Overview

• Document management firm's Q4 revenue rose 25.7% yr/yr but missed analyst expectations

• Adjusted EPS for Q4 missed analyst expectations

• Company highlighted successful Lexmark integration, contributing to performance despite challenges

Outlook

• Xerox expects 2026 revenue above $7.5 bln

• Company anticipates 2026 adjusted operating income of $450-$500 mln

• Xerox forecasts 2026 free cash flow of approximately $250 mln

Result Drivers

• LEXMARK INTEGRATION - Successful integration of Lexmark contributed to Q4 performance, providing synergies and boosting revenue

• MACROECONOMIC HEADWINDS - Rising DRAM costs and tariffs increased product costs, impacting IT Solutions and Print business

• COST SAVINGS - Cost-saving measures and synergies from Lexmark integration helped mitigate higher tariffs and product costs

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q4 Revenue	Miss	$2.03 bln	$2.11 bln (3 Analysts)
Q4 Adjusted EPS	Miss	-$0.10	$0.10 (1 Analyst)

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 2 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the office equipment peer group is "buy."

• Wall Street's median 12-month price target for Xerox Holdings Corp is $4.00, about 71.7% above its January 28 closing price of $2.33

• The stock recently traded at 2 times the next 12-month earnings vs. a P/E of 3 three months ago

Press Release: ID:nBw3wpD2Ya

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