Xerox Holdings Corp Announces Positive First-Quarter Results for 2026
Xerox Holdings Corporation (NASDAQ: XRX) has released its financial results for the first quarter of 2026, showcasing significant improvements in revenue, profit margins, and operational efficiency. CEO Louie Pastor expressed optimism about the company's trajectory, emphasizing the importance of stabilizing revenue and enhancing profitability.
1. Key Highlights from Q1 2026
In a statement, Pastor noted, “This quarter’s results demonstrated tangible progress as revenue and profit trajectory improved, adjusted operating margin expanded, and we further enhanced our liquidity.” He reaffirmed the company’s 2026 guidance, reflecting a strong belief in Xerox's ongoing recovery and future potential.
Strategic Milestones Achieved
Xerox reported several strategic milestones for the first quarter:
- Lexmark Integration Synergies: The company is on track to achieve at least $300 million in integration synergies from its Lexmark acquisition.
- Increased Sales Pipeline: The print sales pipeline has shown a material increase compared to the same period last year.
- Production Installs: There was a noteworthy 31% year-over-year growth in production installations, attributed in part to the launch of the Proficio product line.
- IT Solutions Growth: Bookings and billings in the IT Solutions segment grew by 32% and 21%, respectively.
- Liquidity Enhancement: Xerox successfully raised $450 million through a newly formed IP joint venture with TPG Angelo Gordon, and repurchased $101 million face value of its 2028 Senior Notes.
2. Financial Performance Overview
The financial results for Q1 2026 indicate a solid upward trend across various metrics:
| (in millions, except per share data) | Q1 2026 | Q1 2025 | B/(W) YOY |
|---|---|---|---|
| Revenue | $1,846 | $1,457 | 26.7% AC |
| Gross Profit | $549 | $426 | $123 |
| Gross Margin | 29.7% | 29.2% | 50 bps |
| Pre-Tax Loss | $(73) | $(67) | $(6) |
| Operating Income - Adjusted | $72 | $22 | $50 |
| GAAP Diluted Loss per Share | $(0.84) | $(0.75) | $(0.09) |
Revenue and Profit Insights
Xerox’s total revenue reached $1.846 billion, marking a substantial 26.7% increase compared to the $1.457 billion reported in Q1 2025. This growth is attributed to strong performance in the Print and Other segment, which generated $1.692 billion in revenue—up 30.8% year-over-year.
The gross profit also saw an increase, amounting to $549 million compared to $426 million a year prior, while the gross margin improved slightly to 29.7%. However, the company reported a pre-tax loss of $73 million, widening from the previous year's loss of $67 million.
Segment Performance
The breakdown of revenue and profit by segment reveals:
| (in millions) | Q1 2026 | Q1 2025 | B/(W) YOY |
|---|---|---|---|
| Print and Other | $1,692 | $1,294 | 30.8% |
| IT Solutions | $156 | $164 | (4.9)% |
| Total Profit | $72 | $22 | NM |
The "Print and Other" segment demonstrated remarkable growth, while the "IT Solutions" segment experienced a slight decline in revenue.
3. Future Outlook
With the successful implementation of strategic initiatives and a robust sales pipeline, Xerox appears to be on a promising path toward recovery. As CEO Pastor stated, the company is “closer to an inflection point than the external narrative suggests.” The reaffirmation of 2026 guidance signals confidence in ongoing efforts to stabilize revenue and enhance profitability.
In summary, Xerox’s Q1 2026 results reflect a positive trajectory in its financial performance, driven by strategic growth initiatives and operational improvements. The company's focus on integration synergies and expanding its product offerings positions it well for future success in an evolving market.
