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Xerox Leadership Discusses 2024 Game Plan, Core Business Strategy, More

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Last week, Xerox held its fourth-quarter earnings conference call, discussing its fourth-quarter earnings results, as well as its strategy for 2024 and beyond.

Focus on Core Businesses

Xerox CEO Steve Bandrowczak emphasized that Xerox will continue to focus on its core businesses: “Our first priority of 2024 is the continued strengthening of our core print, digital and IT service businesses.” These businesses will form the bedrock of the company’s  strategy and new opportunities, including revenue diversification, and the adoption of a business unit, rather than a geographic-led operating model, along with a greater focus on a partner-led distribution. Xerox expects these changes to both strengthen its core businesses and capture new ancillary revenue opportunities over time.

As part of Xerox’s focus on its core businesses – print, digital and IT services – it’s divested from non-core businesses, such as PARC, the Xerox Research Center of Canada, and its 3D-printer business, Elem. It’s also reduced its presence in some non-strategic markets with lower levels of profitability, such as paper and certain types of IT hardware.

Bandrowczak also noted that since he became CEO in August of 2022, he had directed Xerox to put more emphasis on solutions-based products and services that address the productivity challenges of a hybrid workplace.

Ultimately, Bandrowczak says these and other actions put the company  firmly on the path to returning… to double-digit profitability by 2026.”

Xerox Chief Operating Officer John G. Bruno also said Xerox is focused on improving its legacy business (print), while also seeking adjacent opportunities for digital and IT services with existing and new clients. The company is also focusing on hybrid-work solutions, with Bruno noting, “…we are designing a simpler, more operationally efficient organization to address our clients most important hybrid workplace challenges now and into the future.”

Bruno also noted that Xerox has moved from a geographic to business unit-led operating model to align its groups responsible for its print, digital, and IT service businesses, from product development to sales and services, 

Xerox’s newly created Global Business Services (GBS) is also designed to centrally coordinate internal processes, leveraging shared capabilities and platforms.

Fourth-Quarter Revenue

Xerox CFO Xavier Heiss said the fourth quarter’s revenue decline of 9.1 percent year-over-year was due mainly to a significant reduction of equipment backlog in the fourth quarter a year ago. Revenue growth was further affected by the intentional reduction of certain non-strategic revenue.

Heiss noted that “underlying demand for our equipment remains stable and order activity is gaining momentum as macroeconomic conditions stabilize.”

Xerox expects its core business revenue to be roughly flat year-over-year, reflecting stable print demand, growth in digital and IT services, and neutral macroeconomic conditions.

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