Xerox (XRX) Q3 2026 Earnings Report
MX:XRX Q3 2026 EPS Results
- Actual EPS
- MXN 0.38
- Consensus EPS
- -MXN 1.96
- Beat/Miss
- Beat by +MXN 2.34
- One Year Ago EPS
- MXN 3.78
MX:XRX Q3 2026 Revenue Results
- Actual Revenue
- MXN 35.27B
- Expected Revenue
- MXN 35.21B
- Beat/Miss
- Beat by +MXN 66.31M
- YoY Revenue Growth
- -4.74%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/29/2026
- Time
- Before Open
- Conference Call
- Thursday, October 29, 2026
Xerox's next earnings date is estimated for January 28, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call conveyed a mixed but predominantly negative near-term outlook. Xerox reported meaningful operational progress, including improved print trends, organic equipment growth, higher margins, lower leverage, Lexmark synergies and early service-efficiency gains. However, these positives were outweighed by reduced adjusted operating income and free cash flow guidance, dividend suspension, significant input-cost and tariff pressure, weaker market demand, IT Solutions underperformance, a large goodwill impairment and an extended leverage timeline.
Xerox maintained full year revenue guidance of approximately $7.6 billion, while reducing adjusted operating income guidance to $450 million to $475 million from $555 million to $605 million previously and free cash flow guidance to $50 million to $100 million from approximately $250 million; the outlook includes an approximate $60 million headwind for the year from memory and oil, an ongoing tariff impact of approximately $90 million in 2026, $300 million of cash from finance receivable sales versus $335 million, about $30 million of tariff refunds in 2026 with the remaining $50 million in 2027, and year-end gross and net leverage of approximately 5.6x and 4.7x trailing 12-month EBITDA, respectively, versus the prior expectation of below 5 and 4x. For 2027, Xerox expects approximately $100 million of additional year-over-year Lexmark savings, input costs to be a larger headwind than in 2026, and pricing actions beginning in the first quarter, while it will size the headwind and cost programs with its 2027 outlook on its fourth quarter call.
- Revenue Decline Improved SequentiallyQ3 revenue was $1.87 billion, declining less than 5% year-over-year and representing a 180 basis point pro forma sequential improvement from the prior quarter. The company maintained full-year revenue guidance of approximately $7.6 billion.
- Adjusted Operating Margin ExpandedAdjusted operating margin was 6.6%, up 330 basis points year-over-year. The improvement was driven by higher gross margin and lower operating expenses.
- Operating Expenses DeclinedOperating expenses were $73 million lower than last year, reflecting restructuring and integration savings, lower bad debt and marketing expense, and a lower bonus accrual.
- Organic Equipment Revenue Returned to GrowthEquipment revenue grew 3% in Q3, marking the first quarter of year-over-year organic equipment sales growth in more than three years. Equipment installs increased 9%.
- Entry Equipment Growth and Portfolio StrengthEntry equipment installs increased 16% and equipment revenue increased 21%. For the first time since Xerox began reporting the categories separately, entry equipment revenue exceeded midrange revenue, reflecting the market shift toward entry and the strength of the portfolio gained through the Lexmark acquisition.
- Production Printing MomentumProduction installs increased 13% and production equipment revenue increased 14%. Production growth more than offset the 15% decline in midrange equipment revenue. Xerox expects three new production platforms announced at Printing United to enter the market next year.
- Positioning in Production, Packaging and LabelsThrough its production portfolio and Xeikon partnership, Xerox believes it is positioned to gain share in the approximately $9 billion growing production market and is entering its fastest-growing segments.
- Print Revenue Trends ImprovedPrint and Other revenue declined 3% in Q3, improving from a 10% pro forma decline a year ago. Print and Other segment margin was 8.1%, up 440 basis points year-over-year.
- Gross Margin and Print Segment Profitability ImprovedAdjusted gross margin was 29.5%, up 60 basis points year-over-year, including $20 million of IP licensing income that contributed approximately 70 basis points. Print and Other adjusted gross margin was 30.6%, up 60 basis points.
- Leverage Improved in the QuarterGross and net leverage declined to 5.4x and 4.7x trailing 12-month EBITDA, respectively, from 5.9x and 5.1x last quarter. The company stated that reducing debt remains its capital allocation priority.
- Debt Exchange Reduced Principal and Extended MaturitiesXerox announced an exchange of approximately $174 million of August 2028 senior notes for first lien senior secured notes due October 2030 and common equity. The transaction reduces total debt principal by approximately $53 million. Approximately $382 million of the August 2028 notes will remain outstanding, down from $750 million at the beginning of the year.
- Liquidity and Covenant ComplianceThe company ended the quarter with $530 million of cash, cash equivalents and restricted cash, including approximately $412 million of unrestricted cash. Together with approximately $314 million of ABL borrowing base, net of letters of credit, total liquidity was roughly $726 million. Xerox stated that it is in compliance with all covenants and has sufficient liquidity to run the business and meet its obligations.
- Lexmark Synergies Remain on TrackXerox expects approximately $100 million of additional year-over-year Lexmark integration savings in 2027. The company is also expanding global capability centers, which represented about 15% of its workforce, up from 11% at the start of the year.
- Service Optimization Strategy Shows Early ResultsA little over half of service calls reaching the client experience center are resolved without sending a technician, with a target of 70%. The 9 Series has generated about 50% fewer service calls than the prior generation.
- Technology Stack and Installed Base Support Service OpportunityXerox stated that it now owns the full technology stack and has nearly 9 million devices in the field. Its service, maintenance and rentals business generates more than $3 billion of revenue annually, and the company is using device design, sensors, AI failure detection and remote resolution to reduce service disruption and truck rolls.
- IT Solutions Backlog and Platform Remain StrongIT Solutions backlog was up 24%, and the company entered Q4 with a larger pipeline. Xerox highlighted its full life-cycle offering, engineering capabilities, partnerships with Microsoft and leading OEMs, and scalable automated delivery model.
- Xerox Financial Services Receivables Were ReducedNet finance receivables declined from approximately $3.1 billion in 2022 to approximately $1.2 billion today through forward-flow and back-book sales. The company stated that the strategy accelerated cash realization and reduced the debt needed to support customer financing.
- Fourth-Quarter Execution and Cost Actions InitiatedXerox implemented weekly deal-by-deal reviews, committed installation dates for late-stage opportunities, and a freeze on discretionary spending, including nonessential travel and hiring outside revenue-generating roles. For 2027, the company is pursuing pricing actions, organizational simplification, greater use of global capability centers, distribution-center and real-estate consolidation, vendor renegotiations and procurement savings.
MX:XRX Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Jan 28, 2027 | 2026 (Q4) | 5.19- | -1.89 | ― | ― |
| Oct 29, 2026 | 2026 (Q3) | -1.960.38 | 3.78 | -90.00% (-3.40) | |
| Jul 30, 2026 | 2026 (Q2) | -2.287.18 | -12.08 | 159.38% (+19.26) | |
| Apr 30, 2026 | 2026 (Q1) | -5.15-8.12 | -1.13 | -616.67% (-6.99) | |
| Jan 29, 2026 | 2025 (Q4) | 1.83-1.89 | 6.8 | -127.78% (-8.69) | |
| Oct 30, 2025 | 2025 (Q3) | -3.343.78 | 4.72 | -20.00% (-0.94) | |
| Jul 31, 2025 | 2025 (Q2) | 1.30-12.08 | 5.48 | -320.69% (-17.56) | |
| May 01, 2025 | 2025 (Q1) | -0.74-1.13 | 1.13 | -200.00% (-2.27) | |
| Jan 28, 2025 | 2024 (Q4) | 9.956.80 | 8.12 | -16.28% (-1.32) | |
| Oct 29, 2024 | 2024 (Q3) | 9.594.72 | 8.69 | -45.65% (-3.97) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.