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Xerox Corporation (XRX)
:XRX
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Xerox
(NASDAQ:XRX)
Rating:48Neutral
Price Target:
$4.00
▲(8.70% Upside)
Positive Factors
Lexmark Acquisition
The Lexmark acquisition enhances Xerox's market position, promising over $250 million in cost synergies, boosting long-term profitability and competitive strength.
IT Solutions Growth
The robust growth in IT Solutions indicates a successful diversification strategy, enhancing Xerox's revenue streams and reducing reliance on traditional print services.
Leadership Changes
New leadership under Louie Pastor is expected to drive growth and transformation, potentially improving operational efficiency and strategic execution.
Negative Factors
Declining Revenue
Declining revenue reflects challenges in maintaining sales growth, which could impact long-term financial stability and market competitiveness.
Operating Margin Decline
Falling operating margins indicate operational inefficiencies, potentially affecting Xerox's ability to sustain profitability and invest in growth initiatives.
High Financial Leverage
High financial leverage can strain cash flow and limit financial flexibility, posing risks to Xerox's long-term financial health and strategic options.
Xerox (XRX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$463.05M
Dividend Yield17.66%
Average Volume (3M)4.12M
Price to Earnings (P/E)―
Beta (1Y)1.99
Revenue Growth-4.99%
EPS Growth-1016.81%
CountryUS
Employees17,600
SectorTechnology
Sector Strength87
IndustryInformation Technology Services
Share Statistics
EPS (TTM)-0.64
Shares Outstanding125,829,400
10 Day Avg. Volume3,784,300
30 Day Avg. Volume4,121,411
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.81
Price to Sales (P/S)0.17
P/FCF Ratio2.24
Enterprise Value/Market Cap8.81
Enterprise Value/Revenue0.66
Enterprise Value/Gross Profit2.19
Enterprise Value/Ebitda-5.14
Forecast
1Y Price Target
$4.75Price Target Upside29.08% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering2
Xerox Business Overview & Revenue Model
Company DescriptionXerox Holdings Corporation (XRX) is a multinational corporation that specializes in printing and document management solutions. Founded in 1906, Xerox operates primarily in the technology sector, providing a range of products and services including digital printing systems, managed print services, and document management software. The company serves various industries, including education, healthcare, and government, with a focus on innovative solutions that enhance productivity and efficiency.
How the Company Makes MoneyXerox generates revenue through multiple streams, including the sale of hardware, such as printers and multifunction devices, and the sale of consumables like toner and ink. Managed print services, which involve optimizing a company's printing environment to reduce costs and increase efficiency, also contribute significantly to its revenue. Additionally, Xerox earns income from software solutions that improve document workflow and management. The company has formed strategic partnerships with other tech firms and service providers to enhance its offerings and access new markets, further bolstering its financial performance.
Xerox Key Performance Indicators (KPIs)
Xerox Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 28, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. The successful completion of the Lexmark acquisition and strong IT Solutions growth are significant positives, but these are somewhat offset by flat revenues, declining operating margins, and challenges related to tariffs. The company's strategic direction remains positive, with expectations of synergy realizations driving future improvements.Q2-2025 Updates
Positive Updates
Lexmark Acquisition Completion
The acquisition of Lexmark was completed in early July, marking a significant milestone in Xerox's Reinvention strategy. The integration is progressing well, with expectations of more than $250 million in cost synergies within two years.
IT Solutions Segment Growth
Strong demand for cloud enablement services at the IT Solutions segment helped offset softer demand for print equipment, with IT Solutions revenue and gross profit increasing more than 150% year-over-year.
Cost Synergy Expectations Increased
Expected cost synergies from the Lexmark acquisition have been revised upwards from $200 million to more than $250 million, realizable within the next two years.
Improved Competitive Profile
The combined Xerox and Lexmark businesses are now a top 3 player in each major print category, with a significant portion of revenue from recurring sources.
Negative Updates
Slight Decline in Revenue
Revenue for the quarter was roughly flat in actual currency and declined 1.1% in constant currency.
Adjusted Operating Income Margin Decline
The adjusted operating income margin of 3.7% was lower year-over-year by 170 basis points.
Adjusted Loss Per Share
Adjusted loss per share of $0.64 declined $0.93 year-over-year, primarily due to a higher adjusted tax rate and lower adjusted operating income.
Challenges with Tariffs
Higher-than-expected tariff-related expenses impacted operating margins and led to delays in the sales of OEM supplies.
Company Guidance
During the Xerox Holdings Corporation Q2 2025 earnings call, guidance was provided on several key metrics and strategic initiatives. The company reported a revenue of approximately $1.58 billion, which was flat year-over-year in actual currency and declined by 1.1% in constant currency. The adjusted operating income margin was 3.7%, down 170 basis points from the previous year. Xerox experienced a free cash flow use of $30 million, partly due to a delay in the sale of a large portfolio of finance receivables. The adjusted loss per share was $0.64, down $0.93 year-over-year, primarily driven by an unfavorable tax rate. Guidance for fiscal year 2025 includes revenue growth of 16% to 17% in constant currency, incorporating around $1 billion from the Lexmark acquisition. The adjusted operating income margin is projected at around 4.5%, and free cash flow is expected to be approximately $250 million. The Lexmark acquisition is anticipated to generate more than $250 million in cost synergies within the next two years, while the company remains focused on debt repayment as its top capital allocation priority.Xerox Financial Statement Overview
Summary
Xerox faces significant financial challenges with declining revenues and profitability. Despite a stable cash flow, high financial leverage and negative profit margins indicate operational inefficiencies. The financial performance needs improvement to enhance overall financial health.Income Statement
Xerox has faced declining revenues and profitability, with significant drops in gross and net profit margins over the TTM. Revenue growth has been negative, indicating challenges in maintaining sales. The negative EBIT and EBITDA margins in the TTM highlight operational inefficiencies and financial challenges.42
Neutral
Balance Sheet
The company's balance sheet shows a moderate debt-to-equity ratio, reflecting a significant level of financial leverage. The equity ratio has decreased over time, indicating reduced equity in proportion to total assets. Return on equity is negative due to the net loss, showing a lack of profitability for shareholder investments.55
Neutral
Cash Flow
Xerox's cash flow remains relatively stable, with positive operating and free cash flow, despite negative net income. The operating cash flow to net income ratio is high, indicating strong cash generation relative to reported earnings losses. However, free cash flow growth has been negative, signifying potential challenges in sustaining cash flow levels.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.17B | 6.22B | 6.89B | 7.11B | 7.04B | 7.02B |
| Gross Profit | 1.86B | 1.96B | 2.31B | 2.32B | 2.40B | 2.63B |
| EBITDA | -794.00M | -822.00M | 307.00M | 47.00M | 695.00M | 718.00M |
| Net Income | -1.42B | -1.32B | 1.00M | -322.00M | -455.00M | 192.00M |
Balance Sheet | ||||||
| Total Assets | 8.87B | 8.37B | 10.01B | 11.54B | 13.22B | 14.74B |
| Cash, Cash Equivalents and Short-Term Investments | 449.00M | 576.00M | 519.00M | 1.04B | 1.84B | 2.63B |
| Total Debt | 3.94B | 3.59B | 3.46B | 3.96B | 4.54B | 4.79B |
| Total Liabilities | 7.52B | 7.06B | 7.24B | 7.97B | 8.56B | 8.93B |
| Stockholders Equity | 1.34B | 1.29B | 2.75B | 3.56B | 4.65B | 5.81B |
Cash Flow | ||||||
| Free Cash Flow | 302.00M | 467.00M | 649.00M | 102.00M | 561.00M | 474.00M |
| Operating Cash Flow | 367.00M | 511.00M | 686.00M | 159.00M | 629.00M | 548.00M |
| Investing Cash Flow | -191.00M | -198.00M | -5.00M | -78.00M | -85.00M | -246.00M |
| Financing Cash Flow | 263.00M | -271.00M | -1.20B | -822.00M | -1.31B | -416.00M |
Xerox Technical Analysis
Negative
3.68
Price Trends
4.51
Negative
4.81
Negative
5.97
Negative
Market Momentum
-0.21
Negative
38.19
Neutral
11.93
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XRX, the sentiment is Negative. The current price of 3.68 is below the 20-day moving average (MA) of 3.83, below the 50-day MA of 4.51, and below the 200-day MA of 5.97, indicating a bearish trend. The MACD of -0.21 indicates Negative momentum. The RSI at 38.19 is Neutral, neither overbought nor oversold. The STOCH value of 11.93 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for XRX.
Xerox Risk Analysis
Xerox disclosed 28 risk factors in its most recent earnings report. Xerox reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Xerox Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $29.89B | 20.86 | 16.50% | 2.99% | -1.95% | 35.65% | |
67 Neutral | $2.51B | 6.83 | 12.60% | ― | -4.93% | 497.03% | |
61 Neutral | $36.85B | 12.13 | -10.22% | 1.85% | 8.52% | -7.53% | |
61 Neutral | $7.39B | 26.12 | 26.55% | ― | -3.44% | ― | |
54 Neutral | $445.49M | 91.56 | 2.21% | ― | -14.36% | -73.74% | |
53 Neutral | $281.61M | ― | 192.24% | ― | -1.53% | 78.84% | |
48 Neutral | $463.05M | ― | -72.72% | 17.66% | -4.99% | -1016.81% |
* Technology Sector Average
Performance Comparison
XRX
Xerox
3.68
-6.07
-62.26%
UIS
Unisys
3.95
-1.71
-30.21%
WIT
Wipro
2.77
-0.41
-12.89%
CNDT
Conduent
2.82
-1.02
-26.56%
DXC
DXC Technology
14.02
-7.42
-34.61%
KD
Kyndryl Holdings Incorporation
31.95
8.82
38.13%
Xerox Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Xerox Announces Leadership Changes with New President
Neutral
Aug 15, 2025
On August 11, 2025, Xerox Holdings Corporation announced that John Bruno would step down as President and Chief Operating Officer by August 31, 2025, to pursue a CEO role outside the company. Bruno will remain on the board and chair a new Integration Committee. Louie Pastor, currently Chief Administrative Officer and Global Head of Operations, will succeed Bruno as President and COO starting September 1, 2025. Additionally, Jacques-Edouard Gueden will become Chief Revenue Officer, leading Xerox’s print go-to-market units. These leadership changes are part of Xerox’s strategy to drive growth and transformation, with Pastor and Gueden expected to strengthen the company’s market position and operational efficiency.
Executive/Board ChangesShareholder Meetings
Xerox Shareholders Approve Key Proposals at Annual Meeting
Neutral
May 27, 2025
On May 21, 2025, Xerox Holdings Corporation held its annual meeting where shareholders approved several key proposals. These included the election of directors, the ratification of PricewaterhouseCoopers LLP as the independent auditor for 2025, and the advisory approval of the 2024 compensation for named executive officers. Additionally, an amendment to the 2024 Equity and Performance Incentive Plan was approved, indicating continued support for the company’s strategic compensation initiatives.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.