Xerox Slashes Full-Year Guidance and Suspends Dividends After Q3 Miss on Profitability and Cash Flow

Xerox Holdings Corporation reported third-quarter 2026 revenue of $1.87 billion, down 4.7 percent year over year and roughly in line with analyst expectations, but the company simultaneously cut its full-year adjusted operating income and free cash flow guidance and suspended both its common and preferred dividends, sending shares down roughly 38 percent on October 29.

On an adjusted basis, Xerox earned $0.02 per share in the quarter, well ahead of the consensus estimate of negative $0.12, as adjusted operating income rose $59 million year over year to $124 million and adjusted operating margin expanded 330 basis points to 6.6 percent. Print equipment revenue grew and total equipment installations rose 9 percent, driven by gains in entry and high-end categories. Post-sale revenue fell 4.5 percent in constant currency, weighed down by lower service, managed print, supplies, and financing revenue. GAAP net loss was $(1.015) billion, or $(7.73) per share, a deterioration of $255 million from a year earlier.

CEO Louie Pastor said headwinds have intensified beyond prior expectations, forcing the company to lower its full-year guidance for adjusted operating income and free cash flow while reaffirming revenue of approximately $7.6 billion. The company is implementing cost measures to preserve cash, and the dividend suspensions are among those steps.

Also on October 29, Xerox announced an exchange transaction covering approximately $174 million of its 5.500 percent Senior Notes due 2028. Under an Exchange Support Agreement with certain noteholders, the company will conduct an exchange offer to roll those maturities out to 2030 while reducing overall debt principal and preserving cash. The transaction is part of a broader balance sheet effort that has included earlier open market debt purchases.

Rosen Law Firm separately announced an investigation into potential securities claims on behalf of Xerox shareholders, alleging the company may have issued materially misleading business information to investors.