Xerox (NASDAQ:XRX) Posts Quarterly Earnings Results, Beats Expectations By $0.09 EPS

Xerox (NASDAQ:XRX) announced its earnings results on Thursday. The information technology services provider reported $0.02 earnings per share for the quarter, beating analysts’ consensus estimates of ($0.07) by $0.09, FiscalAI reports. The company had revenue of $1.87 billion during the quarter. Xerox had a positive return on equity of 17.61% and a negative net margin of 11.93%. The business’s quarterly revenue was down 4.7% compared to the same quarter last year. During the same quarter last year, the business posted $0.20 earnings per share.

Here are the key takeaways from Xerox’s conference call:

• Xerox lowered 2026 adjusted operating income guidance to $450–$475 million from $555–$605 million and cut free cash flow guidance to $50–$100 million from approximately $250 million. The company cited higher memory, oil and tariff-related costs, unfavorable equipment mix, weaker print-market demand and IT Solutions underperformance.
• The board suspended common and preferred dividends, preserving approximately $28 million in annual cash for liquidity and debt reduction. Year-end gross leverage is now expected at about 5.6x, versus the prior target of below 5x, extending the timeline for deleveraging.
• Print trends improved, with Q3 equipment revenue rising 3% organically—the first year-over-year growth in more than three years—and installs increasing 9%. Entry and production equipment growth offset mid-range declines, leading management to believe Xerox gained market share.
• IT Solutions revenue declined 17% year over year and segment margin fell to 4.4%, as slower sales-force ramp-up, delayed customer decisions and tighter supplier terms reduced conversion. Management expects improvement in Q4 but acknowledged that the business requires further work.
• Xerox announced a debt exchange covering approximately $174 million of 2028 notes, reducing total debt by about $53 million and extending nearly one-third of those maturities to 2030. Management also highlighted roughly $100 million of incremental Lexmark synergies expected in 2027, alongside additional pricing and cost-reduction initiatives.

Xerox Stock Down 37.1%

XRX stock traded down $1.03 during mid-day trading on Thursday, hitting $1.75. 18,343,596 shares of the company were exchanged, compared to its average volume of 4,267,547. The firm has a market cap of $230.46 million, a P/E ratio of -0.24 and a beta of 2.45. Xerox has a 1-year low of $1.19 and a 1-year high of $3.78. The company has a debt-to-equity ratio of 12.58, a quick ratio of 0.85 and a current ratio of 1.18. The firm’s 50 day simple moving average is $3.03 and its 200 day simple moving average is $2.54.

Xerox Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Friday, October 30th. Stockholders of record on Wednesday, September 30th will be issued a dividend of $0.0250 per share. This represents a $0.10 annualized dividend and a dividend yield of 5.7%. The ex-dividend date is Wednesday, September 30th. Xerox’s payout ratio is -1.36%.

Institutional Trading of Xerox

A number of institutional investors have recently modified their holdings of the company. Paradigm Capital Management Inc. NY bought a new position in shares of Xerox in the 2nd quarter valued at about $5,626,000. Renaissance Technologies LLC raised its stake in shares of Xerox by 926.4% during the 1st quarter. Renaissance Technologies LLC now owns 645,624 shares of the information technology services provider’s stock worth $833,000 after purchasing an additional 582,724 shares in the last quarter. Squarepoint Ops LLC raised its stake in shares of Xerox by 0.6% during the 2nd quarter. Squarepoint Ops LLC now owns 584,825 shares of the information technology services provider’s stock worth $1,831,000 after purchasing an additional 3,689 shares in the last quarter. Gamco Investors INC. ET AL grew its stake in shares of Xerox by 1.8% in the first quarter. Gamco Investors INC. ET AL now owns 564,000 shares of the information technology services provider’s stock valued at $728,000 after buying an additional 9,800 shares in the last quarter. Finally, Bank of New York Mellon Corp bought a new position in shares of Xerox in the second quarter valued at $1,313,000. 85.36% of the stock is currently owned by institutional investors.

Key Stories Impacting Xerox

Here are the key news stories impacting Xerox this week:

• Positive Sentiment: Xerox announced an exchange transaction covering approximately $174 million of senior notes due in 2028. The deal would extend maturities to 2030, reduce debt principal by about $53 million and preserve cash, supporting the company’s balance-sheet and liquidity efforts. Xerox Announces Exchange Transaction to Extend Portion of 2028 Debt Maturities and Reduce Overall Debt
• Positive Sentiment: Third-quarter adjusted earnings surpassed Wall Street expectations. Reports placed adjusted EPS at approximately $0.02 to $0.06 per share, compared with consensus expectations for a $0.07 loss. Revenue of roughly $1.87 billion also exceeded estimates, although it remained below the prior-year period. Xerox Holdings Corporation Q3 Earnings and Revenues Surpass Estimates
• Neutral Sentiment: The company maintained its revenue outlook, but third-quarter sales were approximately $1.87 billion, down 4.7% year over year. This indicates that the earnings beat was driven more by cost control and other factors than by renewed top-line growth. Xerox Posts Q3 2026 Sales In Line With Estimates
• Negative Sentiment: Xerox lowered its fiscal 2026 adjusted-income and free-cash-flow forecasts. The guidance reduction outweighed the quarterly earnings beat and raised concerns about profitability, cash generation and the company’s ability to reduce its substantial debt burden. Why Is Xerox Stock Falling Thursday?
• Negative Sentiment: Third-quarter results showed a wider loss on a reported basis, with earnings falling from $0.20 per share a year earlier. Xerox continues to face negative net margins, declining revenue and elevated leverage, making the weaker outlook particularly concerning for investors. Xerox Q3 Loss Widens and Cuts FY26 Adjusted Income View
• Negative Sentiment: Options activity was unusually bearish, with investors purchasing 8,941 put options—about 192% above typical volume—indicating increased demand for downside protection or speculative bets against XRX.

Analyst Ratings Changes

Several brokerages have weighed in on XRX. Citigroup cut Xerox from a “neutral” rating to a “sell” rating and dropped their price objective for the stock from $3.45 to $2.50 in a report on Thursday, October 8th. Noble Financial assumed coverage on shares of Xerox in a research report on Tuesday, August 18th. They set an “outperform” rating and a $5.00 price target for the company. Weiss Ratings reissued a “sell (d-)” rating on shares of Xerox in a research note on Thursday, October 22nd. Finally, Needham & Company LLC set a $5.00 price objective on shares of Xerox in a report on Tuesday, August 18th. One investment analyst has rated the stock with a Buy rating, one has given a Hold rating and two have issued a Sell rating to the stock. Based on data from MarketBeat, the company currently has an average rating of “Reduce” and an average target price of $4.17.

About Xerox

Xerox Holdings Corporation (NASDAQ:XRX) is a technology and workplace solutions company that provides printing, document management and digital services to businesses and other organizations. The company serves customers across a range of industries, including government, education, healthcare, financial services and professional services.

Xerox offers office printers, multifunction devices, production printers and related supplies, software and support services. Its portfolio also includes document workflow and content-management solutions designed to help organizations digitize, automate and manage business processes.