Xerox (XRX) 29 Oct 242024 Q3 Earnings call transcript

Thank you for standing by, and welcome to Xerox Holdings Corporation's Third Quarter Earnings Conference Call. [Operator Instructions] As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Mr. David Beckel, Vice President of Investor Relations. Please go ahead, sir.

Good morning, everyone. President of Vice Xerox Relations Beckel, Corporation. Holdings David and Investor Head at I'm Xerox Third Executive Holdings Release the to Welcome Corporation hosted Steve Conference Quarter by Bandrowczak, Chief Officer. Call Earnings XXXX Bruno, President Vice Xerox recorded. Executive Chief Holdings He's joined today's and by and Operating call Xavier President request Officer; the Officer. At conference Chief Financial Corporation, Heiss, and of being John is permission of Other are expressed call rebroadcasting the this of recording and/or without prohibited Xerox.

on to meeting this statements, at materially the Actual time, call, be address different may available like Xerox in that During uncertain. turn comments which forward-looking future financial to are the this nature, web I'd to refer and contain slides than over Bandrowczak. make will their we'll matters Mr. those www.xerox.com/investor, that results herein. At the future and are executives that by expressed

joining morning, from improvements consecutive results, improved QX actual moderating quarter. income. than year-over-year of our in revenue XXXX you earnings businesses and is at conversion driving flow free adjusted the and revenue Revenue decreased income underlying rates mix income in more currency from higher period expected. adjusted albeit in ITsavvy proof X.X% results with XXX% acquisition margin the thank pending a $X.X from growth. Summarizing than Good The are of a expected operating for and financial our cash improve constant value-add to currency. Further, of declines, second of quarter complementary pace revenue include X.X% of Positive and reinvention for of benefits operating call. the slower points billion

nonstrategic single the simplification. The the core fluctuations at pace digits year-over-year by year-over-year business EPS impact revenue a Xerox XXX digital with operations in our steady the of backlog thesis, services. with basis Free has but low of difficult was is in and reinvention, to quarter. Adjusted points, million favorable $X.XX, been trends consistent sale multiyear organizational higher operating and the necessary. and a onetime margin was $XXX original declined linear benefit prior Progress associated within while not flow is sustainably positioning to points a Excluding prior in reflecting but benefits assets revenue to the of strategy's primarily noncore X.X% year long-term of adjusted streamline journey year-over-year $X lower lower reinvention success of year-over-year business of confirmatory cash of due the company from financial the quarter. and was $X.XX the reductions million, IT and proof fashion. print, unfolding in Reinvention are the

This quarter, Tactical print sales equipment sales in activity due timing products of fell associated lower-than-expected in and with productivity. launch to also markets the shortfall. certain in to delays contributed and X new global challenges competitive the improvements below Hurricane Helene expectation in increase of force

required our made the cost our in substantially goals. Starting strategic our will drive We beyond. Shortfalls in made economic and annuity early in a buyers are efficiently are and those of of of In model contributed in furtherance progress have will to product than investment refined with between perception effectiveness that productivity confident we revenue and long-term improvement productivity we sales and services. the and the key And reinvention expected core. factors stronger alignment realized productivity factors our efficiency products coverage of were to We and launch tenet breadth effectively analyzed in to despite client in our programs organization confident be reinvention higher along a equipment A and masked as which is and leaner, more progress the in closer that reveal over more sales each XXXX realignment The the our is sales launch recalibrate that would serve not sales the improved lower reinvention priorities plans. date, client as of force needs of lower expected efficiently outcomes QX, sales delays as our product team sales like, itself to evolving global ongoing past. than we print and organization more in been X, a quarter focused deliver we has signs landscape. sustainably seeing clients and time. smooth a encouraging can services streams much reinvention base workplace but and rapidly we resolved are in of

While in QX, market reduction focus of sales has end burden. through productivity greater expectation our in short a administrative fell a and it improved year-to-date

The effect additional to XXX%, evidence drive our including and QX designed proposition foster in with position the IT market in date, We from will a efficiency interactions strength buying and In for taken Promoter the and into than remained has of solutions cumulative client prominently expect productivity digital from contracts. QX a our the retention the revenue and print, client service last client digital an average, actions large in value print to capacity of on in XX which us increase intent increase more our as dedicated rate in will when in workflow we virtual purchase renewing our our and leading provider client other improved and metrics. initiatives this year most and appreciate long-term clients sales clients expect understand increased of and clients We incremental meaning Americas solutions. of engagement above XXXX. Net XX renewals that Score, see efficiencies, productivity services months, are levels points the barometer center outreach. brand key drive integrated future higher sales of satisfaction scale a reflects sales perception improved client consideration, marketing through

leverage clients. And digital managed digital renewal portfolio of rates double expanded prior and services of and plan also clients. the portfolio up Our digits signings current existing pending growth IT services to and acquisition business were double ITsavvy digits, and as growth improved managed periods. in IT sustained penetration of expected with new continues to is strongly signings above services reflecting with resonate an we grow the drive revenue IT services to In QX, digital grew with

reorganization Moving to $XX strategic $XXX current of than cost have with QX million in service taken of year-over-year business the by benefits prior million Operating year year-to-date, reinvention expense operating associated business reductions revenue. and in actions of headcount in in year, and decreased ongoing Certain structural organization. actions reflecting the more year reduction the improvements. global our efficiencies taken driven this our resulted

example, from decision manufacturing to For of as certain offerings the to in with to certain distribution the simplification, simplify measures the case equipment. as exit production our or our is indirect taken transition markets geographic case with direct the was

Our associated expense intent supported greater the those in that actions activities level than the is with reduce these a profit. gross amount reductions to of by operating previously

a early, improved adjusted see the despite we this beginning quarter out operating still a in are thesis revenue. in company play level, results. income While our to financial total reduction At

to gross We identified income expect been yet of savings but support in future pipeline this cost million that to realized more expect implementation been $XXX X. have for quarter In trend either operating continue or of results future than growth. we years, have our actioned in not

Finally, balanced allocation. capital

the the operating income. generated we from $XXX more cash XXX% of cash benefits than fourth than free marking million This consecutive finance including receivables, adjusted more of flow, quarter free flow reduction in quarter, of conversion

a pending the finance The to to reduced will including little of U.S., will of We our make acquisition hand agreements part sheet Lage funding debt progress future balance and the debt, ITsavvy over quarter De sell to be signed John originations deliver than to Services in our with neutral receivable more year we of a finance now continue quarter-over-quarter. call outside expected but weighted improved again recently to cost capital return Landen in on Canada, a leverage agreement funded is in this average well receivable Bruno. Financial Inc. Balance in be capital. I sourcing Canada excess health as

fell quarter, poor and of deliberate market-specific Through product this Steve we're readiness for ensure transition launches. impacted and We had improved supply planning complement steps product by postmortem, main programs expectations to marketing As X that go-to-market noted, reasons. of chain specific global taking higher to short price our optimize that were sales by to expectations execution. demand areas will launches equipment

the of not sufficient sales the We quarter-on-quarter organizational we were also changes. had the that essentially our We QX, offset higher realized was after QX flat sales improvement QX in productivity and in given in to initiatives basis, on expectations reduction activity an headcount.

course from We've and We to generation, have of quote areas we improvement these points of teams, lead correcting to analyzed these underperformance. order friction are aligned and order process install.

We are forecasted. originally albeit work, seeing that of more slowly the than impact positive

no with sales stalled to we productivity productivity While QX, improvements process make equipment excuses sales, in these into our expect higher we operational broader of other XXXX. underperformance elsewhere. On overshadow areas and to simplification. do strategic forecasted drive in seeing are for QX misses results the strategic and reinvention of operational in We and these efforts. like geographic I'd where balance, Starting highlight improvements our

quarter, direct X countries, Hungary distribution and an Bulgaria we a This to from additional transitioned model. indirect

These the We in our EMEA EMEA to X, in others a services efficiency. sell demand in quarter products paper leading greater agreement clients business supplier, provide and and paper operating to also and signed partners transaction an to allow global with Antalis. expected most with us

simplification. to offering Moving

the and With production offerings our the office refreshes streamlining series in we Altalink products, recent of launches XXX light are Primelink AX AX of categories. our and our and

reducing series, printers part share engine common by spare series XX%. XXX updated the SKUs example, our XXX a with For

capabilities Software efficiency. improving process. products inventory improve well competitive capabilities, as competitiveness updated simplify installation range Altalink engine new features as products enhancements installation of order with make eliminate a the machines kits and marketability. respective wider for The And physical and more enhanced our the marketing configurations speeds, consolidated included management these offer the need and and Primelink of them and and

a to for print We print we manufacturers more equipment our as integrate quarter, portfolio. broaden revealing digital we our this leading continue engine services-led to planned production software-enabled and anticipate partnerships we production print We've Tactical software their products. featuring segment the ecosystem. engaged Additionally, with print embellishment in the clients. collaboration to in our year invest announced coming within platform technology with And refine our production

offerings. And Core For adjacencies example, versions of FreeFlow AI expansions as simplification. into cloud-hosted model like SaaS-based include framework and to an automation, operating finally, our workflow application includes as labels for well packaging pipeline

long-term savings infrastructure. enterprise-wide organization, transform on technology-led Service the signed operations be a optimization outsourcing restructured intended in is improvement our incentive a putting beneficial structure an multiple double-digit are service with million model next Business key course double-digit for and our than serve efficiencies. through achieve the this savings years, to more with agreements technology of driver to agreement save blueprint contracted GBS Last path over a A reinvention a with gross finding to of mutually operating performing drive building expected is Global organizational and of new these costs will on Our a will rates expected us and partners a sustainable we partner, to to quarter, cumulative savings process technology This to And $XXX announcement improvements. the creating ways reinvention. driving operating support structure quarter, drive savings. yield to as business process adjusted leverage margins our that key of income GBS Collectively, reinvention long-term over simpler as efficiencies. or operating a few

continue operational to implementation the initiatives revenue execution exercise mix. and finally, to will disruption. And of We balanced these minimize

the our services improved announced end, With of acquisition that addressable infrastructure suite client our its acquisition with IT tenet outcomes. Beyond of collaboration pillars team and management important we and ITsavvy. mix the that workplace. offerings expands of hybrid IT enables reinvention across The life an hosting, deliver cycle ability a market X of service equally our To accomplished results positive of ITsavvy, network deployment an to revenue managed reduction, acquired of and is through ago, weeks security, and an coverage. better cloud we demonstrated portfolio ITsavvy cost

seller leverage IT will these We funded acquisition hand expect to be of and scale this penetration base a increasingly provide solutions. The combination on and client types to services to cash a with drive Xerox of notes. who to of across platform improve increased look

the print end ITsavvy to more consolidate forward in call to $XX a a and the to services cost cash and at realize as enhanced we improve IT accretive Xerox core expected can ITsavvy's most infrastructure be The synergies hand acquisition operations service for than value from look partner welcoming critical of from expect This and stability earnings now expect needs. Along offering. to client team business platform. an Xavier. print shop quickly to million services immediately to be expanded per one-stop satisfaction the revenue that their able share this IT We and will more we flow, to penetration, operating client is our IT clients over are with and synergies adopt as free year. I'll realize we of

and QX, In currency in currency John, you, actual X.X% on morning, declined constant good basis. X.X% year-over-year and Thank a everyone. total revenue in

Steve As equipment of short fell described, revenue expectation. this quarter

revenue post-sales of in digital and services. trajectory the as improved reflecting However, expected, managed IT growth

million offset adjusted reflects prior compared a with the the operating $X.XX valuation year a reinvention $XX benefit $X.XX action. year. Adjusted an last than in allocated higher more Turning profitability. by mix margin gain due flat was reflecting other headcount or non-labor lower beneficial our financing margin and to reduction costs, and in effect. net in year. than the Adjusted allowance goodwill quarter allowance the increase savings increase increase offset also higher recent and gain or benefit lower to charge impact to an Gross rate in a unfavorable were the as approximately interest volumes associated assets. GAAP and to asset. year-over-year equipment recorded year-over-year of expenses expense nonfinancing higher were tax other on Adjusted prior lower of operating freight billion print expense of XX%, The year-over-year was by were higher year deferred lower favorable currency nonfinance higher in the and nonrecurring $XXX establishment noncash and on with of reinvention $X to a Adjusted higher rate of reflecting X.X% of of tax uncertain million XXX of share million, gross year noncore expense, current profit. Total noncore included the operating same rate by tax of cost position than establishment of reinvention-related compensation after-tax $XX count partially tax per X.X%, of $X.XX. income principally declined year-over-year incentive offset higher charge on $X.XX a related more valuation associated EPS the The business expense, $X.XX, interest as sales expenses against to the expense, basis and of assets a reflects tax share business due on a XX.X% points per rate lower interest share business. debt was sales lower or of loss to portion the impairment effect reduction on revenue tax the of prior QX

a the impairment, of The expected certain market Print that sustained that value. period value international our realized assets tax it which to goodwill fallen against Regarding book was has in fell are our Other deferred following determined valuation carrying was value, below value below in the allowance established segment be not fair jurisdiction. and

the XXX in currency. action equipment white an constant to largely revenue and Let $XXX cash of fluctuations equipment in with flow installation in than printers. around were year-over-year backlog detail. slightly productivity, of and products, due production installations mainly and Entry in of a Hurricane around declined the improvement. the multifunction black production current declined million decline sequential new year-over-year, the for lower-than-expected sales revenue The declined in associated activity faster the ongoing improvement and sales me to more installation revenue QX delays High-end of increased remainder family revenue low-end of despite and product installation declined $X.X of and basis points action XXX mainly timing reflects revenue. increase year. Total mix. rationalization year. Post-sales our X% currency, XX% sales launch a global actual of constant with review delayed reinvention the decline. equipment due higher prior Starting mix print billion taken point the actual force accounted X year roughly to lower effect in now portfolio basis decline unfavorable entry-level due revenue Helene, evolution offering XX% the equipment. prior Midrange mix in AX and of The but unfavorable in large this reflects of and

currency, X% will managed and as as actual of revenue offset lower the our in placement nonstrategic, growth services and in paper help IT which excludes digital post-sales activity, reduction endpoint reinvention other Excluding to and declined action, action. reflecting with lower-margin commentary IT by additional of device double-digit effect services I clarify of effect and core businesses, pricing. Consistent provide revenue reinvention well in underlying higher past backlog trends quarter, the fluctuations partially

simplification the around business receivable QX, to XXX decline. the basis finance strategic For actions including nonstrategic strategy paper, taken change of device points to lower in sales geographic basis our finance revenue, to decline reflecting contributed and offering simplify and decline. the in endpoint XXX contributed point improve our IT profitability, and around Other

the When prior quarters decline than actual contributed the single fluctuations current revenue. effect less basis in in XXX are points of the revenue Finally, currency, total removed, quarter. low and equipment impacts year-over-year these total backlog in prior with consistent the to year declined digits

noncore of $XX million $X this prior the business quarter, Investing of $XX $XXX now source largely activities Let's and $X income from and and prior to from activity lower flow. million. than prior of receivable. $XXX million flow reflecting million Operating by operating million reflecting repayment assets. cash was the by Financing adjusted year, Free were to debt net use in $XX year-over-year. cash working pension million, cash finance million of quarter a contribution of compared higher year $X flow higher of review a was cash cash lower million, lower $XX consumed capital partially cash payment, sales a million of due dividend offset year

its change finance associated revenue solution. in of with reductions in Turning with and revenue the mainly XFS to roughly income X% to roughly for year-over-year in in the due flow year-over-year offset commission in from line the million actual segment by return XX% forward our other bad was by to increased associated reasons around debt decline strategy. due XFS receivable X%, captive-only to than balance, partially $X In lower by more financing QX expense profit increased declined balance revenue operating XFS XX% fell down sequentially Other mentioned. XFS sales previously gross profit offset to fee finance our receivable assets lower in QX, X% receivable expenses finance and higher and finance as segment. with a lower revenue. Print currency, focus and strategy segment reduction profit around and

with and restricted now structure. of $X.X Focusing $X provide to Around reinvention remaining $XXX equivalents with cash. ended of outstanding the business. I debt cash, nonfinancing capital of on finance on We support remaining cash billion asset billion million the update savings. attributable QX of $X.X billion an the our debt

maintain expect more million related $XX For to expected cost of of XXXX, by pipeline the a realized prior million implemented cost we be around $XXX will are $XXX than savings, XXXX we million gross of savings in incremental to term. to to of be an the to $XXX realized already XXXX. be quarter, of We realize have operationalized in additional close Since gross savings. much actions implemented or with near expected that million which

Finally, the of address on and for expectation I commentary of remainder guidance effect excludes acquisition the the pending for XXXX All of comment the year ITsavvy. will XXXX.

now in year a other sales reflects points in to with in incremental The actions. nonstrategic expect effect of nonstrategic nonrecurring of revenue, XX revenue and in guidance basis now current of is versus intentional prior improvement. the constant associated delayed Full around year revenue. effect XX% reduction from backlog For decline currency headwinds in X% guidance year, to of the XXX X% and of points revenue lower-than-expected decrease remainder reinvention previously. in associated and reduction productivity decline of Around with we attributable currency constant around X new the launch a basis the products fluctuation includes force decline

post-sales mid-single-digit a so a equipment in year, in roughly mid-single-digit decline normalized indicate normalized the in decline year-over-year of revenue. expected For X% sales low business core revenue and to decline

more of The and a improved product the and inorganic to We inclusion ongoing impact than XXXX. with ITsavvy, benefit reduction of in were growth associated be action to digital return revenue from productivity growth expect than expected acquisition ITsavvy in of revenue with to expected in in associated offset lower pending revenue are revenue sales supported XXXX, launches, revenue the are as services. XXXX the in IT reinvention by strategic new in reduction they

lesser XXXX, level margin, certain the least adjusted adjusted revenue expect a year implementation For in margin initiatives operating Due X% revenue effect X.X%, million longer lower-than-expected to operating in at of with gross versus equipment by XXXX. to reduction expect around we prior our our outlook our grow of we to no delays now full decline profit a to and income of reflecting of the cost outlook XXXX extent, in XXXX. the income $XXX above reduction associated

in in operating growth XXXX, adjusted and and adjusted our cost supported expect cost in be margin implemented income double-digit with to operating revenue course by or to to we of associated income growth continue and the a we operating over savings adjusted expect XXXX income implemented a return However, gross additional reinvention. In the of in margin return reduction growth benefit expected XXXX. to actions

was income a free full presented in of summary, adjusted million Finally, noted cash to previously million challenges. operating million, has $XXX guidance. In at XXXX range to flow reduced $XXX reflecting least $XXX the unexpected from year guidance reduction

buyers operating to our as and we reduction we implement revenue, simplifying in we QX, of further for action and expect closer and line product Q&A. open income adjusted alignment in to the despite aimed grew now However, a services. We'll the margin a organization economic our reinvention year-over-year at driving continue trend

question Capital. Certainly. today Ananda from for Loop first the And line from comes Baruah of our

of mentioned, -- that I dynamics you on lot product it. delay, guess a And I And guys was that question if it and give in you guess first sort can could, have the what of pop greater that X, actually you the these any good context, missed dynamics as have specifically that sales on I if context what around then of a the have delay product not led specificity on surprised product I like -- well. up just -- productivity? the the sales did that of sort sales it, around follow-up -- to diminished occurring? can saw sort guys learn guess you I again? And what productivity, quick of that And can guys the you the I sort is, then as also you on to. did -- guess, you occurred talked is I that I the productivity on

Ananda, I'll just the remind to this is revenue Thank the ultimate you reinvention question. Steve. growth journey, is is for turn a get to it multiyear sustainable operating and minute inside the in to a over John for journey. double-digit look, And I And to to some specifics. want that multiyear strategy But income. get you,

part As some areas. made of the each in that, progress of we've

you revenue think do great platform for growth gives mix, to our services of we're us in over seeing If the trying what about ITsavvy IT couple a next years.

of will reinvention, We saw multiple that is inside of year-over-year. My set we get exceed, we of ultimately our and which some streams, good which expense will goal. operating have end impact work be some point quarter-over-quarter but reduction also to will back,

you made the premise in productivity give? what jobs QX we realigned in other into a to launch want And X,XXX changes to QX reduction. basically of of of in our of is caused color the had almost QX improvement We new to very QX, QX. John, productivity, quarter-over-quarter from large which product the and saw reduction workforce, to from we Specifically the at very specifically terms large organizational terms end new revenue alignment. very

We between the of intricacies the inventory of lot a products and When with that go new anything of that release first. the of flush start signaling. product, into new me mix, the the let release predecessor than timing going carried direct forecasting transition else. the we issue Ananda, a expectations then more the forecasting had through to of of business, of higher to at there's Sure. and the were supply It's not channels. and timing look also we product the to issue product our but products, only demand the older

not that We working that each has have of As make towards have weeks, inventory That better lot really subsequently we in a the what the a those the a want And actually were as with company would want capital transitions. do and skill the make. points effective of to the a good through of leave would it performed. something of that don't to sense started a get lot the bit we of is made. we clearly, of that we than typically start and that is of is last sell a timing just issues, of We bullish the to Steve quarter a At time quarter, make decision quarter, change. did those little more us the the received. through decision, attributed end ramp and we X we actually to the have we do behind. higher than left to a to And and

were was and assignments, year-on-year taking which to it pin the coming look territory balance. And of out of And from the things at really beginning really But replacing transition continued in, we really more you're sales And of the at we view it a were all on quota-bearing of these the and comes more we down as the year. forecasting the Coming double the that with that into down number there, where a in coverage the new the come with the down be clients. when are, productivity. new nothing of the quarter. misses that tens then remapping, lot a as digits we supply forecast more to we've of your progress, to few and and Steve you new to thing and of that. to we sales on start we that timing good think all as headcount the millions signaling. And a on lot as settled when also account saw, the of difference at is it revenue upside of And comes our which sellers of of aggressive that demand knowledge addressed the a so come dollars between a and force of year, And perspective. thought equipment some the the issue sales to And need I would on period then down of just basis. quarter you it's close down quarterly between here and a --

me an a In I know. -- of QX, build gives have the level. to had you that we flat when it QX, and really QX. had QX, was activity QX, from much a had So what over is essentially did going I at I better we look off When good at that, look confidence was expectations not basis QX we productivity as

And didn't the that certainly down, that caused programs confidence we've dissected We so we but gives me it to stabilized. go kind what of flatness. necessarily

the forward. force, it's all now the the around that gives the activities generation all accuracy forecasting So we're that us confidence moving incremental about that doing sales demand we're and

also Yes. would like to... I

Yes, yes, please.

Ananda, Yes. yes, jumping I to... also would like we're this on all one.

Ananda. Sorry,

Just one also reinforce point. to

made from know XX% is revenue, total that post-sales. XX% of coming So ESA, roughly revenue the which you our of is is

was that we improved quarter-over-quarter from ESA when at and in and during a look you QX an QX. in revenue articulated and view, despite So the challenges of John it this the Steve growth what improvement there, growth the have trajectory QX, sequential has seen trajectory point year, versus have still

and are see related driving -- also pleased to all activities to revenue quarter-over-quarter. are post-sales despite On that improving is the stream related the to post-sales we the that reinvention we revenue,

example we equipment And behind it line. is face reinvention have we are And play that could message the quarter. The cyclical. revenue play currently. the an delivering here, So is the key specifically of we on it nature and during the be this post-sales is at

useful appreciate That's and it. all context, I super really

sense John, cede progression? follow-up a that macro bit market also to and quick sort flattening the general then I'll a a to if the efficiency sort or contributor backdrop the just that, was of progression, of, efficiency and So of and Q-over-Q sort floor. Any the of was softer demand sales

say I Yes, say Most would of I execution issues. that it would minimal. just minimal. Yes,

blame love I'd the about the Obviously. to It's macro. same.

of Morgan line our from next Erik question Woodring comes And from the Stanley.

Maybe You're step the may. doing you model to changing lot, exiting businesses, if several delivery start, in just I if have I back, Steve, guys X, are regions. you're right? a we

the you're XXXX, I headwinds. And headcount, products, businesses. reducing all face kind for expectation growth, tough, markets all you're actions. But about setting as at revenue for on continue background you're and credit this think operating comments given right today, I And and challenges through launching this of this in everything that face time while why year, is taking you wondering that's your do preliminary which go year And your the new You're happening these and new an of some same to into demand acquiring set think that that's expansion. I'm income you you run is growth obviously, -- next just to the expectation as you you theoretically margin the given happened reinvention. could some end

And year? follow-up, and pieces, expansion margin back please. So gives confidence is just changes a the question moving maybe get growth the all and say amidst next I to can of you then these what to have we

So to of thanks a I'm things. for going question. use the couple

of got we're can team and the the of the all, of it it's and things executing. we we things building you see how that First future, recognition around history signs can our place, around We've pattern put over program see done that execution, careers. that's we're management see that through internally the over we've the the in what

to XX or they're going think exceed you see where X similar deliver under if X reinvention, to overall, overall, the end very own But you way, it, X, expectations. the streams, exceed the you So going work results. they're or we had to by about XX, X,

what that up we're our did that are to the free all very with what income PARC, and cash things things flow, to to with we specific is did desire. back get strategical these what seeing operating us set the revenue we we doing. Go so the long-term we're And strategic growth

seeing look as the of on the you streams, the it out, line, each So expense work it coming definitively. we costs at we're see

to able the in working be background You ITsavvy. to acquire see acquisition, on that the

we're new terms and terms see what of new pipeline, doing sales in in customers. of changing You our what building that's dramatically building doing coverage

confident in linear And and long-term looking the That's doing program it an that Taking can is I it's and quarter. at then see trying It's to do a not with I'm the this. challenge X-year we're so isolated working. straight. But what not that the our years and to to across things trying everything we're over that do, track. of what importantly, we've and says the and of recognition careers evidence returns next right do, couple the we're done the more trying pattern the on we're

Super. point follow-up as clarification. of just quick a a Okay. just And then maybe or

to you EBITDA on the with So X%. around believe margins disclosures have are you that just X%. margins I provided ITsavvy, guys close that EBITDA adjusted

excuse synergies. synergies? just accretion some But understand being us terms talked just that around totality, So asset know that immediately. us be would in this helpful. the some help getting assumptions about you're guys Can super revenue cost understand this if the math -- you that to alluded me, could accretive, help the accretive of kind I being you of you of to you diluted in

Erik, acquisition, and you ITsavvy, Yes. also revenue the on insight the size some the will give I synergy the here. of expected the

it you million the around mentioned earnings a mentioned and are currently if and million, they around million million is well. to LTM remember, which release, we $XXX We're deliver here. we as expecting company is around here. in EBITDA, $XX $XXX This So revenue $XX of call in synergy the press as

you X% EBITDA EBITDA they when see include [ of what which year the So above you ], the on will like here. be and versus bring revenue, this can will type margin

our a And us view, versus EPS flow are of to become follow will current cash be immediately from number. They So accretive there. it here. they accretive pure directly free will point also obviously, will

the drive is gross at of see. to margin will of the we at there is different, our a bottom point line, but to the less will day, OpEx, an EBITDA flag point we margin, And less view, it model look metric this a the immediately. so that want so is capture end will what improvement financial in business So from also gross I

this So soon. quite as is expecting transaction which are starting happen closed, to we as soon

of final maybe point just clarification. one Xavier, And

the ITsavvy As correctly. we sure that flows into model. just line to we incorporate kind I and model, rentals it about through make is maintenance that of incorporating as our we're -- just services, assume think want I

Yes.

will we the do distribute way in same today. it We it

an going is team, how revenue different a in bulk of of you is similar one the with will IR hardware, So we help the it. can the the which is do element and way but line, and but forma, will very there we it here. pro team this to the David do the

that digital important As our And reporting. this year, is will is IT proof because With to at well, XX%. company planning for here are I it and the as segment services point an the ITsavvy, the this call next point total of is have, know end reinvention ITsavvy we strategy you play. a that just day, at become

move reinvention X%. here. that an And guided is step X%. the jump this print we'll additional we step revenue, in XX%. first will the by significant XX% for And we We'll So this achieve this to that -- have not a want have literally we is Currently, are trajectory of is program, during which related. remember, direction,

questions we don't I'd it appears at have remarks. the back this Bandrowczak time, any program like further further Steve that in As Instructions] to hand any [Operator for the to queue

call, this year, for to shortfalls. identified and of today's have fell sales addressed but the and Recapping are expectation contributed you. short quarter our equipment we these the we factors confident that Thank

and expected XXXX. in to growth of revenue the We improved an equipment acquisition ITsavvy to pending revenue return trajectory drive a

very single productivity expected progress are reinvention. results reminds operating path enabling attending this client defines for efficiencies, on growth performance the gives indicator sales long-term quarter quarterly us force profitable we call. no and us confidence in to you gains services reinvention. through or Thank perception, much Consistent This signings our

today's conclude ladies you, program. the your for and does Thank gentlemen, participation This in conference.

disconnect. Good now may You day.