Xerox Releases Second-Quarter Results

NORWALK, Conn. – July 28, 2020 – Xerox Holdings Corporation announced its second-quarter 2020 financial results.

“I am proud of our employees who did what was necessary during this unprecedented disruption to support our business and clients, especially those delivering essential services. While the bulk of our markets were fully or partially shut down during the quarter, our team’s financial discipline enabled us to deliver positive earnings per share and cash flow while continuing to invest in key areas of growth,” said Xerox Vice Chairman and CEO John Visentin. “No one can control or accurately predict what happens next. We have modeled numerous scenarios to ensure we have flexibility no matter how the pandemic continues to impact global business.”

Second-Quarter Key Financial Results – Continuing Operations

(in millions, except per share data)

Q2 2020

Q2 2019

B/(W)
YOY

% Change
YOY

Revenue

$1,465

$2,263

$(798)

(35.3)% AC
(34.6)% CC1

Gross Margin

38.5%

39.1%

(60) bps

RD&E %

5.2%

3.9%

(130) bps

SAG %

29.1%

22.8%

(630) bps

Pre-Tax Income

$35

$190

$(155)

(81.6)%

Pre-Tax Income Margin

2.4%

8.4%

(600) bps

Operating Income – Adjusted1

$62

$280

$(218)

(77.9)%

Operating Margin – Adjusted1

4.2%

12.4%

(820) bps

GAAP EPS

$0.11

$0.60

$(0.49)

(81.7)%

EPS – Adjusted1

$0.15

$0.79

$(0.64)

(81.0)%

(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.

Business Highlights

  • Launched “Make Now Work,” an integrated content marketing campaign that demonstrates how Xerox supports clients’ digital transformations and changing needs accelerated by COVID-19.
  • Added and renewed several Fortune 500 and public sector clients such as HM Land Registry; Ministry of Citizens’ Services, BC Mail Plus; Veterans Affairs of Montana & Wyoming; and Allianz.
  • Expanded the company’s software portfolio with the launch of the Xerox Team Availability App to support flexible workplace needs.
  • Introduced the next-generation AltaLink® C8100/B8100 Series with ConnectKey® apps and automation that speeds digital transformation and supports workers in and out of the office.
  • Announced the Adaptive CMYK+ Kit for the Xerox Versant®, an enhancement that allows print providers to offer higher value, embellishment solutions without a major investment.
  • Stood up manufacturing operations for Xerox’s COVID-19 healthcare initiatives such as making disposable, low-cost FDA-cleared ventilators and hospital-grade hand sanitizer—an area where the company is doubling production in response to demand.
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