Xerox (XRX) Investor presentation summary

Strategic transformation and growth initiatives

• Multi-year transformation aims for revenue stabilization, sustainable efficiencies, and double-digit adjusted operating income margin, supported by the strategic acquisitions of ITsavvy and Lexmark.

• Lexmark acquisition accelerates reinvention, expected to deliver over $300 million in gross cost synergies and is immediately accretive to adjusted EPS and free cash flow.

• Expansion beyond print into IT Solutions and Digital Services, now comprising over 10% of pro forma revenue.

• Capital allocation prioritizes debt reduction while maintaining competitive investor yield.

• Operational simplification, commercial optimization, and geographic streamlining are key pillars of the reinvention journey.

Recent acquisitions and integration

• ITsavvy acquisition in November 2024 for $400 million doubled IT Solutions revenue and expanded market coverage, with immediate accretion to adjusted EPS and free cash flow.

• Lexmark acquisition in July 2025 for $1.5 billion enhances competitiveness in A4 print, adds APAC exposure, and brings 97% renewal rates in managed print services.

• Integration workstreams focus on operational simplification, commercial optimization, and cross-selling opportunities, targeting over $1 billion in identified savings and profit improvement.

• More than half of expected savings and profit improvements from synergies and reinvention remain unrealized as of September 2025.

Financial performance and outlook

• Combined pro forma revenue for the trailing twelve months ended September 2025 is $8.1 billion, with over 65% from recurring sources and more than 10% from IT and Digital Solutions.

• Adjusted operating margin guidance for FY 2025 is approximately 3.5%, with targeted leverage below 3x gross debt to adjusted EBITDA.

• Free cash flow is expected to be negative $150 million in FY 2025, reflecting integration and transformation costs.

• Lexmark's 2024 revenue was $2.2 billion with a 13% adjusted EBITDA margin; ITsavvy contributed $458 million in 2024 revenue.

• XFS financing business returned to a captive model, expected to generate over $700 million in incremental free cash flow through 2027.