Xerox Holdings (XRX) Earnings Date & Reports

Xerox Holdings delivered first-quarter 2026 revenue of $1.85 billion, a 26.7% increase year-over-year (23.6% in constant currency), surpassing consensus estimates of approximately $1.76 billion. The growth was propelled by the Lexmark acquisition, contributing about 38 percentage points to equipment sales growth; pro forma revenue declined 3.7%, reflecting softer legacy demand.+Releases+Q1+2026+Earnings)

GAAP loss per share widened to $0.84 from $0.75 in the prior year, impacted by acquisition-related amortization and restructuring costs. Adjusted EPS loss was $0.43 (versus $0.06 prior), with normalized adjusted EPS at $0.11 loss, beating some estimates of -$0.20 to -$0.27. Adjusted operating income rose to $72 million, with margin expanding 240 basis points to 3.9%. Equipment sales reached $378 million (up 33.1%), while post-sale revenue grew 30.1% to $1.314 billion. Free cash flow was negative $165 million, typical Q1 seasonality.

Print segment revenue hit $1.69 billion (up 30.8%), with profit up 112%; IT Solutions revenue dipped 4.9% to $156 million but showed bookings growth. Management highlighted Lexmark synergies on track for at least $300 million and raised $450 million via an IP joint venture.

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Market Reaction and Investor Sentiment

Shares of Xerox Holdings surged over 27% in pre-market trading and around 12.7% intraday following the Q1 earnings release, driven by the revenue beat, margin expansion, and reaffirmed guidance. Investors appeared to prioritize top-line growth from Lexmark and operational improvements over the EPS loss, viewing pro forma trends as stabilizing. Sentiment turned positive, with analysts noting the stock's momentum amid broader focus on transformation execution.

Forward Outlook and Key Factors to Monitor

Xerox Holdings reaffirmed its full-year 2026 guidance, projecting revenue above $7.5 billion in constant currency, adjusted operating income of $450-$500 million, and free cash flow around $250 million. This outlook incorporates $250-300 million in gross cost reductions, including $150-200 million from Lexmark integration synergies and $100 million from transformation initiatives.

Investors should watch print sales pipeline growth, which was materially higher year-over-year, and production installs up 31%, fueled by the Proficio launch. IT Solutions momentum in bookings (up 32%) and billings (up 21%) could offset print headwinds. Leverage reduction remains key, with net debt to adjusted EBITDA at 6.0x, targeting improvement to 5.6x by year-end via debt repurchases and cash generation.

Upcoming catalysts include Q2 execution on cost savings, Lexmark synergy realization, and digital services expansion. Broader industry dynamics, such as demand for managed print services and AI-enhanced offerings, will influence trajectory. Monitor quarterly progress against guidance for signs of sustained margin expansion and revenue stabilization.

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