Xerox Reports Strong Q2 2026 Growth Driven by Lexmark Synergies

Xerox Reports Strong Q2 2026 Growth Driven by Lexmark Synergies

Xerox announced its second-quarter financial results for 2026, delivering substantial top-line expansion and operational margin growth.

Total revenue reached $1.922 billion, marking a 22.0% increase as reported and 21.2% compared to the $1.576 billion generated in the second quarter of 2025. On a pro forma basis—which accounts for the full-year contribution of Lexmark, acquired on July 1, 2025—revenue declined 6.5% year-over-year.

The company’s profitability metrics saw a notable boost during the quarter, aided by a $105 million pre-tax benefit following the recognition of International Emergency Economic Powers Act (IEEPA) tariff receivables. Driven by this benefit, adjusted operating income soared by 244% year-over-year to $203 million. This performance brought Xerox’s adjusted operating margin to 10.6%, representing a 690-basis-point expansion over the 3.7% margin reported a year earlier.

At the segment level, Print & Other led performance with total revenue of $1.733 billion, reflecting a 26.9% increase as reported, though down 6.1%. Equipment sales totaled $387 million, while post-sale revenue contributed $1.346 billion. Print & Other segment profit surged to $220 million, expanding its profit margin to 12.7%.

Meanwhile, the IT Solutions segment generated $194 million in revenue, an 8.9% decline year-over-year. Segment profit for IT Solutions stood at $7 million with a 3.7% operating margin, affected by intentional seller productivity investments and softer short-term hardware product sales.

Buoyed by strong execution across its strategic priorities, management raised its full-year 2026 outlook. Revenue expectation was bumped up to approximately $7.6 billion, and adjusted operating income guidance was lifted to a range of $555 million to $605 million. The company also raised its target for expected cumulative Lexmark gross cost synergies to at least $350 million.

Related:

• Xerox Launches New A4 Color Printers Following Rebranding
• Xerox Turns the Page With New Branding
• Xerox Launches AI-Driven IT Platform
• Xerox Reports Improved Q1 Revenue Trajectory
• Xerox Appoints Louie Pastor as New CEO

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