Xerox Holdings Corporation reported first‑quarter 2026 revenue of $1.85 billion, a 26.7% year‑over‑year increase and 23.6% in constant currency. Adjusted operating income rose to $72 million, and the adjusted operating margin expanded to 3.9%, a 240‑basis‑point lift over the prior year, driven by higher demand in the IT Solutions segment and stronger post‑sale services that offset a decline in legacy print equipment sales.
The company posted an adjusted net loss per share of $‑0.43, missing the consensus estimate of $‑0.27. A normalized adjusted net loss of $‑0.11 beat the estimate of $‑0.28, but the overall loss reflects higher interest expense and cost inflation that weighed on profitability. The EPS miss underscores the continued pressure on margins even as revenue grows.
Segment performance highlighted the impact of the Lexmark acquisition. The Print and Other segment generated $1.692 billion in revenue and $87 million in profit, while the IT Solutions segment contributed $156 million in revenue and $6 million in profit. The acquisition has been a key driver of the 26.7% revenue growth, with IT Solutions growth offsetting the decline in legacy print sales.
Xerox reaffirmed its full‑year 2026 outlook, projecting revenue above $7.5 billion, adjusted operating income of $450–$500 million, and free cash flow of approximately $250 million. The guidance signals management confidence in sustaining revenue momentum and improving profitability through cost discipline and integration synergies.
Market reaction was strongly positive; the stock surged 27.41% in pre‑market trading, driven by the revenue beat and the positive impact of the Lexmark integration. Investors expressed optimism about the company’s trajectory despite the EPS miss.
CEO Louie Pastor emphasized the company’s progress, noting that the quarter’s results demonstrate tangible improvement in revenue and profit trajectory, expanded operating margin, and enhanced liquidity. He added that the company is closer to an inflection point than external narratives suggest, reflecting confidence in the long‑term strategy.
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