox Holdings Corporation today's conference call is being recorded.
Other recording and/or rebroadcasting of this call are prohibited without the expressed permission of Xerox. During this call, Xerox executives will refer to slides that are available on the web at www.xerox.com
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