Xerox (XRX) Citi's 2024 Global TMT Conference summary

Demand and revenue outlook

• Underlying demand has remained consistent, with year-over-year order growth and no change to guidance for the rest of the year.

• Revenue trajectory is improving: Q1 was -12%, Q2 -10%, with expectations for low single-digit decline in Q3 and growth in Q4, setting positive momentum for 2025.

• Backlog situation is clearer, and pipeline trends are positive, supporting confidence in growth.

• Revenue renewal rates have been above 100% for five consecutive quarters, indicating strong client retention and upselling.

Business transformation and strategy

• Project Reinvention is a comprehensive overhaul of processes, systems, and organizational structure, aiming for a consumer-like experience and automation.

• The program targets $300 million in incremental operating income over 2024–2026, with $400 million of $700 million in identified actions already underway.

• Operating margin has improved from 4% in 2022 to a guided 6.5% in 2024, with a goal of reaching 10%.

• Reinvention includes reducing complexity, consolidating systems, and leveraging technology for scalable growth.

Print, IT, and digital services

• Print demand is expected to see a low single-digit decline over several years, but value-added services and workflow solutions are driving productivity and revenue.

• IT and digital services are key growth drivers, with IT services being the larger segment; both are growing at high single digits and targeted to double their revenue contribution from 10% to 20%.

• Investments in these areas are expected to be margin-accretive, aiming for service margins to match or exceed print margins.