Xerox Slides After Deep Q4 Earnings Miss Despite Upbeat 2026 Outlook
January 29, 2026 8:29 AM
IH Market News
Xerox Holdings Corporation (NASDAQ:XRX) reported a sharply weaker-than-expected fourth quarter on Thursday, with earnings missing Wall Street forecasts by a wide margin, triggering a steep sell-off in the shares.
Adjusted earnings per share came in at -$0.10, well below the consensus estimate of $0.29. Revenue totaled $2.03 billion, slightly under market expectations of $2.05 billion. Xerox shares plunged 12.45% in premarket trading following the release.
Quarterly performance was weighed down by a challenging macroeconomic environment, with uncertainty around tariffs and government funding pressuring demand for transactional print equipment. Higher DRAM prices also lifted product costs, creating additional headwinds for the company’s IT Solutions segment.
“We continue to execute with discipline in a difficult macro backdrop, including the lingering effects of government uncertainty and rising memory costs,” said Steve Bandrowczak, chief executive officer at Xerox. “The Lexmark integration is advancing ahead of plan, and the teams are delivering tangible synergies.”
Despite the weak quarter, Xerox struck a more optimistic tone on the outlook. For fiscal year 2026, the company forecast revenue above $7.5 billion, ahead of the analyst consensus of $7.05 billion. It also guided to adjusted operating income of $450 million to $500 million and free cash flow of roughly $250 million.
On a pro forma basis, fourth-quarter revenue declined 9.0% year on year, while adjusted operating income of $102 million was $2 million lower than a year earlier. The adjusted operating margin slipped to 5.0%, down 140 basis points from the prior-year period.
Equipment sales rose 23.4% to $485 million, largely reflecting the impact of the Lexmark acquisition, which contributed a 35.2 percentage point uplift. Excluding Lexmark, however, equipment revenue declined 11.8%.
Looking ahead, Xerox highlighted several encouraging indicators entering 2026, including a larger sales pipeline compared with last year, improved cancellation and renewal trends, and signs that declines in page volumes are beginning to stabilise.
Xerox Holdings Corporation stock price
Original: Xerox Slides After Deep Q4 Earnings Miss Despite Upbeat 2026 Outlook
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