Xerox Holdings Corporation (NASDAQ: XRX) today announced its 2024 fourth-quarter and full-year results and guidance for 2025. “2024 was a critical year as we implemented a new operating model and st...
Company advances Reinvention; guides to growth in revenue and profits for 2025
Financial Summary
Q4 2024
FY 2024
NORWALK, Conn.: Xerox Holdings Corporation (NASDAQ: XRX) today announced its 2024 fourth-quarter and full-year results and guidance for 2025.
“2024 was a critical year as we implemented a new operating model and structural process improvements to position Xerox for long-term, sustainable growth,” said Steve Bandrowczak, chief executive officer at Xerox. “We continue to see steady progress in our Reinvention, reflecting the resilience of our team and initiatives taken to-date. In 2025, we expect to build on changes made in 2024 in order to focus on executing our Reinvention strategy, realizing the benefits of the ITsavvy and pending Lexmark acquisitions, and strengthening our balance sheet.”
Fourth-Quarter Key Financial Results
(in millions, except per share data) | Q4 2024 |
| Q4 2023 |
| B/(W) |
| % Change | |
Revenue | $1,613 |
| $1,765 |
| $(152) |
| (8.6)% AC (8.0)% CC1 | |
Gross Profit | $502 |
| $592 |
| $(90) |
| (15.2)% | |
Gross Margin | 31.1% |
| 33.5% |
| (240) bps |
|
| |
RD&E % | 2.9% |
| 3.2% |
| 30 bps |
|
| |
SAG % | 23.4% |
| 24.9% |
| 150 bps |
|
| |
Pre-Tax (Loss)2 | $(4) |
| $(88) |
| $84 |
| NM | |
Pre-Tax (Loss) Margin2 | (0.2)% |
| (5.0)% |
| 480 bps |
|
| |
Gross Profit - Adjusted1 | $509 |
| $592 |
| $(83) |
| (14.0)% | |
Gross Margin - Adjusted1 | 31.6% |
| 33.5% |
| (190) bps |
|
| |
Operating Income - Adjusted1 | $104 |
| $96 |
| $8 |
| 8.3% | |
Operating Income Margin - Adjusted1 | 6.4% |
| 5.4% |
| 100 bps |
|
| |
GAAP Diluted (Loss) per Share2 | $(0.20) |
| $(0.50) |
| $0.30 |
| NM | |
Diluted Earnings Per Share - Adjusted1 | $0.36 |
| $0.43 |
| $(0.07) |
| (16.3)% |
Full-Year Key Financial Results
(in millions, except per share data) | FY 2024 |
| FY 2023 |
| B/(W) |
| % Change | |
Revenue | $6,221 |
| $6,886 |
| $(665) |
| (9.7)% AC (9.5)% CC1 | |
Gross Profit | $1,960 |
| $2,314 |
| $(354) |
| (15.3)% | |
Gross Margin | 31.5% |
| 33.6% |
| (210) bps |
|
| |
RD&E % | 3.1% |
| 3.3% |
| 20 bps |
|
| |
SAG % | 24.7% |
| 24.6% |
| (10) bps |
|
| |
Pre-Tax (Loss)2 | $(1,216) |
| $(28) |
| $(1,188) |
| NM | |
Pre-Tax (Loss) Margin2 | (19.5)% |
| (0.4)% |
| NM |
|
| |
Gross Profit - Adjusted1 | $2,011 |
| $2,314 |
| $(303) |
| (13.1)% | |
Gross Margin - Adjusted1 | 32.3% |
| 33.6% |
| (130) bps |
|
| |
Operating Income - Adjusted1 | $302 |
| $389 |
| $(87) |
| (22.4)% | |
Operating Income Margin - Adjusted1 | 4.9% |
| 5.6% |
| (70) bps |
|
| |
GAAP Diluted (Loss) per Share2 | $(10.75) |
| $(0.09) |
| $(10.66) |
| NM | |
Diluted Earnings Per Share - Adjusted1 | $0.97 |
| $1.82 |
| $(0.85) |
| (46.7)% |
_____________
Fourth-Quarter Segment Results
(in millions) | Q4 2024 |
| Q4 2023 |
| B/(W) |
| % Change | |
Revenue |
|
|
|
|
|
|
| |
Print and Other | $1,540 |
| $1,686 |
| $(146) |
| (8.7)% | |
XFS | 89 |
| 100 |
| (11) |
| (11.0)% | |
Intersegment Elimination1 | (16) |
| (21) |
| 5 |
| (23.8)% | |
Total Revenue | $1,613 |
| $1,765 |
| $(152) |
| (8.6)% | |
Profit |
|
|
|
|
|
|
| |
Print and Other | $87 |
| $89 |
| $(2) |
| (2.2)% | |
XFS | 17 |
| 7 |
| 10 |
| 142.9% | |
Total Profit | $104 |
| $96 |
| $8 |
| 8.3% |
Full-Year Segment Results
(in millions) | FY 2024 |
| FY 2023 |
| B/(W) |
| % Change | |
Revenue |
|
|
|
|
|
|
| |
Print and Other | $5,935 |
| $6,571 |
| $(636) |
| (9.7)% | |
XFS | 357 |
| 401 |
| (44) |
| (11.0)% | |
Intersegment Elimination1 | (71) |
| (86) |
| 15 |
| (17.4)% | |
Total Revenue | $6,221 |
| $6,886 |
| $(665) |
| (9.7)% | |
Profit |
|
|
|
|
|
|
| |
Print and Other | $268 |
| $360 |
| $(92) |
| (25.6)% | |
XFS | 34 |
| 29 |
| 5 |
| 17.2% | |
Total Profit | $302 |
| $389 |
| $(87) |
| (22.4)% |
_____________
2025 Guidance
Guidance does not include any impacts associated with the pending acquisition of Lexmark, which is expected to close in 2H 2025.
Non-GAAP Measures
This release refers to the following non-GAAP financial measures:
_____________
1 Refer to the “Non-GAAP Financial Measures” section of this release for a discussion of these non-GAAP measures and their reconciliation to the reported GAAP measures.
Forward Looking Statements
Certain statements contained in this communication may be characterized as forward-looking under the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially.
Statements in this communication regarding Xerox and Lexmark that are forward-looking may include statements regarding: (i) the transaction; (ii) the expected timing of the closing of the transaction; (iii) considerations taken into account in approving and entering into the transaction; (iv) the anticipated benefits to, or impact of, the transaction on Xerox's and Lexmark's businesses; and (v) expectations for Xerox and Lexmark following the closing of the transaction. There can be no assurance that the transaction will be consummated.
Risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements, in addition to those identified above, include: (i) the possibility that the conditions to the closing of the transaction are not satisfied, including the risk that required shareholder and regulatory approvals are not obtained, on a timely basis or at all; (ii) the occurrence of any event, change or other circumstance that could give rise to a right to terminate the transaction, including in circumstances requiring Xerox or Lexmark to reimburse the other’s expenses or pay a termination fee; (iii) possible disruption related to the transaction to Xerox's and Lexmark's current plans, operations and business relationships, including through the loss of customers and employees; (iv) the amount of the costs, fees, expenses and other charges incurred by Xerox and Lexmark related to the transaction; (v) the risk that Xerox's stock price may fluctuate during the pendency of the transaction and may decline if the transaction is not completed; (vi) the diversion of Xerox and Lexmark management's time and attention from ongoing business operations and opportunities; (vii) the response of competitors and other market participants to the transaction; (viii) potential litigation relating to the transaction; (ix) uncertainty as to timing of completion of the transaction and the ability of each party to consummate the transaction; (x) Xerox’s ability to finance the transaction; (xi) the ability of the combined company to achieve potential market share expansion; (xii) the ability of the combined company to achieve the identified synergies; (xiii) Xerox’s indebtedness, including the indebtedness Xerox expects to incur and/or assume in connection with the transaction and the need to generate sufficient cash flows to service and repay such debt; (xiv) the ability to integrate the Lexmark business into Xerox and realize the anticipated strategic benefits of the transaction within the expected time-frames or at all; (xv) that such integration may be more difficult, time-consuming or costly than expected; (xvi) that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers or suppliers) may be greater than expected following the transaction; (xvii) rating agency actions and Xerox’s ability to access short- and long-term debt markets on a timely and affordable basis; (xviii) general economic conditions that are less favorable than expected; and (xix) other risks and uncertainties detailed in the periodic reports that Xerox filed with the Securities and Exchange Commission, including Xerox's Annual Report on Form 10-K. All forward-looking statements in this communication are based on information available to Xerox as of the date of this communication, and Xerox intends these forward-looking statements to speak only as of the date of this release and does not undertake to update or revise them as more information becomes available, except as required by law.
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