NASDAQ$XRX

Xerox Corp · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

Xerox's Q4 2022 financial performance improved year-over-year, driven by resilient demand and supply chain improvements.

Xerox Holdings Corporation reported Q4 2022 revenue of $1.94 billion, up 9.2% year-over-year, and adjusted EPS of $0.89, up $0.55 year-over-year. The company's Q4 performance was driven by strong demand and improvements in supply chain conditions. The company guides to improved profitability in 2023.

  • Revenue of $1.94 billion, up 9.2 percent year-over-year or up 13.9 percent in constant currency.
  • GAAP earnings per share (EPS) of $0.74, up $4.71 year-over-year.
  • Adjusted EPS of $0.89, up $0.55 year-over-year.
  • Adjusted operating margin of 9.2 percent, up 440 basis points year-over-year.

Headline financials

Total Revenue

$1.94B

Previous: $1.78B+9.2%
EPS (adj)

$0.89

Previous: $0.34+161.8%
Revenue Growth Constant Currency

13.9%

Previous: -7.4%+287.8%
Adjusted Operating Margin

9.2%

No prior period
Capital Expenditures

$12M

Previous: $8M+50.0%
Free Cash Flow

$168M

Previous: $182M-7.7%
Net Income

$122M

Previous: -$674M+118.1%
Operating Income

$146M

Previous: $86M+69.8%
Gross Profit

$675M

Previous: $584M+15.6%
Cash & Equivalents

$1.05B

Previous: $1.84B-43.2%
Total Assets

$11.5B

Previous: $13.2B-12.7%
Stock-Based Comp

$12M

Previous: $10M+20.0%

Revenue & EPS history

Xerox · Revenue · Quarterly

$1.94B

Q4 2022+9.2%vs Q4 2021
Beat estimate in 7 of 15 quarters(47%)
ActualEstimate

Revenue by segment

Xerox · $1.78B total across 2 segments · Q4 2021

  • Post Sale Revenue
    $1.39B-1.9%
  • Equipment Sales
    $384M-24.7%

Forward guidance

Xerox provided guidance for 2023 including revenue growth, adjusted operating margin, and free cash flow.

Tailwinds

  • Revenue growth: flat to down low-single-digits in constant currency
  • Adjusted Operating Margin: at least 4.7%
  • Free cash flow: at least $500 million
  • Free cash flow guidance includes the net benefit of a receivable funding agreement recently signed with an affiliate of HPS Investment Partners.
  • Expect profitability to improve further in 2023 as we realize the benefits of price and cost actions taken in 2022, further improvements in product availability, lower logistics costs and additional operating efficiencies.

Headwinds

  • Macroeconomic uncertainty extends through this year.
  • 2022 was a challenging year as revenue and profitability was impacted by an uncertain and unpredictable macroeconomic environment, which included increasing inflation and higher interest rates, supply chain challenges, currency disruption and a war in Ukraine.
  • Total Revenue is expected to be flat to down low-single-digits in constant currency1 in 2023.
  • We will continue working alongside our clients to develop and deploy essential workplace solutions and services.
  • We expect adjusted1 operating income margin to be at least 4.7%, an 80 basis point increase over 2022 levels

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2022

Historical avgQ4 2022

-0.7%

Avg return

Earnings day

+0.7%

Avg return

5 days after

+1.7%

Avg return

30 days after

50%

32 / 64 earnings

Positive

+39.2%

Q1 2026

Best reaction

-19.9%

Q3 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+39.2%+68.2%+106.4%
Q4 2025-13.0%-6.9%-22.7%
Q3 2025-1.7%-8.5%-26.7%
Q1 2025-1.6%+22.7%+10.9%
Q4 2024-5.8%-12.0%-28.6%
Q3 2024-19.9%-19.4%-11.9%
Q2 2024-6.4%-5.9%-8.4%
Q1 2024-12.4%-14.7%-16.0%
Q4 2023+15.9%+15.9%+12.4%
Q3 2023-10.2%-9.6%+1.1%
Q2 2023+8.3%+2.7%-0.1%
Q1 2023+13.2%+15.3%+2.5%
Q4 2022-3.4%-6.0%-6.5%
Q3 2022-9.0%-9.5%-1.0%
Q2 2022+7.2%+9.9%+15.6%
Q1 2022-13.7%-12.0%-13.5%
Q4 2021-4.1%-2.2%-5.7%
Q3 2021-13.5%-13.5%-1.8%
Q2 2021+3.2%+2.2%-5.4%
Q1 2021-3.9%-3.7%-6.5%
Q4 2020+0.6%+1.3%+22.2%
Q3 2020-8.9%-8.1%+23.6%
Q2 2020+0.3%+5.2%+20.7%
Q1 2020+8.2%-4.4%-5.7%
Q4 2019+4.8%+1.5%-3.5%
Q3 2019+10.8%+8.7%+26.0%
Q2 2019-5.4%-9.9%-15.2%
Q1 2019-4.1%-1.0%-5.3%
Q4 2018+15.9%+17.4%+27.2%
Q3 2018+3.7%+3.7%-4.6%
Q2 2018+3.3%+4.8%+10.6%
Q1 2018-3.4%-3.4%-6.9%
Q4 2017+0.2%-4.0%-8.0%
Q3 2017-7.9%-8.4%-13.9%
Q2 2017+6.1%+5.1%+5.2%
Q1 2017+0.6%+1.8%-1.0%
Q4 2016+1.7%+2.9%+4.9%
Q3 2016+2.1%-0.6%-2.0%
Q2 2016+2.3%+0.3%-1.8%
Q1 2016-12.2%
Q4 2015+2.1%
Q3 2015-10.1%
Q2 2015-1.8%
Q1 2015-11.6%
Q4 2014-1.3%
Q3 2014-3.2%
Q2 2014+2.0%
Q1 2014+4.3%
Q4 2013-9.8%
Q3 2013-9.5%
Q2 2013-1.4%
Q1 2013-2.7%
Q4 2012+7.4%
Q3 2012+0.1%
Q2 2012+0.0%
Q1 2012+0.9%
Q4 2011+3.0%
Q3 2011-8.5%
Q2 2011+4.5%
Q1 2011+2.1%
Q4 2010+2.0%
Q3 2010+2.0%
Q2 2010-4.4%
Q1 2010+3.1%

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