Latest news with #SteveBandrowczak
Business Wire
01-07-2025
- Business
- Business Wire
Xerox Completes the Acquisition of Lexmark, Uniting Two Industry Leaders
NORWALK, Conn.--(BUSINESS WIRE)-- Xerox Holdings Corporation (NASDAQ: XRX) today completed its acquisition of Lexmark International, Inc. from Ninestar Corporation, PAG Asia Capital, and Shanghai Shouda Investment Centre. The transaction, valued at $1.5 billion inclusive of net debt and assumed liabilities, marks a significant milestone in the company's strategic transformation and reinforces its commitment to delivering innovative workplace solutions in an evolving hybrid environment. 'We've long admired Lexmark's strong print and managed print services reputation, robust client and partner base, and global presence. Over the years, we've built a collaborative partnership, and today, we take our business to the next level,' said Steve Bandrowczak, chief executive officer at Xerox. 'Together, we will drive greater success for our clients and partners through a broader portfolio of Print and Managed Print solutions, furthering our Reinvention and solidifying our path toward long-term profitable growth.' 'Today is a pivotal moment for Xerox and Lexmark as these two great companies combine to shape the future of the printing industry,' said Allen Waugerman, who is stepping down as Lexmark president and chief executive officer with this close. 'Leading Lexmark has been an incredible opportunity, and I look forward to the accomplishments that lie ahead.' Steve Bandrowczak will remain CEO of Xerox with an executive team comprised of Xerox and Lexmark leaders. The unified leadership team is structured to accelerate innovation and scale, leveraging the deep bench of talent from both companies. The combined organization will serve over 200,000 clients in over 170 countries and operate 125 manufacturing and distribution facilities in 16 countries. "With the acquisition of Lexmark, Xerox now stands among the top five in every major print segment and is the market leader in managed print services. This strategic combination strengthens our core business by adding exposure to growing parts of the Print market, manufacturing capacity and expanding our distribution reach," said Bandrowczak. "The transaction accelerates our Reinvention by improving our mix of revenue from growing markets and further enabling long-term growth in adjusted operating profit through structural simplification. By uniting two complementary portfolios and deepening our capabilities, we're better equipped than ever to deliver innovative, end-to-end solutions that drive success for our clients across every geography and industry." Transaction Detail The acquisition was financed through a combination of cash on hand and debt financing. The company continues to expect the transaction to be accretive to 2025 adjusted earnings per share and free cash flow and result in a lower level of pro forma gross debt leverage. Further, the company expects approximately $240 million of transaction-related cost synergies to contribute over $1/share of additional adjusted EPS accretion by the end of the second year following the transaction close. Advisors Jefferies LLC is serving as the financial advisor to Xerox and Citi is also providing financial advice. Ropes & Gray LLP and Willkie Farr & Gallagher LLP are serving as legal advisors to Xerox. Morgan Stanley & Co. LLC is serving as financial advisor to Lexmark and Strait Capital Management is serving as financial advisor to Ninestar Corporation. Dechert LLP is serving as legal advisor to Lexmark, as well as Ninestar Corporation, PAG Asia Capital and Shanghai Shouda Investment Centre and King & Wood Mallesons is serving as PRC counsel to Ninestar Corporation. Forward-Looking Statement This press release and other written or oral statements made from time to time by management contain 'forward looking statements' as defined in the Private Securities Litigation Reform Act of 1995 and involve certain risks and uncertainties. The words 'anticipate', 'believe', 'estimate', 'expect', 'intend', 'will', 'would', 'could', 'can', 'should', 'targeting', 'projecting', 'driving', 'future', 'plan', 'predict', 'may' and similar expressions are intended to identify forward-looking statements. The Company's actual results may differ significantly from the results discussed in the forward-looking statements. These statements reflect management's current beliefs and assumptions and are subject to a number of other factors that may cause actual results to differ materially. Such factors include but are not limited to: applicable market conditions; global macroeconomic conditions, including inflation, slower growth or recession, delays or disruptions in the global supply chain, higher interest rates, and wars and other conflicts, including the current conflict between Russia and Ukraine; our ability to succeed in a competitive environment, including by developing new products and service offerings and preserving our existing products and market share as well as repositioning our business in the face of customer preference, technological, and other change, such as evolving return-to-office and hybrid working trends; failure of our customers, vendors, and logistics partners to perform their contractual obligations to us; our ability to attract, train, and retain key personnel; execution risks around our Reinvention; the risk of breaches of our security systems due to cyber, malware, or other intentional attacks that could expose us to liability, litigation, regulatory action or damage our reputation; our ability to obtain adequate pricing for our products and services and to maintain and improve our cost structure; changes in economic and political conditions, licensing requirements, and tax laws in the United States and in the foreign countries in which we do business; the risk that multi-year contracts with governmental entities could be terminated prior to the end of the contract term and that civil or criminal penalties and administrative sanctions could be imposed on us if we fail to comply with the terms of such contracts and applicable law; interest rates, cost of capital, and access to credit markets; risks related to our indebtedness; the imposition of new or incremental trade protection measures such as tariffs and import or export restrictions; funding requirements associated with our employee pension and retiree health benefit plans; changes in foreign currency exchange rates; the risk that we may be subject to new or heightened regulatory or operation risks as a result of our, or third parties,' use or anticipated use of artificial intelligence technologies; the risk that our operations and products may not comply with applicable worldwide regulatory requirements, particularly environmental regulations and directives and anti-corruption laws; the outcome of litigation and regulatory proceedings to which we may be a party; laws, regulations, international agreements and other initiatives to limit greenhouse gas emissions or relating to climate change, as well as the physical effects of climate change; our ability to successfully integrate the Lexmark business and realize the anticipated benefits thereof, including expected synergies; and other factors that are set forth from time to time in the Company's Securities and Exchange Commission filings, including the combined Annual Report on Form 10-K of Xerox Holdings and Xerox Corporation. These forward-looking statements speak only as of the date hereof or of the date to which they refer, and the Company assumes no obligation to update or revise any forward-looking statements as a result of new information or future events or developments, except as required by law. About Xerox Holdings Corporation (NASDAQ: XRX) Xerox has been redefining the workplace experience for over a century. As a services-led, software-enabled company, we power today's hybrid workplace through advanced print, digital, and AI-driven technologies. In 2025 Xerox acquired Lexmark - expanding our global footprint, strengthening service capabilities, and equipping us to deliver an even broader portfolio of workplace technologies to our clients. Today, we continue our legacy of innovation to deliver client-centric, digitally driven solutions that meet the needs of a global, distributed workforce. Whether in offices, classrooms, or hospitals, we help our clients thrive in a constantly evolving business landscape. Xerox ® is a trademark of Xerox in the United States and/or other countries.
Yahoo
26-06-2025
- Business
- Yahoo
5 Must-Read Analyst Questions From Xerox's Q1 Earnings Call
Xerox's first quarter results for 2025 were met with a positive market reaction, as management highlighted the early benefits of its multi-year reinvention program and successful integration of ITsavvy. The company pointed to improved operational efficiency and cost reductions, with CEO Steve Bandrowczak noting, 'Balanced execution, the benefits of last year's reinvention, and ongoing initiatives resulted in an improved revenue trajectory.' Notably, equipment installations saw double-digit growth, driven by strong channel partner activity and the global launch of the PrimeLink product, while operating expenses declined at a double-digit rate excluding one-time items. Is now the time to buy XRX? Find out in our full research report (it's free). Revenue: $1.46 billion vs analyst estimates of $1.46 billion (3% year-on-year decline, in line) Adjusted EPS: -$0.06 vs analyst estimates of -$0.04 ($0.02 miss) Adjusted EBITDA: $72 million vs analyst estimates of $165.8 million (4.9% margin, 56.6% miss) Operating Margin: 0.1%, up from -7.1% in the same quarter last year Market Capitalization: $678 million While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Ananda Baruah (Loop Capital): Asked about macroeconomic signals from large customers and SMBs. President John Bruno explained that while there is volatility, no significant demand cancellations have occurred, only some delays in spending decisions. Ananda Baruah (Loop Capital): Requested context on ITsavvy integration. CEO Steve Bandrowczak highlighted acceleration in cross-selling, pipeline growth, and collaboration between legacy Xerox and ITsavvy teams, describing the opportunity as 'very exciting.' Erik Woodring (Morgan Stanley): Questioned the rationale for maintaining annual guidance amid tariff uncertainty. CFO Mirlanda Gecaj explained that guidance will remain until tariffs are finalized, emphasizing a commitment to existing targets while providing transparency on potential impacts. Erik Woodring (Morgan Stanley): Asked about the margin outlook for IT Solutions. Bandrowczak and Bruno said they aim for double-digit operating profit, leveraging scale and lower SG&A, with margins expected to improve as cross-selling expands. Samik Chatterjee (JPMorgan): Probed the drivers behind the post-sale revenue decline. Bruno cited lower print volumes and supplies, but expects stabilization as new equipment installations drive future post-sale activity. Looking ahead, our analysts will be closely tracking (1) progress on integration and synergy realization from the ITsavvy and Lexmark acquisitions, (2) the pace and effectiveness of tariff mitigation strategies, and (3) continued growth and profitability improvements in IT Solutions and print equipment installations. Execution against reinvention savings targets and cross-selling milestones will also be key indicators of strategic progress. Xerox currently trades at $5.38, up from $4.41 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it's free). The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
01-05-2025
- Business
- Yahoo
Xerox (NASDAQ:XRX) Posts Q1 Sales In Line With Estimates
Document technology company Xerox (NASDAQ:XRX) met Wall Street's revenue expectations in Q1 CY2025, but sales fell by 3% year on year to $1.46 billion. Its GAAP loss of $0.75 per share increased from -$0.94 in the same quarter last year. Is now the time to buy Xerox? Find out in our full research report. Revenue: $1.46 billion vs analyst estimates of $1.46 billion (3% year-on-year decline, in line) Adjusted EBITDA: $120 million vs analyst estimates of $165.8 million (8.2% margin, 27.6% miss) Operating Margin: 3.3%, up from -7.1% in the same quarter last year Free Cash Flow was -$109 million compared to -$89 million in the same quarter last year Market Capitalization: $554.7 million "In a quarter marked by increasing levels of macroeconomic and trade policy uncertainty, our team remained focused on what we can control: the balanced execution of our Reinvention and delivering client success," said Steve Bandrowczak, CEO at Xerox. Pioneering the modern office copier and inventing technologies like Ethernet and the laser printer, Xerox (NASDAQ:XRX) provides document management systems, printing technology, and workplace solutions to businesses of all sizes across the globe. A company's long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. With $6.18 billion in revenue over the past 12 months, Xerox is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions. However, its scale is a double-edged sword because finding new avenues for growth becomes difficult when you already have a substantial market presence. To accelerate sales, Xerox likely needs to optimize its pricing or lean into new offerings and international expansion. As you can see below, Xerox struggled to generate demand over the last five years. Its sales dropped by 6.7% annually, a rough starting point for our analysis. We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Xerox's annualized revenue declines of 7.1% over the last two years align with its five-year trend, suggesting its demand has consistently shrunk. This quarter, Xerox reported a rather uninspiring 3% year-on-year revenue decline to $1.46 billion of revenue, in line with Wall Street's estimates. Looking ahead, sell-side analysts expect revenue to decline by 2.3% over the next 12 months. While this projection is better than its two-year trend, it's tough to feel optimistic about a company facing demand difficulties. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D. Although Xerox was profitable this quarter from an operational perspective, it's generally struggled over a longer time period. Its expensive cost structure has contributed to an average operating margin of negative 4.3% over the last five years. Unprofitable business services companies require extra attention because they could get caught swimming naked when the tide goes out. It's hard to trust that the business can endure a full cycle. Analyzing the trend in its profitability, Xerox's operating margin decreased by 19.5 percentage points over the last five years. Xerox's performance was poor no matter how you look at it - it shows that costs were rising and it couldn't pass them onto its customers. This quarter, Xerox generated an operating profit margin of 3.3%, up 10.4 percentage points year on year. This increase was a welcome development, especially since its revenue fell, showing it was more efficient because it scaled down its expenses. Revenue trends explain a company's historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions. Sadly for Xerox, its EPS declined by 36.5% annually over the last five years, more than its revenue. This tells us the company struggled because its fixed cost base made it difficult to adjust to shrinking demand. We can take a deeper look into Xerox's earnings to better understand the drivers of its performance. As we mentioned earlier, Xerox's operating margin improved this quarter but declined by 19.5 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; taxes and interest expenses can also affect EPS but don't tell us as much about a company's fundamentals. In Q1, Xerox reported EPS at negative $0.75, up from negative $0.94 in the same quarter last year. We also like to analyze expected EPS growth based on Wall Street analysts' consensus projections, but there is insufficient data. We struggled to find many positives in these results as its revenue was in line and its EBITDA missed. However, the stock traded up 1.8% to $4.49 immediately following the results. Is Xerox an attractive investment opportunity right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it's free. Sign in to access your portfolio
