Conduent (CNDT) Q4 2025 earnings summary

Executive summary

• New CEO outlined a turnaround strategy emphasizing speed, financial discipline, cost reduction, portfolio rationalization, and organizational simplification.

• Adjusted revenue for Q4 2025 was $770M and for FY 2025 was $3,042M, reflecting a year-over-year decline of 4.2%.

• Adjusted EBITDA for Q4 2025 was $50M and for FY 2025 was $164M, with margins of 6.5% and 5.4% respectively, showing significant year-over-year improvement.

• New business signings (ACV) reached $152M in Q4 and $517M for the full year, indicating strong sales activity.

• Analyst Day planned to provide further strategic details and execution plans.

Financial highlights

• Adjusted revenue declined 4.2% year-over-year, primarily due to lower volumes and lost business, partially offset by new business and higher equipment sales in Transportation.

• Adjusted EBITDA increased 32.3% year-over-year, driven by cost optimization, legal cost recovery, and higher margin non-recurring revenue in Commercial.

• Adjusted free cash flow for FY 2025 was $(130)M, with Q4 at $28M.

• Capex as a percentage of revenue was 3.4% for the year.

• Q4 GAAP net loss was $33M; full-year net loss was $170M, primarily due to prior-year divestiture gains.

Outlook and guidance

• Full-year 2026 revenue growth expected in government and transportation segments.

• Commercial segment not expected to grow in 2026 but is on a positive trajectory for 2027.

• Guidance for 2026 and steady-state margin targets (8-10% EBITDA margin) to be provided in Q1.

• Free cash flow is a top priority, with a focus on turning positive in 2026.

• Management targets continued margin expansion and cost structure improvements.