Operational progress toward 2026 profit and free cash flow improvement continues despite macroeconomic headwinds weighing on 2025 results; Lexmark synergy forecast raised to at least $300M

Financial Summary

Q3 2025

Revenue of $1.96 billion, up 28.3 percent, or 27.0 percent in constant currency⁽¹⁾. On a pro forma⁽¹⁾ basis, revenue down 7.8 percent.
GAAP net (loss) of $(760) million, or $(6.01) per share, narrowing the loss by $445 million or $3.70 per share, year-over-year, respectively.
Adjusted⁽¹⁾ net income of $27 million, or $0.20 per share, down $7 million or $0.05 per share, year-over-year, respectively.
Adjusted⁽¹⁾ operating margin of 3.3 percent, down 190 basis points year-over-year.
Operating cash flow of $159 million, up $43 million year-over-year.
Free cash flow⁽¹⁾ of $131 million, up $24 million year-over-year.

Xerox Holdings Corporation (NASDAQ:XRX) today announced its 2025 third-quarter results.

"While continued macro volatility and near-term uncertainties on government funding decisions weighed on transactional print this quarter, consistent page volume trends and strong IT Solutions momentum reinforce our confidence that Reinvention will deliver durable productivity and long‑term value. We are accelerating that work from a solid foundation established by the Lexmark acquisition and the expansion of our IT Solutions capabilities," said Steve Bandrowczak, chief executive officer at Xerox. "The combined Xerox and Lexmark team is aligning go‑to‑market structure, blending complementary portfolios, and standardizing operating processes to deliver broader solutions and deeper value. Through this work, we've identified meaningful incremental value—with cost synergies now forecasted to be at least $300 million."

Strategic Milestones

Q3 2025

Lexmark Integration ahead of plan; synergy target increases by $50M to at least $300M
IT Solutions pro forma bookings, billings, and revenue grew double digits
Inside Sales > 30% ESR growth year-to-date
Announced the launch of the IJP900, re-entering the Production mid-volume inkjet market
Paid down $226 million of debt, net as of the Lexmark acquisition close on July 1, 2025

Third-Quarter Key Financial Results

(in millions, except per share data)	Q3 2025	Q3 2024	B/(W) YOY	Pro Forma¹ B/(W) YOY
Revenue	$1,961	$1,528	28.3% AC 27.0% CC¹	(7.8)% AC
Gross Profit	$445	$495	$(50)
Gross Margin	22.7%	32.4%	(970) bps	(930) bps
RD&E %	3.8%	2.9%	(90) bps
SAG %	24.3%	24.2%	(10) bps
Pre-Tax Loss²	$(300)	$(1,087)	$787
Pre-Tax Loss Margin²	(15.3)%	(71.1)%	NM
Gross Profit - Adjusted¹	$566	$495	$71
Gross Margin - Adjusted¹	28.9%	32.4%	(350) bps	(380) bps
Operating Income - Adjusted¹	$65	$80	$(15)
Operating Income Margin - Adjusted¹	3.3%	5.2%	(190) bps	(370) bps
GAAP Diluted Loss per Share²	$(6.01)	$(9.71)	$3.70
Diluted Earnings Per Share - Adjusted¹	$0.20	$0.25	$(0.05)

Third-Quarter Segment Results

(in millions)	Q3 2025	Q3 2024	B/(W) YOY	Pro Forma¹ B/(W) YOY
Revenue
Print and Other³	$1,739	$1,442	20.6%	(9.8)%
IT Solutions³	226	86	162.8%	12.4%
Intersegment Elimination⁴	(4)	—	NM	NM
Total Revenue	$1,961	$1,528	28.3%	(7.8)%
Profit
Print and Other³	$64	$103	(37.9)%	(62.6)%
IT Solutions³	18	—	NM	NM
Corporate Other⁵	(17)	(23)	(26.1)%	(34.6)%
Total Profit	$65	$80	(18.8)%	(56.4)%


(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.
(2)	Third quarter 2025 pre-tax loss and Diluted Loss per Share includes an inventory-related purchase accounting adjustment, related to the recent acquisition of Lexmark, of $102 million or $85 million after-tax, respectively, or $0.67 per diluted share. In addition, third quarter 2025 includes a tax expense charge of $467 million, or $3.68 per diluted share, related to the establishment of a valuation allowance against certain deferred tax assets to reflect their realizability. Third quarter 2024 pre-tax loss and Diluted Loss per Share include a pre-tax non-cash goodwill impairment charge of approximately $1.1 billion, and approximately $1.0 billion after-tax, respectively, or $8.16 per diluted share. In addition, the third quarter 2024 Diluted Loss per Share includes a tax expense charge of $161 million, or $1.29 per diluted share, related to the establishment of a valuation allowance against certain deferred tax assets to reflect their realizability. The tax expense charges related to the establishment of valuation allowances in the third quarter 2025 and 2024, respectively, were excluded due to their unique nature and significant impacts which are not considered part of our core operations.
(3)	First quarter 2025, the Company made a change to its reportable segments - Print and Other, and IT Solutions to align with a change in how the Chief Operating Decision Maker, our Chief Executive Officer, allocates resources and assesses performance against the Company's key growth strategies. Prior to this change, the company had two reportable segments - Print and Other, and XFS. As a result of this change, prior period reportable segment results have been recast to reflect the Company's current reportable segments. See APPENDIX II - Reportable Segments.
(4)	Reflects primarily IT hardware, software solutions and services, sold by the IT Solutions segment to the Print and Other segment.
(5)	Corporate Other reflects certain administrative and general expenses, which primarily relate to corporate functions, and are not allocated to either of our reportable segments.

2025 Guidance

Revenue: from 16-17% growth in constant currency¹to 13% growth in constant currency¹
Adjusted¹ Operating Margin: from around 4.5% to around 3.5%
Free cash flow¹: from around $250 million to around $150 million

Non-GAAP Measures

This release refers to the following non-GAAP financial measures:

Adjusted¹ Gross Profit and Margin, which exclude the inventory impact related to the exit of certain Production Print manufacturing operations, included in Cost of services, maintenance and rentals, as well as fixed asset and inventory-related purchase accounting adjustments related to the recent acquisition of Lexmark.
Adjusted¹ EPS, which excludes Restructuring and related costs, net, Amortization of intangible assets, non-service retirement-related costs, and other discrete adjustments from GAAP EPS, as applicable.
Adjusted¹ operating income and margin, which exclude the EPS adjustments noted above as well as the remainder of Other expenses, net from pre-tax loss and margin.
Constant currency (CC)¹ revenue change, which excludes the effects of currency translation.
Free cash flow¹, which is operating cash flow less capital expenditures.


(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 Statement

This presentation 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.

Note: To receive RSS news feeds, visit https://www.news.xerox.com. For open commentary, industry perspectives and views, visit http://www.linkedin.com/company/xerox or http://www.youtube.com/XeroxCorp.

Xerox^® is a trademark of Xerox in the United States and/or other countries.

XEROX HOLDINGS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF LOSS (UNAUDITED)

	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions, except per-share data)		2025			2024			2025			2024
Revenues
Sales	$	993		$	588		$	2,215		$	1,722
Services, maintenance, rentals and other⁽¹⁾		968			940			2,779			2,886
Total Revenues		1,961			1,528			4,994			4,608
Costs and Expenses
Cost of sales		788			390			1,650			1,117
Cost of services, maintenance, rentals and other⁽¹⁾		728			643			2,022			2,033
Research, development and engineering expenses		74			45			159			144
Selling, administrative and general expenses		477			370			1,223			1,160
Goodwill impairment		—			1,058			—			1,058
Restructuring and related costs, net		59			56			68			107
Amortization of intangible assets		30			10			50			30
Divestitures		—			—			(4	)		51
Other expenses, net		105			43			253			120
Total Costs and Expenses		2,261			2,615			5,421			5,820
Loss before Income Taxes⁽²⁾		(300	)		(1,087	)		(427	)		(1,212	)
Income tax expense		460			118			529			88
Net Loss		(760	)		(1,205	)		(956	)		(1,300	)
Less: Preferred stock dividends, net		(4	)		(4	)		(11	)		(11	)
Net Loss attributable to Common Shareholders	$	(764	)	$	(1,209	)	$	(967	)	$	(1,311	)

Basic Loss per Share	$	(6.01	)	$	(9.71	)	$	(7.67	)	$	(10.55	)
Diluted Loss per Share	$	(6.01	)	$	(9.71	)	$	(7.67	)	$	(10.55	)


(1)	Services, maintenance, rentals and other revenues include financing revenue generated from direct and indirectly financed Xerox equipment sale transactions of $32 million and $38 million for the three months ended September 30, 2025 and 2024, respectively, and $97 million and $118 million for the nine months ended September 30, 2025 and 2024, respectively. Cost of services, maintenance, rentals and other include the related cost of financing of $21 million and $26 million for the three months ended September 30, 2025 and 2024, respectively, and $66 million and $82 million for the nine months ended September 30, 2025 and 2024, respectively.
(2)	Referred to as "Pre-tax loss" throughout the remainder of this document.

XEROX HOLDINGS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)

	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)		2025			2024			2025			2024
Net Loss	$	(760	)	$	(1,205	)	$	(956	)	$	(1,300	)

Other Comprehensive (Loss) Income, Net
Translation adjustments, net		(42	)		192			292			140
Unrealized (losses) gains, net		(2	)		5			(8	)		4
Changes in defined benefit plans, net		35			(24	)		(42	)		18
Other Comprehensive (Loss) Income, Net		(9	)		173			242			162

Comprehensive Loss, Net	$	(769	)	$	(1,032	)	$	(714	)	$	(1,138	)

XEROX HOLDINGS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in millions, except share data in thousands)	September 30, 2025			December 31, 2024
Assets
Cash and cash equivalents	$	479		$	576
Accounts receivable (net of allowance of $75 and $69, respectively)		1,196			796
Billed portion of finance receivables (net of allowance of $3 and $2, respectively)		53			48
Finance receivables, net		553			608
Inventories		1,143			695
Other current assets		329			212
Total current assets		3,753			2,935
Finance receivables due after one year (net of allowance of $50 and $55, respectively)		950			1,089
Equipment on operating leases, net		300			245
Land, buildings and equipment, net		427			251
Intangible assets, net		954			236
Goodwill, net		2,182			1,937
Deferred tax assets		101			615
Other long-term assets		1,401			1,057
Total Assets	$	10,068		$	8,365
Liabilities and Equity
Short-term debt and current portion of long-term debt	$	354		$	585
Accounts payable		1,481			1,023
Accrued compensation and benefits costs		247			227
Accrued expenses and other current liabilities		1,317			784
Total current liabilities		3,399			2,619
Long-term debt		4,052			2,814
Pension and other benefit liabilities		1,150			1,088
Post-retirement medical benefits		168			154
Other long-term liabilities		705			386
Total Liabilities		9,474			7,061

Noncontrolling Interests		10			10

Convertible Preferred Stock		214			214

Common stock		128			124
Additional paid-in capital		1,171			1,137
Retained earnings		2,523			3,514
Accumulated other comprehensive loss		(3,457	)		(3,699	)
Xerox Holdings shareholders' equity		365			1,076
Noncontrolling interests		5			4
Total Equity		370			1,080
Total Liabilities and Equity	$	10,068		$	8,365

Shares of Common Stock Issued and Outstanding		128,018			124,435

XEROX HOLDINGS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)		2025			2024			2025			2024
Cash Flows from Operating Activities
Net Loss	$	(760	)	$	(1,205	)	$	(956	)	$	(1,300	)

Adjustments to reconcile Net loss to Net cash provided by operating activities
Depreciation and amortization		107			59			224			177
Provisions		19			13			67			92
Inventory-related purchase accounting adjustment - noncash		102			—			102			—
Net gain on sales of businesses and assets		(1	)		(2	)		(6	)		(3	)
Divestitures		—			—			(4	)		51
Stock-based compensation		7			9			33			38
Goodwill impairment		—			1,058			—			1,058
Restructuring and asset impairment charges		59			46			69			80
Payments for restructurings		(8	)		(11	)		(41	)		(58	)
Non-service retirement-related costs		20			25			57			74
Contributions to retirement plans		(56	)		(56	)		(123	)		(114	)
Decrease (increase) in accounts receivable and billed portion of finance receivables		3			50			(41	)		18
Decrease (increase) in inventories		37			12			(123	)		(136	)
Increase in equipment on operating leases		(36	)		(28	)		(88	)		(78	)
Decrease in finance receivables		126			97			338			496
(Increase) decrease in other current and long-term assets		(12	)		2			4			16
(Decrease) increase in accounts payable		(21	)		(55	)		4			(143	)
Increase (decrease) in accrued compensation		12			15			(39	)		(78	)
Increase (decrease) in other current and long-term liabilities		98			(31	)		58			(83	)
Net change in income tax assets and liabilities		444			108			479			44
Net change in derivative assets and liabilities		1			3			(1	)		9
Other operating, net		18			7			46			—
Net cash provided by operating activities		159			116			59			160
Cash Flows from Investing Activities
Cost of additions to land, buildings, equipment and software		(28	)		(9	)		(67	)		(27	)
Proceeds from sales of businesses and assets		26			8			56			27
Acquisitions, net of cash acquired		(718	)		—			(717	)		—
Other investing, net		(5	)		(6	)		(9	)		(26	)
Net cash used in investing activities		(725	)		(7	)		(737	)		(26	)
Cash Flows from Financing Activities
Net proceeds (payments) on debt		124			(42	)		670			(7	)
Purchases of capped calls		—			—			—			(23	)
Dividends		(7	)		(36	)		(65	)		(107	)
Payments to acquire treasury stock, including fees		—			—			—			(3	)
Other financing, net		1			4			(28	)		(9	)
Net cash provided by (used in) financing activities		118			(74	)		577			(149	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(2	)		4			5			(12	)
(Decrease) increase in cash, cash equivalents and restricted cash		(450	)		39			(96	)		(27	)
Cash, cash equivalents and restricted cash at beginning of period		985			551			631			617
Cash, Cash Equivalents and Restricted Cash at End of Period	$	535		$	590		$	535		$	590

Third Quarter 2025 Overview

Third quarter results were impacted by macroeconomic challenges. We experienced continued disruption associated with tariff and government funding-related uncertainty, which primarily affected transactional Print equipment revenues, and to a lesser extent, supplies revenue. Throughout the quarter, we observed continued delays in purchasing decisions among clients, particularly those reliant on federal, state and local government funding. General economic uncertainty also resulted in delays in purchases among our commercial client base and distributors. However, page volume trends remain consistent, and branded supplies usage was in line with expectations, both of which indicate unchanged demand for printed pages. Actions undertaken through Reinvention, have provided Xerox with a flexible, simplified operating structure, allowing the company to more quickly adapt in an uncertain operating landscape.

Equipment sales of $383 million in the third quarter 2025 increased 13.0% in actual currency, or 12.1% in constant currency¹, as compared to the third quarter 2024. Third quarter 2025 equipment sales included a 26.0-percentage point benefit from the recent acquisition of Lexmark. Total equipment installations increased approximately 55.0% including Lexmark, offset by legacy Xerox declines concentrated in the high-end and entry level equipment categories. Excluding Lexmark, equipment sales declined 13.0% in actual currency reflecting lower installations, including the exit of certain production print manufacturing operations in prior years. On a pro forma¹basis, third quarter 2025 revenue declined 16.4%, due to the impacts noted above, as well as backlog²fluctuations and timing of certain enterprise deals and OEM orders within Lexmark. Lexmark's equipment sales can be more volatile on a quarter-to-quarter basis, as a higher percentage comes from large channel and OEM partners.

Post-sale revenue of approximately $1.6 billion increased 32.7% in actual currency, or 31.3% in constant currency¹, as compared to third quarter 2024. Third quarter 2025 post-sale revenue included a 30.2-percentage point benefit and a 10.3-percentage point benefit from the acquisitions of Lexmark and ITsavvy, respectively. Excluding these acquisitions, post sale revenue declined 7.8-percentage points in actual currency reflecting lower managed print services³revenue, driven by lower outsourcing and print services, and lower supplies revenue. Post sale revenue was also adversely affected by intentional reductions in non-strategic revenue, such as paper and financing revenue, and the effects of geographic and offering simplification. These impacts were partially offset by growth of the legacy Xerox IT Solutions business and the benefits of currency. On a pro forma¹basis, third quarter 2025 revenue decreased 5.5%, due to the impacts noted above, and timing of certain enterprise deals within Lexmark.

Pre-tax loss of $300 million for the third quarter 2025 decreased by $787 million as compared to pre-tax loss of $1,087 million in the third quarter 2024. Pre-tax loss margin decreased 55.8% for the third quarter 2025 as compared to the third quarter 2024 and included a 1.6-percentage point benefit and a 3.0-percentage point adverse impact from the recent acquisitions of ITsavvy and Lexmark, respectively. The improvement in the third quarter 2025 is primarily due to the pre-tax non-cash goodwill impairment charge of $1.1 billion in the third quarter 2024, and benefits associated with Reinvention-related cost and productivity actions and recent pricing initiatives. These benefits were partially offset by lower gross profit, including the adverse impact related to our recent acquisition of Lexmark, unfavorable revenue mix, product cost increases and incremental tariff-related costs, as well as higher Other expenses, net, which included higher non-financing interest expense related to the recently completed borrowings in support of the Lexmark acquisition financing, repayment of existing borrowings, and general corporate purposes. In addition, selling, general and administrative expenses increased due to these recent acquisitions. On a pro forma¹ basis third quarter 2025 pre-tax loss decreased by $821 million as compared to pre-tax loss of $1,087 million in the third quarter 2024, due to the impacts noted above.

Adjusted¹ operating income of $65 million decreased by $15 million as compared to third quarter 2024 primarily due to lower gross profit, which includes higher product costs and incremental tariff-related costs, as well as unfavorable revenue mix driven by lower outsourcing revenue. These impacts were partially offset by benefits from the recent acquisitions of Lexmark and ITsavvy, productivity and cost savings related to the Company's Reinvention, as well as recent price increases which help mitigate higher tariff and product-related costs. On a pro forma¹ basis third quarter 2025 adjusted¹operating decreased $80 million, due primarily to the impacts noted above.

Xerox's 2025 guidance includes six months of activity associated with the recent Lexmark acquisition, which was effective July 1, 2025. We expect Revenue to grow 13% in constant currency¹, adjusted¹ operating income margin of approximately 3.5%, and free cash flow¹ of approximately $150 million in 2025. Adjusted¹operating income guidance reflects $100 million to $110 million of Lexmark-related contribution and approximately $35 million of incremental tariff-related costs, net of mitigation efforts.

Lexmark Acquisition

On July 1, 2025, Xerox Corporation completed its previously announced acquisition of all of the issued and outstanding equity securities of Lexmark International II, LLC (Lexmark) from Ninestar Group Company Limited (the Seller), for approximately $1.5 billion, which is inclusive of net debt and other assumed liabilities. Total consideration transferred included cash of approximately $811 million, as well as the assumption of Lexmark's debt of $323 million.

We continue to expect over $1/share of accretion associated with the Lexmark transaction, despite a slightly higher than expected cost of funding. Based on U.S. tariffs currently proposed, we expect no material impact from tariffs on Lexmark's results. Lexmark has a large manufacturing facility in Juarez, Mexico that can support all expected imports of branded product into the U.S. market on a USMCA compliant basis.

Reportable Segment Change

Beginning in the first quarter of 2025, the Company made a change to its reportable segments - Print and Other, and IT Solutions to align with a change in how the Chief Operating Decision Maker, our Chief Executive Officer, allocates resources and assesses performance against the Company's key growth strategies. Prior to this change, the company had two reportable segments - Print and Other, and XFS. As a result of this change, prior period reportable segment results have been conformed to reflect the Company's current reportable segments. See APPENDIX II - Reportable Segments.


(1)	Refer to the "Non-GAAP Financial Measures" section for an explanation of the non-GAAP financial measure.
(2)	Order backlog is measured as the value of unfulfilled sales orders, shipped and non-shipped, received from our customers waiting to be installed, including orders with future installation dates. It includes printing devices as well as IT hardware.
(3)	Previously known as contractual print services, and includes revenues from service, maintenance and rentals. IT solutions and digital services are not included in managed print services.

Financial Review

Revenues

	Three Months Ended September 30,												% of Total Revenue
(in millions)		2025			2024		% Change		CC % Change		Pro Forma⁽¹⁾ % Change		2025		2024
Equipment sales	$	383		$	339		13.0	%	12.1	%	(16.4	)%	20	%	22	%
Post sale revenue		1,578			1,189		32.7	%	31.3	%	(5.5	)%	80	%	78	%
Total Revenue	$	1,961		$	1,528		28.3	%	27.0	%	(7.8	)%	100	%	100	%

Reconciliation to Condensed Consolidated Statements of Loss:
Sales	$	993		$	588		68.9	%	67.9	%	(8.6	)%
Less: IT Products⁽²⁾		(165	)		(55	)	200.0	%	197.6	%	10.7	%
Less: Supplies, paper and other sales		(445	)		(194	)	129.4	%	129.7	%	(7.1	)%
Equipment Sales	$	383		$	339		13.0	%	12.1	%	(16.4	)%

Services, maintenance, rentals and other^(3),(4)	$	968		$	940		3.0	%	1.5	%	(7.1	)%
Add: IT Products⁽²⁾		165			55		200.0	%	197.6	%	10.7	%
Add: Supplies, paper and other sales		445			194		129.4	%	129.7	%	(7.1	)%
Post Sale Revenue	$	1,578		$	1,189		32.7	%	31.3	%	(5.5	)%

Segments
Print and Other	$	1,739		$	1,442		20.6	%	19.0	%	(9.8	)%	89	%	94	%
IT Solutions		226			86		162.8	%	161.3	%	12.4	%	11	%	6	%
Intersegment elimination ⁽⁵⁾		(4	)		—		NM		NM		NM		—	%	—	%
Total Revenue⁽⁶⁾	$	1,961		$	1,528		28.3	%	27.0	%	(7.8	)%	100	%	100	%


CC - See "Constant Currency" in the Non-GAAP Financial Measures section for a description of constant currency.
(1)	Reflects the inclusion of Lexmark and ITsavvy estimated results from July 1, 2024 through September 30, 2024. Refer to the "Non-GAAP Financial Measures" section for an explanation of the non-GAAP financial measure.
(2)	IT Products reflect IT hardware, software solutions and services, provided by the IT Solutions segment. Refer to Reportable Segments - IT Solutions, for further information.
(3)	Services, maintenance, rentals and other revenues include financing revenue generated from direct and indirectly financed Xerox equipment sale transactions of $32 million and $38 million for the third quarter 2025 and 2024, respectively.
(4)	Services, maintenance, rentals and other revenue include IT services support of $57 million and $31 million for the third quarter 2025 and 2024, respectively, provided by our IT Solutions segment.
(5)	Reflects primarily IT hardware, software solutions and services, sold by the IT Solutions segment to the Print and Other segment.
(6)	Refer to Appendix II, Reportable Segments, for definitions.

Costs, Expenses and Other Income

Summary of Key Financial Ratios

The following is a summary of key financial ratios used to assess our performance:

	Three Months Ended September 30,
(in millions)		2025			2024		B/(W)				Pro Forma⁽¹⁾⁽²⁾ B/(W)
Gross Profit	$	445		$	495		$	(50	)		$	(236	)
RD&E		74			45			(29	)			3
SAG		477			370			(107	)			(7	)

Equipment Gross Margin		26.1	%		28.5	%		(2.4	)	pts.		11.6		pts.
Post sale Gross Margin		21.8	%		33.5	%		(11.7	)	pts.		(8.0	)	pts.
Total Gross Margin		22.7	%		32.4	%		(9.7	)	pts.		(9.3	)	pts.
RD&E as a % of Revenue		3.8	%		2.9	%		(0.9	)	pts.		(0.2	)	pts.
SAG as a % of Revenue		24.3	%		24.2	%		(0.1	)	pts.		(2.2	)	pts.

Pre-tax Loss	$	(300	)	$	(1,087	)	$	787			$	821
Pre-tax Loss Margin		(15.3	)%		(71.1	)%		55.8		pts.		37.4		pts.

Adjusted⁽¹⁾ Operating Income	$	65		$	80		$	(15	)		$	(80	)
Adjusted⁽¹⁾ Operating Income Margin		3.3	%		5.2	%		(1.9	)	pts.		(3.5	)	pts.


(1)	Refer to the "Non-GAAP Financial Measures" section for an explanation of the non-GAAP financial measure.
(2)	Reflects the inclusion of Lexmark and ITsavvy estimated results from July 1, 2024 through September 30, 2024.

Other Expenses, Net

	Three Months Ended September 30,
(in millions)		2025			2024
Non-financing interest expense	$	80		$	31
Interest income		(3	)		(3	)
Non-service retirement-related costs		20			25
Currency losses, net		5			2
Transaction and related costs, net		—			(15	)
All other expenses, net		3			3
Other expenses, net	$	105		$	43


(1)	Third quarter 2025 non-financing interest expense of $80 million was $49 million higher than third quarter 2024. The increase reflects recently completed borrowings in support of the Lexmark acquisition financing, repayment of existing borrowings, and general corporate purposes.

Reportable Segments

Our business is organized to ensure we focus on efficiently managing operations while serving our customers and the markets in which we operate. We have two operating and reportable segments – Print and Other and IT Solutions.

Segment Review

	Three Months Ended September 30,
(in millions)	Print and Other			IT Solutions			Total Segment			Intersegment Elimination⁽¹⁾			Corporate Other⁽²⁾			Total
2025
Revenues	$	1,739		$	226		$	1,965		$	(4	)	$	—		$	1,961
% of Total Revenue		88	%		12	%		100	%
Segment Profit	$	64		$	18		$	82			—		$	(17	)	$	65
Segment Margin⁽³⁾		3.7	%		8.1	%											3.3	%

2024
Revenues	$	1,442		$	86		$	1,528		$	—		$	—		$	1,528
% of Total Revenue		94	%		6	%		100	%
Segment Profit	$	103		$	—		$	103			—		$	(23	)	$	80
Segment Margin⁽³⁾		7.1	%		—	%											5.2	%

2024 Pro Forma⁽⁴⁾

Xerox Releases Third-Quarter Results