Xerox earned a revenue of US$1.50 billion in Q1 2024, a decline of 12.4 per cent YoY. The adjusted net income was $11 million, a decline of US$71 million year-over-year.
“This quarter, Xerox orchestrated one of its most intense periods of structural change in recent history, continuing the hard work required to reposition our business for long-term, sustainable growth. We implemented comprehensive and strategic operating model changes to align our organization more closely with our buyers’ needs and improve efficiency,” said Steve Bandrowczak, chief executive officer at Xerox. “While results were below our expectations in Q1, I have full confidence we have the right team and the right strategy to execute Xerox’s Reinvention and deliver on our adjusted operating income targets.”
Looking ahead, the company expects a revenue decline of three to five per cent in constant currency. It assumes stable demand in traditional print, growth in digital and IT services and neutral macro-economic conditions. The guided year-over-year decline in revenue is attributed to:
- around 200 basis points of headwind from prior-year backlog reduction; and
- around 200 basis points from the de-emphasis of certain non-strategic revenue, including lower sales of paper.
Margin guidance implies adjusted operating income margin improvement of more than 190 basis points, and adjusted operating income improvement of more than $100 million, year-over-year. The company maintains its three-year target of US$300 million of incremental adjusted operating income above 2023 levels and a return to double-digit adjusted operating income margin by 2026.
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