Document And Entity Information
Document And Entity Information - Jun. 30, 2015 - shares | Total |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Xerox Corporation |
Entity Central Index Key | 108,772 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2015 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q2 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 1,068,794,642 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - Scenario, Unspecified [Domain] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Revenues | ||||
Sales | $ 1,224 | $ 1,342 | $ 2,350 | $ 2,599 |
Outsourcing, maintenance and rentals | 3,279 | 3,501 | 6,532 | 6,915 |
Financing | 87 | 98 | 177 | 198 |
Total Revenues | 4,590 | 4,941 | 9,059 | 9,712 |
Costs and Expenses | ||||
Cost of sales | 776 | 832 | 1,450 | 1,610 |
Cost of outsourcing, maintenance and rentals | 2,356 | 2,488 | 4,724 | 4,942 |
Cost of financing | 32 | 36 | 65 | 72 |
Research, development and engineering expenses | 142 | 143 | 283 | 288 |
Selling, administrative and general expenses | 906 | 959 | 1,821 | 1,904 |
Restructuring and asset impairment charges | 157 | 39 | 171 | 65 |
Amortization of intangible assets | 79 | 78 | 156 | 155 |
Other expenses, net | 68 | 65 | 114 | 104 |
Total Costs and Expenses | 4,516 | 4,640 | 8,784 | 9,140 |
Income before Income Taxes and Equity Income | 74 | 301 | 275 | 572 |
Income tax (benefit) expense | (9) | 73 | 30 | 115 |
Equity in net income of unconsolidated affiliates | 29 | 33 | 63 | 75 |
Income from Continuing Operations | 112 | 261 | 308 | 532 |
(Loss) income from discontinued operations, net of tax | (95) | 11 | (61) | 26 |
Net Income | 17 | 272 | 247 | 558 |
Less: Net income attributable to noncontrolling interests | 5 | 6 | 10 | 11 |
Net income from continuing operations | 107 | 255 | 298 | 521 |
(Loss) income from discontinued operations, net of tax | (95) | 11 | (61) | 26 |
Net Income Attributable to Xerox | $ 12 | $ 266 | $ 237 | $ 547 |
Basic Earnings per Share: | ||||
Continuing operations (dollars per share) | $ 0.09 | $ 0.21 | $ 0.26 | $ 0.43 |
Discontinued operations (dollars per share) | (0.08) | 0.01 | (0.06) | 0.03 |
Total Basic Earnings per Share (dollars per share) | 0.01 | 0.22 | 0.20 | 0.46 |
Diluted Earnings per Share: | ||||
Continuing operations (dollars per share) | 0.09 | 0.21 | 0.26 | 0.43 |
Discontinued operations (dollars per share) | (0.08) | 0.01 | (0.06) | 0.02 |
Total Diluted Earnings per Share (dollars per share) | $ 0.01 | $ 0.22 | $ 0.20 | $ 0.45 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income - Scenario, Unspecified [Domain] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Net income | $ 17 | $ 272 | $ 247 | $ 558 | |
Less: Net income attributable to noncontrolling interests | 5 | 6 | 10 | 11 | |
Net Income Attributable to Xerox | 12 | 266 | 237 | 547 | |
Other Comprehensive Income (Loss), Net | |||||
Translation adjustments, net | [1] | 194 | 92 | (315) | 91 |
Unrealized (losses) gains, net | [1] | (19) | 15 | 10 | 41 |
Changes in defined benefit plans, net | [1] | 67 | (70) | 165 | (154) |
Other Comprehensive Income (Loss), Net | [1] | 242 | 37 | (140) | (22) |
Less: Other comprehensive income, net attributable to noncontrolling interests | 1 | 1 | 0 | 1 | |
Other Comprehensive Income (Loss), Net Attributable to Xerox | 241 | 36 | (140) | (23) | |
Comprehensive Income, Net | |||||
Comprehensive Income, Net | 259 | 309 | 107 | 536 | |
Less: Comprehensive income, net attributable to noncontrolling interests | 6 | 7 | 10 | 12 | |
Comprehensive Income, Net Attributable to Xerox | $ 253 | $ 302 | $ 97 | $ 524 | |
[1] | Refer to Note 16 - Other Comprehensive Income (Loss) for gross components of Other Comprehensive Income (Loss), reclassification adjustments out of Accumulated Other Comprehensive Loss and related tax effects. |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - Scenario, Unspecified [Domain] - USD ($) shares in Thousands, $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 | [1] |
Assets, Current [Abstract] | |||
Cash and cash equivalents | $ 1,641 | $ 1,411 | |
Accounts receivable, net | 2,722 | 2,652 | |
Billed portion of finance receivables, net | 113 | 110 | |
Finance receivables, net | 1,328 | 1,425 | |
Inventories | 1,072 | 934 | |
Assets of discontinued operations | 0 | 1,260 | |
Other current assets | 956 | 1,082 | |
Total current assets | 7,832 | 8,874 | |
Finance receivables due after one year, net | 2,581 | 2,719 | |
Equipment on operating leases, net | 500 | 525 | |
Land, buildings and equipment, net | 1,078 | 1,123 | |
Investments in affiliates, at equity | 1,377 | 1,338 | |
Intangible assets, net | 1,890 | 2,031 | |
Goodwill | 8,810 | 8,805 | |
Other long-term assets | 1,948 | 2,243 | |
Total Assets | 26,016 | 27,658 | |
Liabilities, Current [Abstract] | |||
Short-term debt and current portion of long-term debt | 1,648 | 1,427 | |
Accounts payable | 1,568 | 1,584 | |
Accrued compensation and benefits costs | 664 | 754 | |
Unearned income | 428 | 431 | |
Liabilities of discontinued operations | 0 | 371 | |
Other current liabilities | 1,422 | 1,509 | |
Total current liabilities | 5,730 | 6,076 | |
Long-term debt | 5,998 | 6,314 | |
Pension and other benefit liabilities | 2,634 | 2,847 | |
Post-retirement medical benefits | 790 | 865 | |
Other long-term liabilities | 418 | 454 | |
Total Liabilities | 15,570 | 16,556 | |
Series A Convertible Preferred Stock | 349 | 349 | |
Common stock | 1,097 | 1,124 | |
Additional paid-in capital | 3,967 | 4,283 | |
Treasury stock, at cost | (316) | (105) | |
Retained earnings | 9,605 | 9,535 | |
Accumulated other comprehensive loss | (4,299) | (4,159) | |
Xerox shareholders’ equity | 10,054 | 10,678 | |
Noncontrolling interests | 43 | 75 | |
Total Equity | 10,097 | 10,753 | [2] |
Total Liabilities and Equity | $ 26,016 | $ 27,658 | |
Shares of common stock issued (shares) | 1,096,623 | 1,124,354 | |
Treasury stock (shares) | (27,828) | (7,609) | |
Shares of common stock outstanding (shares) | 1,068,795 | 1,116,745 | |
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. | ||
[2] | Balance at December 31, 2014 was revised - Refer to Note 1 - Basis of Presentation for additional information regarding this revision. |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - Scenario, Unspecified [Domain] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Cash Flows from Operating Activities: | |||||
Net income | $ 17 | $ 272 | $ 247 | $ 558 | |
Adjustments required to reconcile net income to cash flows from operating activities: | |||||
Depreciation and amortization | 297 | 376 | 593 | 721 | |
Provision for receivables | 14 | 22 | 32 | 38 | |
Provision for inventory | 10 | 4 | 16 | 14 | |
Net loss (gain) on sales of businesses and assets | 74 | 1 | 62 | (29) | |
Undistributed equity in net income of unconsolidated affiliates | (3) | 2 | (34) | (40) | |
Stock-based compensation | 23 | 24 | 45 | 50 | |
Restructuring and asset impairment charges | 157 | 38 | 171 | 65 | |
Payments for restructurings | (30) | (36) | (61) | (72) | |
Contributions to defined benefit pension plans | (57) | (68) | (98) | (105) | |
Increase in accounts receivable and billed portion of finance receivables | (6) | (150) | (245) | (389) | |
Collections of deferred proceeds from sales of receivables | 62 | 106 | 134 | 226 | |
Increase in inventories | (67) | (43) | (193) | (103) | |
Increase in equipment on operating leases | (69) | (66) | (139) | (123) | |
Decrease in finance receivables | 6 | 18 | 78 | 54 | |
Collections on beneficial interest from sales of finance receivables | 12 | 21 | 27 | 42 | |
Decrease (increase) in other current and long-term assets | 11 | (24) | (60) | (118) | |
Decrease in accounts payable and accrued compensation | (21) | (96) | (38) | (88) | |
Decrease in other current and long-term liabilities | (57) | (82) | (83) | (108) | |
Net change in income tax assets and liabilities | 17 | 43 | 49 | 72 | |
Net change in derivative assets and liabilities | 14 | (20) | 2 | (21) | |
Other operating, net | (55) | (17) | (43) | (33) | |
Net cash provided by operating activities | 349 | 325 | 462 | 611 | |
Cash Flows from Investing Activities: | |||||
Cost of additions to land, buildings and equipment | (77) | (102) | (152) | (186) | |
Proceeds from sales of land, buildings and equipment | 0 | 2 | 16 | 35 | |
Cost of additions to internal use software | (25) | (21) | (45) | (40) | |
Proceeds from sale of businesses | 930 | 15 | 933 | 15 | |
Acquisitions, net of cash acquired | (20) | (227) | (48) | (281) | |
Other investing, net | 23 | 7 | 29 | 11 | |
Net cash provided by (used in) investing activities | 831 | (326) | 733 | (446) | |
Cash Flows from Financing Activities: | |||||
Net proceeds (payments) on debt | 53 | (299) | (97) | (295) | |
Common stock dividends | (77) | (73) | (147) | (141) | |
Preferred stock dividends | (6) | (6) | (12) | (12) | |
Proceeds from issuances of common stock | 4 | 19 | 14 | 39 | |
Excess tax benefits from stock-based compensation | 1 | 3 | 3 | 6 | |
Payments to acquire treasury stock, including fees | (395) | (204) | (611) | (479) | |
Repurchases related to stock-based compensation | 0 | 0 | (1) | (1) | |
Distributions to noncontrolling interests | (2) | (1) | (56) | (17) | |
Other financing | (1) | 0 | (1) | (10) | |
Net cash used in financing activities | (423) | (561) | (908) | (910) | |
Effect of exchange rate changes on cash and cash equivalents | 12 | 2 | (57) | (12) | |
Increase (decrease) in cash and cash equivalents | 769 | (560) | 230 | (757) | |
Cash and cash equivalents at beginning of period | 872 | 1,567 | 1,411 | [1] | 1,764 |
Cash and Cash Equivalents at End of Period | $ 1,641 | $ 1,007 | $ 1,641 | $ 1,007 | |
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation References herein to “we,” “us,” “our,” the “Company” and “Xerox” refer to Xerox Corporation and its consolidated subsidiaries unless the context suggests otherwise. We have prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with the accounting policies described in our 2014 Annual Report on Form 10-K (2014 Annual Report), and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. You should read these Condensed Consolidated Financial Statements in conjunction with the Consolidated Financial Statements included in our 2014 Annual Report. In our opinion, all adjustments which are necessary for a fair statement of financial position, operating results and cash flows for the interim periods presented have been made. These adjustments consist of normal recurring items. Interim results of operations are not necessarily indicative of the results of the full year. For convenience and ease of reference, we refer to the financial statement caption “Income before Income Taxes and Equity Income” as “pre-tax income.” In December 2014 we announced an agreement to sell our Information Technology Outsourcing (ITO) business to Atos SE (Atos). As a result of this agreement and having met applicable accounting requirements, we reported the ITO business as held for sale and a discontinued operation at December 31, 2014. The sale was completed in June 2015. In 2014 we also completed the disposal of two smaller businesses - Xerox Audio Visual Solutions, Inc. (XAV) and Truckload Management Services (TMS) - that were also reported as discontinued operations. All prior periods have been reclassified to conform to the presentation of these businesses as discontinued operations. Refer to Note 5 - Divestitures for additional information regarding discontinued operations. During second quarter 2015, in connection with Fuji Xerox’s (FX) payment of its semi-annual dividend, we determined that the dividends were no longer subject to an additional tax as a result of a change in the U.K. - Japan Tax Treaty in December 2014. As of December 31, 2014, we had a deferred tax liability of $ 44 associated with this additional tax on the undistributed earnings of FX through that date. This deferred tax liability was no longer required as a result of the change in the Tax Treaty and, therefore, should have been reversed in December 2014. There was no impact on operating cash flows from this adjustment. We assessed the materiality of this error on our 2014 financial statements and concluded that it was not material to the fourth quarter or annual period. However, due to the impact of this adjustment on the current year consolidated financial statements, the accompanying unaudited Condensed Consolidated Balance Sheet has been revised as of December 31, 2014 to increase retained earnings by $ 44 and decrease our deferred tax liabilities by the same amount. The following table presents the effect of this correction on our Consolidated Statements of Income for all periods affected: Three Months Ended December 31, 2014 Year Ended December 31, 2014 As Reported As Revised As Reported As Revised Income tax expense $ 78 $ 34 $ 259 $ 215 Income from Continuing Operations 311 355 1,107 1,151 Net Income 162 206 992 1,036 Net Income Attributable to Xerox 156 200 969 1,013 Net Income Attributable to Xerox - continuing operations 305 349 1,084 1,128 Basic Earnings per Share: Continuing Operations $ 0.26 $ 0.30 $ 0.92 $ 0.96 Total Basic Earnings per Share 0.13 0.17 0.82 0.86 Diluted Earnings per Share: Continuing Operations $ 0.26 $ 0.30 $ 0.90 $ 0.94 Total Diluted Earnings per Share 0.13 0.17 0.81 0.85 The following table presents the effect this correction had on our Consolidated Balance Sheet at December 31, 2014: December 31, 2014 As Reported As Revised Other long-term liabilities $ 498 $ 454 Total Liabilities 16,600 16,556 Retained earnings 9,491 9,535 Xerox shareholders' equity 10,634 10,678 Total Equity 10,709 10,753 The correction did not have an effect on the Company’s operating cash flows. The following table presents the effect on the individual line items within operating cash flows of our Consolidated Statement of Cash Flows for the year ended December 31, 2014: Year Ended December 31, 2014 As Reported As Revised Net income $ 992 $ 1,036 Net change in income tax assets and liabilities 29 (15 ) |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Fair Value Measurements: In May 2015, the FASB issued ASU 2015-07 , Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent). The update removes the requirement to categorize within the fair value hierarchy all investments for which fair value is being measured using the net asset value per share practical expedient. The amendments also remove the requirements to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value practical expedient. ASU 2015-07 is effective for our fiscal year beginning January 1, 2016, and is not expected to have a material impact on our financial condition, results of operations or cash flows. Intangibles - Goodwill and Other - Internal Use Software: In April 2015, the FASB issued ASU 2015-05 , Intangibles-Goodwill and Other-Internal Use Software - Customer's Accounting for Fees Paid in a Cloud Computing Arrangement. The update provides guidance on fees paid by an entity in a cloud computing arrangement and whether an arrangement includes a license to the underlying software. If a cloud computing arrangement includes a software license, then the entity should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the entity should account for the arrangement as a service contract. The guidance in this update does not change GAAP for an entity's accounting for service contracts. Additionally, this update does not change the accounting guidance for a provider of cloud computing services. This update is effective for our fiscal year beginning January 1, 2016. The adoption of this standard is not expected to have a material effect on our financial condition, results of operations or cash flows. Interest: In April 2015, the FASB issued ASU 2015-03 , Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs . The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Debt issuance costs are currently reported as a deferred charge in Other long-term assets and were $ 33 at June 30, 2015 . This update is effective for our fiscal year beginning January 1, 2016 with early adoption permitted. The adoption of this standard is not expected to have a material effect on our financial condition, results of operations or cash flows. Consolidation: In February 2015, the FASB issued ASU 2015-02 , Consolidation (Topic 810): Amendments to the Consolidation Analysis . This update reduces the number of consolidation models by changing the evaluation of (a) limited partnerships and similar entities, (b) whether fees paid to a decision maker or service provider are variable interests in a variable interest entity, and (c) variable interests in a VIE held by related parties. This update is effective for our fiscal year beginning January 1, 2016 with early adoption permitted, and is applied on a retrospective or modified retrospective basis. The adoption of this standard is not expected to have a material effect on our financial condition, results of operations or cash flows. Income Statement: In January 2015, the FASB issued ASU 2015-01 , Income Statement - Extraordinary and Unusual Items (Subtopic 225-20) - Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items . ASU 2015-01 eliminates from GAAP the concept of extraordinary items. ASU 2015-01 is effective for our fiscal year beginning January 1, 2016, with early adoption permitted. The standard primarily involves presentation and disclosure and, therefore, is not expected to have a material impact on our financial condition, results of operations or cash flows. Derivatives and Hedging: In November 2014, the FASB issued ASU 2014-16 , Derivatives and Hedging (Topic 815) - Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity . ASU 2014-16 does not change the current criteria in GAAP for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. The amendments clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. ASU 2014-16 is effective for our fiscal year beginning January 1, 2016, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our financial condition, results of operations, or cash flows. Disclosures of Going Concern Uncertainties: In August 2014, the FASB issued ASU 2014-15 , Presentation of Financial Statements - Going Concern (Subtopic 205-40); Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern . ASU 2014-15 provides guidance regarding management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. ASU 2014-15 is effective for our fiscal year beginning January 1, 2016, with early adoption permitted. We do not expect the adoption of this standard to have an impact on our financial condition, results of operations, or cash flows. Stock Compensation: In June 2014, the FASB issued ASU 2014-12 , Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could be Achieved after the Requisite Service Period . ASU 2014-12 requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update is effective for our fiscal year beginning January 1, 2016 and early adoption is permitted. We do not expect the adoption of this standard to have a material impact on our financial condition, results of operations or cash flows. Revenue Recognition: In May 2014, the FASB issued ASU 2014-09 , Revenue from Contracts with Customers (Topic 606) , to supersede nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing U.S. GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 is effective for our fiscal year beginning January 1, 2018, with early adoption permitted for fiscal years beginning January 1, 2017. The standard will be adopted using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within ASU 2014-09; or (ii) retrospective with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application and providing certain additional disclosures as defined per ASU 2014-09. We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements. Discontinued Operations: In April 2014, the FASB issued ASU 2014-08 , Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The update changes the requirements for reporting discontinued operations in Subtopic 205-20. A discontinued operation may include a component of an entity or a group of components of an entity, or a business. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. Examples include a disposal of a major geographic area, a major line of business or a major equity method investment. Additionally, the update requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. This update was effective prospectively for our fiscal year beginning January 1, 2015. The standard primarily involves presentation and disclosure and, therefore, is not expected to have a material impact on our financial condition, results of operations or cash flows. Service Concession Arrangements: In January 2014, the FASB issued ASU 2014-05 , Service Concession Arrangements (Topic 853) . This update specifies that an entity should not account for a service concession arrangement within the scope of this update as a lease in accordance with Topic 840, Leases. The update does not provide specific accounting guidance for various aspects of service concession arrangements but rather indicates that an entity should refer to other Topics as applicable to account for various aspects of a service concession arrangement. The update was effective for our fiscal year beginning January 1, 2015. The adoption of this standard did not have a material effect on our financial condition, results of operation or cash flows. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting Our reportable segments are aligned with how we manage the business and view the markets we serve. We report our financial performance based on the following two primary reportable segments – Services and Document Technology. Our Services segment operations involve delivery of a broad range of services, including business process and document outsourcing. Our Document Technology segment includes the sale and support of a broad range of document systems from entry level to high-end. The Services segment is comprised of two outsourcing service offerings: • Business Process Outsourcing (BPO) • Document Outsourcing (which includes Managed Print Services) (DO) Business process outsourcing services include service arrangements where we manage a customer’s business activity or process. We provide multi-industry offerings such as customer care, transaction processing, finance and accounting, and human resources, as well as industry-focused offerings in areas such as healthcare, transportation, financial services, retail and telecommunications. Document outsourcing services include service arrangements that allow customers to streamline, simplify and digitize document-intensive business processes through automation and deployment of software applications and tools and the management of their printing needs. Document outsourcing services also include revenues from our partner print services offerings. Our Document Technology segment includes the sale of products that share common technology, manufacturing and product platforms. Our products groupings range from: • “Entry,” which includes A4 devices and desktop printers; to • “Mid-range,” which includes A3 devices that generally serve workgroup environments in midsize to large enterprises and includes products that fall into the following market categories: Color 41+ ppm priced at less than $100K and Light Production 91+ ppm priced at less than $100K; to • “High-end,” which includes production printing and publishing systems that generally serve the graphic communications marketplace and large enterprises. Customers range from small and mid-sized businesses to large enterprises. Customers also include graphic communication enterprises as well as channel partners including distributors and resellers. Segment revenues reflect the sale of document systems and supplies, technical services and product financing. The segment classified as Other includes several units, none of which meet the thresholds for separate segment reporting. This group includes paper sales in our developing market countries, Wide Format Systems, licensing revenues, Global Imaging Systems (GIS) network integration solutions and electronic presentation systems, non-allocated corporate items including non-financing interest and other items included in Other expenses, net. Operating segment revenues and profitability were as follows: Three Months Ended Six Months Ended Segment Revenue Segment Profit (Loss) Segment Revenue Segment Profit(Loss) 2015 Services $ 2,569 $ 192 $ 5,083 $ 381 Document Technology 1,880 228 3,710 431 Other 141 (76 ) 266 (138 ) Total $ 4,590 $ 344 $ 9,059 $ 674 2014 Services $ 2,651 $ 226 $ 5,236 $ 448 Document Technology 2,126 306 4,170 555 Other 164 (75 ) 306 (125 ) Total $ 4,941 $ 457 $ 9,712 $ 878 Three Months Ended Six Months Ended Reconciliation to Pre-tax Income 2015 2014 2015 2014 Segment Profit $ 344 $ 457 $ 674 $ 878 Reconciling items: Restructuring and asset impairment charges, and related costs (1) (160 ) (46 ) (178 ) (75 ) Restructuring charges of Fuji Xerox (1 ) 1 (2 ) (2 ) Amortization of intangible assets (79 ) (78 ) (156 ) (155 ) Equity in net income of unconsolidated affiliates (29 ) (33 ) (63 ) (75 ) Other (1 ) — — 1 Pre-tax Income $ 74 $ 301 $ 275 $ 572 __________________________ (1) Includes business transformation costs of $3 and $7 for the three months ended June 30, 2015 and June 30, 2014 , respectively, and $7 and $10 for the six months ended June 30, 2015 and June 30, 2014, respectively. Business transformation costs represent incremental costs incurred directly in support of our business transformation and restructuring initiatives such as compensation costs for overlapping staff, consulting costs and training costs. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions In January 2015 , we acquired Intellinex LLC (Intellinex), formerly Intrepid Learning Solutions, Inc., a Seattle-based company, for $28 in cash. Intellinex provides outsourced learning services primarily in the aerospace manufacturing and technology industries. The acquisition of Intellinex will solidify the position of Xerox's Learning Services unit as a leading provider of end-to-end outsourced learning services, and adds key vertical market expertise in the aerospace industry. Intellinex is included in our Services segment. During 2015 we also acquired one additional business in our Services segment for approximately $14 in cash, and one additional business in our Document Technology segment for approximately $6 in cash. The operating results of these acquisitions are not material to our financial statements and are included within our results from the acquisition dates. The purchase prices were allocated primarily to intangible assets, goodwill and internal use software based on third-party valuations and management’s estimates. |
Divestitures
Divestitures | 6 Months Ended |
Jun. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Divestitures | Divestitures Information Technology Outsourcing (ITO) In December 2014 we announced an agreement to sell the ITO business to Atos. As a result of this agreement and having met applicable accounting requirements, in the fourth quarter 2014, we began reporting the ITO business (disposal group) as a Discontinued Operation. All prior periods were accordingly revised to conform to this presentation. The sale was completed on June 30, 2015. The final sale price of approximately $940 ($ 930 net of cash sold) reflects closing adjustments, including an adjustment for changes in net asset values and additional proceeds for the condition of certain assets at the closing. Atos also assumed approximately $85 of capital lease obligations and pension liabilities. Net after-tax proceeds are estimated to be approximately $850 , which reflects expected cash taxes as well as our transaction and transition costs associated with the disposal. The ITO business included approximately 9,600 employees in 42 countries, who were transferred to Atos upon closing. In fourth quarter 2014, we recorded a net pre-tax loss of $181 related to the pending sale, reflecting the write-down of the carrying value of the ITO disposal group, inclusive of goodwill, to its estimated fair value less costs to sell. In 2015, we recorded an additional net pre-tax loss of $72 ( $68 in second quarter 2015) primarily related to adjustment of the sales price and related expenses associated with the disposal, as well as reserves for certain obligations and indemnifications we retained as part of the final closing negotiations. In addition, in second quarter 2015 we recorded tax expense of $54 primarily related to the difference between the book basis and tax basis of allocated goodwill, which could only be recorded upon final disposal of the business. The transaction continues to be subject to post-closing adjustments primarily related to a final true-up of net assets and other indemnification obligations. The additional loss recorded in the second quarter 2015 reflects current estimates for these items. In the event there are additional charges associated with this disposal, we will record such amounts through discontinued operations in future periods. Other Discontinued Operations: Other discontinued operations include the 2014 closure of Xerox Audio Visual Solutions, Inc. (XAV) and the 2014 sale of our Truckload Management Services, Inc. (TMS) business. Summarized financial information for our Discontinued Operations is as follows : Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 ITO Other Total ITO Other Total ITO Other Total ITO Other Total Revenues $ 308 $ — $ 308 $ 341 $ 17 $ 358 $ 619 $ — $ 619 $ 669 $ 38 $ 707 Income (loss) from operations (1), (2) 43 — 43 23 — 23 104 — 104 44 (1 ) 43 Loss on disposal (68 ) — (68 ) — (2 ) (2 ) (72 ) — (72 ) — — — Net (loss) income before income taxes $ (25 ) $ — $ (25 ) $ 23 $ (2 ) $ 21 $ 32 $ — $ 32 $ 44 $ (1 ) $ 43 Income tax expense (70 ) — (70 ) (9 ) (1 ) (10 ) (93 ) — (93 ) (16 ) (1 ) (17 ) (Loss) income from discontinued operations, net of tax $ (95 ) $ — $ (95 ) $ 14 $ (3 ) $ 11 $ (61 ) $ — $ (61 ) $ 28 $ (2 ) $ 26 _______________ (1) ITO Income from operations excludes depreciation and amortization expenses of approximately $ 41 and $ 80 (including $ 7 and $ 14 for intangible amortization) for the three and six months ended June 30, 2015, respectively, since the business was held for sale. (2) ITO Income from operations includes intangible amortization and other expenses of approximately $8 and $16 for the three and six months ended June 30, 2014 , respectively. The following is a summary of the major categories of assets and liabilities of the ITO business held for sale at December 31, 2014: December 31, 2014 Accounts receivable, net $ 213 Other current assets 146 Land, buildings and equipment, net 220 Intangible assets, net 197 Goodwill 337 Other long-term assets 147 Total Assets of Discontinued Operations $ 1,260 Current portion of long-term debt $ 31 Accounts payable 32 Accrued pension and benefit costs 9 Unearned income 64 Other current liabilities 112 Long-term debt 44 Pension and other benefit liabilities 25 Other long-term liabilities 54 Total Liabilities of Discontinued Operations $ 371 |
Accounts Receivable, Net
Accounts Receivable, Net | 6 Months Ended |
Jun. 30, 2015 | |
Receivables [Abstract] | |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable, net were as follows: June 30, 2015 December 31, 2014 Amounts billed or billable $ 2,485 $ 2,421 Unbilled amounts 319 318 Allowance for doubtful accounts (82 ) (87 ) Accounts Receivable, Net $ 2,722 $ 2,652 Unbilled amounts include amounts associated with percentage-of-completion accounting and other earned revenues not currently billable due to contractual provisions. Amounts to be invoiced in the subsequent month for current services provided are included in amounts billable, and at June 30, 2015 and December 31, 2014 were approximately $926 and $945 , respectively. We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. The allowance for uncollectible accounts receivable is determined principally on the basis of past collection experience, as well as consideration of current economic conditions and changes in our customer collection trends. Accounts Receivable Sales Arrangements Accounts receivable sales arrangements are utilized in the normal course of business as part of our cash and liquidity management. We have facilities in the U.S., Canada and several countries in Europe that enable us to sell certain accounts receivable without recourse to third-parties. The accounts receivable sold are generally short-term trade receivables with payment due dates of less than 60 days. All of our arrangements involve the sale of our entire interest in groups of accounts receivable for cash. In most instances a portion of the sales proceeds are held back by the purchaser and payment is deferred until collection of the related receivables sold. Such holdbacks are not considered legal securities nor are they certificated. We report collections on such receivables as operating cash flows in the Condensed Consolidated Statements of Cash Flows because such receivables are the result of an operating activity and the associated interest rate risk is de minimis due to its short-term nature. Our risk of loss following the sales of accounts receivable is limited to the outstanding deferred purchase price receivable. These receivables are included in the caption “Other current assets” in the accompanying Condensed Consolidated Balance Sheets and were $59 and $73 at June 30, 2015 and December 31, 2014 , respectively. Under most of the arrangements, we continue to service the sold accounts receivable. When applicable, a servicing liability is recorded for the estimated fair value of the servicing. The amounts associated with the servicing liability were not material. Of the accounts receivable sold and derecognized from our balance sheet, $539 and $580 remained uncollected as of June 30, 2015 and December 31, 2014 , respectively. Accounts receivable sales were as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Accounts receivable sales $ 586 $ 726 $ 1,188 $ 1,548 Deferred proceeds 57 96 119 220 Loss on sales of accounts receivable 3 4 6 8 Estimated decrease to operating cash flows (1) (27 ) (31 ) (10 ) (20 ) __________________________ (1) Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency. Finance Receivables, Net Sale of Finance Receivables In 2013 and 2012 , we transferred our entire interest in certain groups of lease finance receivables to third-party entities for cash proceeds and beneficial interests. The transfers were accounted for as sales with derecognition of the associated lease receivables. There have been no transfers of finance receivables since the year ended December 31, 2013 . We continue to service the sold receivables and record servicing fee income over the expected life of the associated receivables. The following is a summary of our prior sales activity. Year Ended December 31, 2013 2012 Net carrying value (NCV) sold $ 676 $ 682 Allowance included in NCV 17 18 Cash proceeds received 635 630 Beneficial interests received 86 101 Pre-tax gain on sales 40 44 Net fees and expenses 5 5 The principal value of finance receivables derecognized from our balance sheet was $376 and $549 (sales value of approximately $404 and $596 ) at June 30, 2015 and December 31, 2014 , respectively. Summary The lease portfolios transferred and sold were all from our Document Technology segment, and the gains on these sales were reported in Financing revenues within the Document Technology segment. The ultimate purchaser has no recourse to our other assets for the failure of customers to pay principal and interest when due beyond our beneficial interests, which were $56 and $77 at June 30, 2015 and December 31, 2014 , respectively, and are included in Other current assets and Other long-term assets in the accompanying Condensed Consolidated Balance Sheets. Beneficial interests of $46 and $64 at June 30, 2015 and December 31, 2014 , respectively, are held by bankruptcy-remote subsidiaries and therefore are not available to satisfy any of our creditor obligations. We report collections on the beneficial interests as operating cash flows in the Condensed Consolidated Statements of Cash Flows because such beneficial interests are the result of an operating activity, and the associated interest rate risk is de minimis considering their weighted average lives of less than 2 years. The net impact from the sales of finance receivables on operating cash flows is summarized below: Three Months Ended Six Months Ended 2015 2014 2015 2014 Impact from prior sales of finance receivables (1) $ (89 ) $ (137 ) $ (194 ) $ (286 ) Collections on beneficial interest 15 25 33 51 Estimated Decrease to Operating Cash Flows $ (74 ) $ (112 ) $ (161 ) $ (235 ) ____________________________ (1) Represents cash that would have been collected had we not sold finance receivables. Finance Receivables – Allowance for Credit Losses and Credit Quality Finance receivables include sales-type leases, direct financing leases and installment loans. Our finance receivable portfolios are primarily in the U.S., Canada and Europe. We generally establish customer credit limits and estimate the allowance for credit losses on a country or geographic basis. Our policy and methodology used to establish our allowance for doubtful accounts has been consistently applied over all periods presented. The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables: Allowance for Credit Losses: United States Canada Europe Other (3) Total Balance at December 31, 2014 $ 41 $ 20 $ 58 $ 12 $ 131 Provision 2 1 5 3 11 Charge-offs — (3 ) (1 ) (1 ) (5 ) Recoveries and other (1) — — (6 ) — (6 ) Balance at March 31, 2015 $ 43 $ 18 $ 56 $ 14 $ 131 Provision 1 1 6 2 10 Charge-offs (1 ) (2 ) (5 ) (2 ) (10 ) Recoveries and other (1) (1 ) 1 3 — 3 Balance at June 30, 2015 $ 42 $ 18 $ 60 $ 14 $ 134 Finance receivables as of June 30, 2015 collectively evaluated for impairment (2) $ 1,710 $ 397 $ 1,619 $ 430 $ 4,156 Balance at December 31, 2013 $ 45 $ 22 $ 81 $ 6 $ 154 Provision 3 2 7 3 15 Charge-offs (1 ) (4 ) (5 ) (2 ) (12 ) Recoveries and other (1) 1 — — — 1 Balance at March 31, 2014 $ 48 $ 20 $ 83 $ 7 $ 158 Provision 1 2 11 1 15 Charge-offs — (4 ) (8 ) 1 (11 ) Recoveries and other (1) — 2 — — 2 Balance at June 30, 2014 $ 49 $ 20 $ 86 $ 9 $ 164 Finance receivables as of June 30, 2014 collectively evaluated for impairment (2) $ 1,684 $ 421 $ 2,170 $ 339 $ 4,614 __________________ (1) Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations. (2) Total Finance receivables exclude the allowance for credit losses of $134 and $164 at June 30, 2015 and 2014 , respectively. (3) Includes developing market countries and smaller units. We evaluate our customers based on the following credit quality indicators: • Investment grade: This rating includes accounts with excellent to good business credit, asset quality and the capacity to meet financial obligations. These customers are less susceptible to adverse effects due to shifts in economic conditions or changes in circumstance. The rating generally equates to a Standard & Poors (S&P) rating of BBB- or better. Loss rates in this category are normally minimal at less than 1% . • Non-investment grade: This rating includes accounts with average credit risk that are more susceptible to loss in the event of adverse business or economic conditions. This rating generally equates to a BB S&P rating. Although we experience higher loss rates associated with this customer class, we believe the risk is somewhat mitigated by the fact that our leases are fairly well dispersed across a large and diverse customer base. In addition, the higher loss rates are largely offset by the higher rates of return we obtain on such leases. Loss rates in this category are generally in the range of 2% to 4% . • Substandard: This rating includes accounts that have marginal credit risk such that the customer’s ability to make repayment is impaired or may likely become impaired. We use numerous strategies to mitigate risk including higher rates of interest, prepayments, personal guarantees, etc. Accounts in this category include customers who were downgraded during the term of the lease from investment and non-investment grade status when the lease was originated. Accordingly, there is a distinct possibility for a loss of principal and interest or customer default. The loss rates in this category are around 10% . Credit quality indicators are updated at least annually and the credit quality of any given customer can change during the life of the portfolio. Details about our finance receivables portfolio based on industry and credit quality indicators are as follows: June 30, 2015 December 31, 2014 Investment Grade Non-investment Grade Substandard Total Finance Receivables Investment Grade Non-investment Grade Substandard Total Finance Receivables Finance and other services $ 191 $ 177 $ 59 $ 427 $ 195 $ 159 $ 55 $ 409 Government and education 556 13 4 573 589 13 3 605 Graphic arts 150 81 83 314 148 79 90 317 Industrial 91 41 16 148 92 41 18 151 Healthcare 87 25 14 126 84 26 14 124 Other 55 40 27 122 55 38 29 122 Total United States 1,130 377 203 1,710 1,163 356 209 1,728 Finance and other services 55 34 11 100 54 31 12 97 Government and education 67 8 2 77 76 8 2 86 Graphic arts 51 41 29 121 58 49 36 143 Industrial 24 13 4 41 24 13 4 41 Other 35 20 3 58 34 19 4 57 Total Canada 232 116 49 397 246 120 58 424 France 224 208 109 541 253 234 129 616 U.K./Ireland 246 95 4 345 255 101 6 362 Central (1) 217 216 28 461 230 278 30 538 Southern (2) 31 145 30 206 60 148 36 244 Nordics (3) 23 43 — 66 25 49 1 75 Total Europe 741 707 171 1,619 823 810 202 1,835 Other 167 205 58 430 195 163 40 398 Total $ 2,270 $ 1,405 $ 481 $ 4,156 $ 2,427 $ 1,449 $ 509 $ 4,385 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows: June 30, 2015 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 2 $ 11 $ 416 $ 427 $ 12 Government and education 16 3 3 22 551 573 25 Graphic arts 14 1 1 16 298 314 8 Industrial 4 1 1 6 142 148 7 Healthcare 3 1 1 5 121 126 5 Other 4 — — 4 118 122 4 Total United States 48 8 8 64 1,646 1,710 61 Canada 9 2 1 12 385 397 11 France — — 1 1 540 541 31 U.K./Ireland 2 1 — 3 342 345 1 Central (1) 4 2 1 7 454 461 6 Southern (2) 12 4 3 19 187 206 10 Nordics (3) 1 — — 1 65 66 3 Total Europe 19 7 5 31 1,588 1,619 51 Other 13 2 — 15 415 430 — Total $ 89 $ 19 $ 14 $ 122 $ 4,034 $ 4,156 $ 123 December 31, 2014 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 1 $ 10 $ 399 $ 409 $ 13 Government and education 14 4 3 21 584 605 25 Graphic arts 12 1 1 14 303 317 6 Industrial 4 1 1 6 145 151 9 Healthcare 3 1 — 4 120 124 5 Other 3 1 — 4 118 122 6 Total United States 43 10 6 59 1,669 1,728 64 Canada 9 2 1 12 412 424 17 France — 1 2 3 613 616 35 U.K./Ireland 1 — — 1 361 362 1 Central (1) 2 2 1 5 533 538 15 Southern (2) 14 4 4 22 222 244 17 Nordics (3) 1 — — 1 74 75 2 Total Europe 18 7 7 32 1,803 1,835 70 Other 13 1 — 14 384 398 — Total $ 83 $ 20 $ 14 $ 117 $ 4,268 $ 4,385 $ 151 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. |
Finance Receivables, Net
Finance Receivables, Net | 6 Months Ended |
Jun. 30, 2015 | |
Financing Receivable, Net [Abstract] | |
Finance Receivables, Net | Accounts Receivable, Net Accounts receivable, net were as follows: June 30, 2015 December 31, 2014 Amounts billed or billable $ 2,485 $ 2,421 Unbilled amounts 319 318 Allowance for doubtful accounts (82 ) (87 ) Accounts Receivable, Net $ 2,722 $ 2,652 Unbilled amounts include amounts associated with percentage-of-completion accounting and other earned revenues not currently billable due to contractual provisions. Amounts to be invoiced in the subsequent month for current services provided are included in amounts billable, and at June 30, 2015 and December 31, 2014 were approximately $926 and $945 , respectively. We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. The allowance for uncollectible accounts receivable is determined principally on the basis of past collection experience, as well as consideration of current economic conditions and changes in our customer collection trends. Accounts Receivable Sales Arrangements Accounts receivable sales arrangements are utilized in the normal course of business as part of our cash and liquidity management. We have facilities in the U.S., Canada and several countries in Europe that enable us to sell certain accounts receivable without recourse to third-parties. The accounts receivable sold are generally short-term trade receivables with payment due dates of less than 60 days. All of our arrangements involve the sale of our entire interest in groups of accounts receivable for cash. In most instances a portion of the sales proceeds are held back by the purchaser and payment is deferred until collection of the related receivables sold. Such holdbacks are not considered legal securities nor are they certificated. We report collections on such receivables as operating cash flows in the Condensed Consolidated Statements of Cash Flows because such receivables are the result of an operating activity and the associated interest rate risk is de minimis due to its short-term nature. Our risk of loss following the sales of accounts receivable is limited to the outstanding deferred purchase price receivable. These receivables are included in the caption “Other current assets” in the accompanying Condensed Consolidated Balance Sheets and were $59 and $73 at June 30, 2015 and December 31, 2014 , respectively. Under most of the arrangements, we continue to service the sold accounts receivable. When applicable, a servicing liability is recorded for the estimated fair value of the servicing. The amounts associated with the servicing liability were not material. Of the accounts receivable sold and derecognized from our balance sheet, $539 and $580 remained uncollected as of June 30, 2015 and December 31, 2014 , respectively. Accounts receivable sales were as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Accounts receivable sales $ 586 $ 726 $ 1,188 $ 1,548 Deferred proceeds 57 96 119 220 Loss on sales of accounts receivable 3 4 6 8 Estimated decrease to operating cash flows (1) (27 ) (31 ) (10 ) (20 ) __________________________ (1) Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency. Finance Receivables, Net Sale of Finance Receivables In 2013 and 2012 , we transferred our entire interest in certain groups of lease finance receivables to third-party entities for cash proceeds and beneficial interests. The transfers were accounted for as sales with derecognition of the associated lease receivables. There have been no transfers of finance receivables since the year ended December 31, 2013 . We continue to service the sold receivables and record servicing fee income over the expected life of the associated receivables. The following is a summary of our prior sales activity. Year Ended December 31, 2013 2012 Net carrying value (NCV) sold $ 676 $ 682 Allowance included in NCV 17 18 Cash proceeds received 635 630 Beneficial interests received 86 101 Pre-tax gain on sales 40 44 Net fees and expenses 5 5 The principal value of finance receivables derecognized from our balance sheet was $376 and $549 (sales value of approximately $404 and $596 ) at June 30, 2015 and December 31, 2014 , respectively. Summary The lease portfolios transferred and sold were all from our Document Technology segment, and the gains on these sales were reported in Financing revenues within the Document Technology segment. The ultimate purchaser has no recourse to our other assets for the failure of customers to pay principal and interest when due beyond our beneficial interests, which were $56 and $77 at June 30, 2015 and December 31, 2014 , respectively, and are included in Other current assets and Other long-term assets in the accompanying Condensed Consolidated Balance Sheets. Beneficial interests of $46 and $64 at June 30, 2015 and December 31, 2014 , respectively, are held by bankruptcy-remote subsidiaries and therefore are not available to satisfy any of our creditor obligations. We report collections on the beneficial interests as operating cash flows in the Condensed Consolidated Statements of Cash Flows because such beneficial interests are the result of an operating activity, and the associated interest rate risk is de minimis considering their weighted average lives of less than 2 years. The net impact from the sales of finance receivables on operating cash flows is summarized below: Three Months Ended Six Months Ended 2015 2014 2015 2014 Impact from prior sales of finance receivables (1) $ (89 ) $ (137 ) $ (194 ) $ (286 ) Collections on beneficial interest 15 25 33 51 Estimated Decrease to Operating Cash Flows $ (74 ) $ (112 ) $ (161 ) $ (235 ) ____________________________ (1) Represents cash that would have been collected had we not sold finance receivables. Finance Receivables – Allowance for Credit Losses and Credit Quality Finance receivables include sales-type leases, direct financing leases and installment loans. Our finance receivable portfolios are primarily in the U.S., Canada and Europe. We generally establish customer credit limits and estimate the allowance for credit losses on a country or geographic basis. Our policy and methodology used to establish our allowance for doubtful accounts has been consistently applied over all periods presented. The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables: Allowance for Credit Losses: United States Canada Europe Other (3) Total Balance at December 31, 2014 $ 41 $ 20 $ 58 $ 12 $ 131 Provision 2 1 5 3 11 Charge-offs — (3 ) (1 ) (1 ) (5 ) Recoveries and other (1) — — (6 ) — (6 ) Balance at March 31, 2015 $ 43 $ 18 $ 56 $ 14 $ 131 Provision 1 1 6 2 10 Charge-offs (1 ) (2 ) (5 ) (2 ) (10 ) Recoveries and other (1) (1 ) 1 3 — 3 Balance at June 30, 2015 $ 42 $ 18 $ 60 $ 14 $ 134 Finance receivables as of June 30, 2015 collectively evaluated for impairment (2) $ 1,710 $ 397 $ 1,619 $ 430 $ 4,156 Balance at December 31, 2013 $ 45 $ 22 $ 81 $ 6 $ 154 Provision 3 2 7 3 15 Charge-offs (1 ) (4 ) (5 ) (2 ) (12 ) Recoveries and other (1) 1 — — — 1 Balance at March 31, 2014 $ 48 $ 20 $ 83 $ 7 $ 158 Provision 1 2 11 1 15 Charge-offs — (4 ) (8 ) 1 (11 ) Recoveries and other (1) — 2 — — 2 Balance at June 30, 2014 $ 49 $ 20 $ 86 $ 9 $ 164 Finance receivables as of June 30, 2014 collectively evaluated for impairment (2) $ 1,684 $ 421 $ 2,170 $ 339 $ 4,614 __________________ (1) Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations. (2) Total Finance receivables exclude the allowance for credit losses of $134 and $164 at June 30, 2015 and 2014 , respectively. (3) Includes developing market countries and smaller units. We evaluate our customers based on the following credit quality indicators: • Investment grade: This rating includes accounts with excellent to good business credit, asset quality and the capacity to meet financial obligations. These customers are less susceptible to adverse effects due to shifts in economic conditions or changes in circumstance. The rating generally equates to a Standard & Poors (S&P) rating of BBB- or better. Loss rates in this category are normally minimal at less than 1% . • Non-investment grade: This rating includes accounts with average credit risk that are more susceptible to loss in the event of adverse business or economic conditions. This rating generally equates to a BB S&P rating. Although we experience higher loss rates associated with this customer class, we believe the risk is somewhat mitigated by the fact that our leases are fairly well dispersed across a large and diverse customer base. In addition, the higher loss rates are largely offset by the higher rates of return we obtain on such leases. Loss rates in this category are generally in the range of 2% to 4% . • Substandard: This rating includes accounts that have marginal credit risk such that the customer’s ability to make repayment is impaired or may likely become impaired. We use numerous strategies to mitigate risk including higher rates of interest, prepayments, personal guarantees, etc. Accounts in this category include customers who were downgraded during the term of the lease from investment and non-investment grade status when the lease was originated. Accordingly, there is a distinct possibility for a loss of principal and interest or customer default. The loss rates in this category are around 10% . Credit quality indicators are updated at least annually and the credit quality of any given customer can change during the life of the portfolio. Details about our finance receivables portfolio based on industry and credit quality indicators are as follows: June 30, 2015 December 31, 2014 Investment Grade Non-investment Grade Substandard Total Finance Receivables Investment Grade Non-investment Grade Substandard Total Finance Receivables Finance and other services $ 191 $ 177 $ 59 $ 427 $ 195 $ 159 $ 55 $ 409 Government and education 556 13 4 573 589 13 3 605 Graphic arts 150 81 83 314 148 79 90 317 Industrial 91 41 16 148 92 41 18 151 Healthcare 87 25 14 126 84 26 14 124 Other 55 40 27 122 55 38 29 122 Total United States 1,130 377 203 1,710 1,163 356 209 1,728 Finance and other services 55 34 11 100 54 31 12 97 Government and education 67 8 2 77 76 8 2 86 Graphic arts 51 41 29 121 58 49 36 143 Industrial 24 13 4 41 24 13 4 41 Other 35 20 3 58 34 19 4 57 Total Canada 232 116 49 397 246 120 58 424 France 224 208 109 541 253 234 129 616 U.K./Ireland 246 95 4 345 255 101 6 362 Central (1) 217 216 28 461 230 278 30 538 Southern (2) 31 145 30 206 60 148 36 244 Nordics (3) 23 43 — 66 25 49 1 75 Total Europe 741 707 171 1,619 823 810 202 1,835 Other 167 205 58 430 195 163 40 398 Total $ 2,270 $ 1,405 $ 481 $ 4,156 $ 2,427 $ 1,449 $ 509 $ 4,385 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows: June 30, 2015 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 2 $ 11 $ 416 $ 427 $ 12 Government and education 16 3 3 22 551 573 25 Graphic arts 14 1 1 16 298 314 8 Industrial 4 1 1 6 142 148 7 Healthcare 3 1 1 5 121 126 5 Other 4 — — 4 118 122 4 Total United States 48 8 8 64 1,646 1,710 61 Canada 9 2 1 12 385 397 11 France — — 1 1 540 541 31 U.K./Ireland 2 1 — 3 342 345 1 Central (1) 4 2 1 7 454 461 6 Southern (2) 12 4 3 19 187 206 10 Nordics (3) 1 — — 1 65 66 3 Total Europe 19 7 5 31 1,588 1,619 51 Other 13 2 — 15 415 430 — Total $ 89 $ 19 $ 14 $ 122 $ 4,034 $ 4,156 $ 123 December 31, 2014 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 1 $ 10 $ 399 $ 409 $ 13 Government and education 14 4 3 21 584 605 25 Graphic arts 12 1 1 14 303 317 6 Industrial 4 1 1 6 145 151 9 Healthcare 3 1 — 4 120 124 5 Other 3 1 — 4 118 122 6 Total United States 43 10 6 59 1,669 1,728 64 Canada 9 2 1 12 412 424 17 France — 1 2 3 613 616 35 U.K./Ireland 1 — — 1 361 362 1 Central (1) 2 2 1 5 533 538 15 Southern (2) 14 4 4 22 222 244 17 Nordics (3) 1 — — 1 74 75 2 Total Europe 18 7 7 32 1,803 1,835 70 Other 13 1 — 14 384 398 — Total $ 83 $ 20 $ 14 $ 117 $ 4,268 $ 4,385 $ 151 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The following is a summary of Inventories by major category: June 30, 2015 December 31, 2014 Finished goods $ 895 $ 778 Work-in-process 66 58 Raw materials 111 98 Total Inventories $ 1,072 $ 934 |
Investment in Affiliates, at Eq
Investment in Affiliates, at Equity | 6 Months Ended |
Jun. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Affiliates, at Equity | Investment in Affiliates, at Equity Our equity in net income of unconsolidated affiliates was as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Fuji Xerox $ 25 $ 31 $ 56 $ 70 Other investments 4 2 7 5 Total Equity in Net Income of Unconsolidated Affiliates $ 29 $ 33 $ 63 $ 75 Fuji Xerox Equity in net income of Fuji Xerox is affected by certain adjustments required to reflect the deferral of profit associated with intercompany sales. These adjustments may result in recorded equity income that is different from that implied by our 25% ownership interest. Condensed financial data of Fuji Xerox was as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Summary of Operations: Revenues $ 2,389 $ 2,707 $ 5,120 $ 5,728 Costs and expenses 2,211 2,510 4,731 5,311 Income before income taxes 178 197 389 417 Income tax expense 63 67 129 125 Net Income 115 130 260 292 Less: Net income – noncontrolling interests 2 1 4 2 Net Income – Fuji Xerox $ 113 $ 129 $ 256 $ 290 Weighted Average Exchange Rate (1) 121.39 102.13 120.27 102.41 _____________________________ (1) Represents Yen/U.S. Dollar exchange rate used to translate. |
Restructuring Programs
Restructuring Programs | 6 Months Ended |
Jun. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Programs | Restructuring Programs During the six months ended June 30, 2015 , we recorded net restructuring and asset impairment charges of $171 , which included approximately $38 of severance costs related to headcount reductions of approximately 1,000 employees worldwide, $3 of lease cancellations and $146 of asset impairments associated with a change in our Government Healthcare Solutions strategy in our Services segment. These costs were offset by $16 of net reversals, primarily resulting from changes in estimated reserves from prior period initiatives. Information related to restructuring program activity during the six months ended June 30, 2015 is outlined below: Severance and Related Costs Lease Cancellation and Other Costs Asset Impairments (2) Total Balance at December 31, 2014 $ 93 $ 4 $ — $ 97 Provision 38 3 146 187 Reversals (13 ) (3 ) — (16 ) Net Current Period Charges (1) 25 — 146 171 Charges against reserve and currency (65 ) (1 ) (146 ) (212 ) Balance at June 30, 2015 $ 53 $ 3 $ — $ 56 _____________________________ (1) Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown. (2) Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision. Reconciliation to the Condensed Consolidated Statements of Cash Flows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Charges against reserve $ (175 ) $ (40 ) $ (212 ) $ (81 ) Asset impairments 146 3 146 7 Effects of foreign currency and other non-cash items (1 ) 1 5 2 Restructuring Cash Payments $ (30 ) $ (36 ) $ (61 ) $ (72 ) The following table summarizes the total amount of costs incurred in connection with these restructuring programs by segment: Three Months Ended Six Months Ended 2015 2014 2015 2014 Services (1)(2) $ 149 $ 5 $ 154 $ 14 Document Technology 8 26 17 42 Other — 8 — 9 Total Net Restructuring Charges $ 157 $ 39 $ 171 $ 65 _____________________________ (1) The three months ended June 30,2015 includes $146 of software asset impairment charges. (2) The three months ended June 30, 2014 excludes $ (1) related to the ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt Senior Notes In March 2015, we issued $400 of 2.75% Senior Notes due 2020 (the "2020 Senior Notes") at 99.879% of par and $250 of 4.80% Senior Notes due 2035 (the "2035 Senior Notes") at 99.428% of par, resulting in aggregate net proceeds of approximately $648 . Interest on the Senior Notes is payable semi-annually. Debt issuance costs of $6 were paid and deferred in connection with the issuances of these Senior Notes. The proceeds were used for general corporate purposes, which included repayment of a portion of our outstanding borrowings. Interest Expense and Income Interest expense and interest income were as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Interest expense (1),(2) $ 88 $ 96 $ 177 $ 195 Interest income (3) 89 101 181 203 ____________ (1) Includes Equipment financing interest as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income. (2) The six months ended June 30, 2015 and 2014 exclude $2 and $1 , respectively, of interest on capital lease obligations related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. These obligations were assumed by the purchaser of the ITO business. Refer to Note 5 - Divestitures for additional information regarding this sale. (3) Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income. Net Payments on Debt Net (payments) proceeds on debt as shown on the Condensed Consolidated Statements of Cash Flows were as follows: Six Months Ended 2015 2014 Net proceeds on short-term debt $ 514 $ 45 Proceeds from issuance of long-term debt 673 741 Payments on long-term debt (1) (1,284 ) (1,081 ) Net payments on debt $ (97 ) $ (295 ) ____________ (1) Includes current maturities. |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments Interest Rate Risk Management We use interest rate swap agreements to manage our interest rate exposure and to achieve a desired proportion of variable and fixed rate debt. These derivatives may be designated as fair value hedges or cash flow hedges depending on the nature of the risk being hedged. Fair Value Hedges As of June 30, 2015 , pay variable/receive fixed interest rate swaps with notional amounts of $300 and net asset fair value of $5 were designated and accounted for as fair value hedges. The swaps were structured to hedge the fair value of related debt by converting them from fixed rate instruments to variable rate instruments. The following is a summary of our fair value hedges at June 30, 2015 : Debt Instrument Year First Designated Notional Amount Net Fair Value Weighted Average Interest Rate Paid Interest Rate Received Basis Maturity Senior Note 2021 2014 $ 300 $ 5 2.44 % 4.5 % Libor 2021 Foreign Exchange Risk Management We are a global company that is exposed to foreign currency exchange rate fluctuations in the normal course of our business. As a part of our foreign exchange risk management strategy, we use derivative instruments, primarily forward contracts and purchased option contracts, to hedge the following foreign currency exposures, thereby reducing volatility of earnings or protecting fair values of assets and liabilities: • Foreign currency-denominated assets and liabilities • Forecasted purchases and sales in foreign currency Summary of Foreign Exchange Hedging Positions At June 30, 2015 , we had outstanding forward exchange and purchased option contracts with gross notional values of $3,631 , which is reflective of the amounts that are normally outstanding at any point during the year. Approximately 64% of these contracts mature within three months, 14% in three to six months, 21% in six to twelve months, and 1% in more than twelve months. The following is a summary of the primary hedging positions and corresponding fair values as of June 30, 2015 : Currency Hedged (Buy/Sell) Gross Notional Value Fair Value Asset (Liability) (1) Euro/U.K. Pound Sterling $ 902 $ (3 ) U.S. Dollar/U.K. Pound Sterling 591 (5 ) Japanese Yen/U.S. Dollar 464 (15 ) Japanese Yen/Euro 302 (2 ) U.S. Dollar/Euro 280 2 Canadian Dollar/Euro 278 5 U.K. Pound Sterling/Euro 212 1 Swiss Franc/Euro 109 — Euro/U.S. Dollar 75 — Euro/Canadian Dollar 65 1 Indian Rupee/U.S. Dollar 56 — Philippine Peso/U.S. Dollar 51 (1 ) Mexican Peso/U.S. Dollar 40 (2 ) Mexican Peso/Euro 30 (1 ) U.S. Dollar/Canadian Dollar 23 — Swedish Krone/Euro 20 — Euro/Danish Krone 20 — All Other 113 — Total Foreign Exchange Hedging $ 3,631 $ (20 ) __________________ (1) Represents the net receivable (payable) amount included in the Condensed Consolidated Balance Sheet at June 30, 2015 . Foreign Currency Cash Flow Hedges We designate a portion of our foreign currency derivative contracts as cash flow hedges of our foreign currency-denominated inventory purchases, sales and expenses. The net liability fair value of these contracts was $18 and $30 as of June 30, 2015 and December 31, 2014 , respectively. Summary of Derivative Instruments Fair Value The following table provides a summary of the fair value amounts of our derivative instruments: Designation of Derivatives Balance Sheet Location June 30, 2015 December 31, 2014 Derivatives Designated as Hedging Instruments Foreign exchange contracts – forwards Other current assets $ 3 $ 7 Other current liabilities (20 ) (39 ) Foreign currency options Other current assets 2 2 Other current liabilities (3 ) — Interest rate swaps Other long-term assets 5 5 Net Designated Derivative Liability $ (13 ) $ (25 ) Derivatives NOT Designated as Hedging Instruments Foreign exchange contracts – forwards Other current assets $ 13 $ 13 Other current liabilities (15 ) (19 ) Net Undesignated Derivative Liability $ (2 ) $ (6 ) Summary of Derivatives Total Derivative Assets $ 23 $ 27 Total Derivative Liabilities (38 ) (58 ) Net Derivative Liability $ (15 ) $ (31 ) Summary of Derivative Instruments Gains (Losses) Derivative gains (losses) affect the income statement based on whether such derivatives are designated as hedges of underlying exposures. The following is a summary of derivative gains (losses). Designated Derivative Instruments Gains (Losses) The following table provides a summary of gains (losses) on derivative instruments: Three Months Ended Six Months Ended (Loss) Gain on Derivative Instruments 2015 2014 2015 2014 Fair Value Hedges - Interest rate contracts Derivative (loss) gain recognized in interest expense $ (4 ) $ 5 $ — $ 2 Hedged item gain (loss) recognized in interest expense 4 (5 ) — (2 ) Cash Flow Hedges - Foreign exchange forward contracts and options Derivative (loss) gain recognized in OCI (effective portion) $ (24 ) $ 11 $ 7 $ 29 Derivative loss reclassified from AOCI to income - Cost of sales (effective portion) — (8 ) (10 ) (29 ) During the three and six months ended June 30, 2015 and June 30, 2014 , no amount of ineffectiveness was recorded in earnings for these designated cash flow hedges and all components of each derivative’s gain (loss) was included in the assessment of hedge effectiveness. In addition, no amount was recorded for an underlying exposure that did not occur or was not expected to occur. At June 30, 2015 , a net after-tax loss of $12 was recorded in accumulated other comprehensive loss associated with our cash flow hedging activity. The entire balance is expected to be reclassified into net income within the next 12 months, providing an offsetting economic impact against the underlying anticipated transactions. Non-Designated Derivative Instruments Gains (Losses) Non-designated derivative instruments are primarily instruments used to hedge foreign currency-denominated assets and liabilities. They are not designated as hedges since there is a natural offset for the re-measurement of the underlying foreign currency-denominated asset or liability. The following table provides a summary of gains on non-designated derivative instruments: Derivatives NOT Designated as Hedging Instruments Three Months Ended Six Months Ended Location of Derivative Gain (Loss) 2015 2014 2015 2014 Foreign exchange contracts – forwards Other expense – Currency loss, net $ (50 ) $ — $ (35 ) $ — Net currency gains and losses are included in Other expenses, net and include the mark-to-market adjustments of the derivatives not designated as hedging instruments and the related cost of those derivatives as well as the re-measurement of foreign currency-denominated assets and liabilities. During the three and six months ended June 30, 2015 , currency gains (losses), net were $5 and $(1) , respectively. During the three and six months ended June 30, 2014 , currency gains, net were $1 and $0 , respectively. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities The following table represents assets and liabilities measured at fair value on a recurring basis. The basis for the measurement at fair value in all cases is Level 2 – Significant Other Observable Inputs. June 30, 2015 December 31, 2014 Assets: Foreign exchange contracts - forwards $ 16 $ 20 Foreign currency options 2 2 Interest rate swaps 5 5 Deferred compensation investments in cash surrender life insurance 97 94 Deferred compensation investments in mutual funds 34 32 Total $ 154 $ 153 Liabilities: Foreign exchange options $ 3 $ — Foreign exchange contracts - forwards 35 58 Deferred compensation plan liabilities 145 135 Total $ 183 $ 193 We utilize the income approach to measure the fair value for our derivative assets and liabilities. The income approach uses pricing models that rely on market observable inputs such as yield curves, currency exchange rates and forward prices, and therefore are classified as Level 2. Fair value for our deferred compensation plan investments in Company-owned life insurance is reflected at cash surrender value. Fair value for our deferred compensation plan investments in mutual funds is based on quoted market prices for actively traded investments similar to those held by the plan. Fair value for deferred compensation plan liabilities is based on the fair value of investments corresponding to employees’ investment selections, based on quoted prices for similar assets in actively traded markets. Summary of Other Financial Assets and Liabilities Not Measured at Fair Value on a Recurring Basis The estimated fair values of our other financial assets and liabilities not measured at fair value on a recurring basis were as follows: June 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value Cash and cash equivalents $ 1,641 $ 1,641 $ 1,411 $ 1,411 Accounts receivable, net 2,722 2,722 2,652 2,652 Short-term debt 1,648 1,664 1,427 1,417 Long-term debt 5,998 6,262 6,314 6,719 The fair value amounts for Cash and cash equivalents and Accounts receivable, net approximate carrying amounts due to the short maturities of these instruments. The fair value of Short and Long-term debt was estimated based on quoted market prices for publicly-traded securities or on the current rates offered to us for debt of similar maturities. The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at such date. |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Jun. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows: Three Months Ended June 30, Pension Benefits U.S. Plans Non-U.S. Plans Retiree Health Components of Net Periodic Benefit Costs: 2015 2014 2015 2014 2015 2014 Service cost $ 1 $ 3 $ 9 $ 8 $ 2 $ 2 Interest cost 38 38 53 67 8 9 Expected return on plan assets (38 ) (42 ) (74 ) (85 ) — — Recognized net actuarial loss 6 6 21 14 1 — Amortization of prior service credit — (1 ) (2 ) — (8 ) (10 ) Recognized settlement loss 18 13 — — — — Recognized curtailment gain — — — — (22 ) — Defined Benefit Plans 25 17 7 4 (19 ) 1 Defined contribution plans (3) 15 15 11 8 — — Net Periodic Benefit Cost 40 32 18 12 (19 ) 1 Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: Net actuarial (gain) loss (1) (140 ) 100 (2 ) — (58 ) — Amortization of prior service credit — 1 2 — 8 10 Amortization of net actuarial loss (24 ) (19 ) (21 ) (14 ) (1 ) — Curtailment gain - recognition of net prior service credit — — — — 22 — Total Recognized in Other Comprehensive Loss (2) (164 ) 82 (21 ) (14 ) (29 ) 10 Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss $ (124 ) $ 114 $ (3 ) $ (2 ) $ (48 ) $ 11 Six Months Ended June 30, Pension Benefits U.S. Plans Non-U.S. Plans Retiree Health Components of Net Periodic Benefit Costs: 2015 2014 2015 2014 2015 2014 Service cost $ 2 $ 5 $ 17 $ 17 $ 4 $ 4 Interest cost 76 78 106 136 17 18 Expected return on plan assets (76 ) (80 ) (147 ) (172 ) — — Recognized net actuarial loss 13 8 40 28 1 — Amortization of prior service credit (1 ) (1 ) (2 ) (1 ) (15 ) (21 ) Recognized settlement loss 45 25 — — — — Recognized curtailment gain — — — — (22 ) — Defined Benefit Plans 59 35 14 8 (15 ) 1 Defined contribution plans (3) 31 30 20 18 — — Net Periodic Benefit Cost 90 65 34 26 (15 ) 1 Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: Net actuarial (gain) loss (1) (52 ) 297 (2 ) — (58 ) — Amortization of prior service credit 1 1 2 1 15 21 Amortization of net actuarial loss (58 ) (33 ) (40 ) (28 ) (1 ) — Curtailment gain - recognition of net prior service credit — — — — 22 — Total Recognized in Other Comprehensive Loss (2) (109 ) 265 (40 ) (27 ) (22 ) 21 Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss $ (19 ) $ 330 $ (6 ) $ (1 ) $ (37 ) $ 22 _____________________________ (1) The net actuarial (gain) loss for U.S. Plans primarily reflect; i) the remeasurement of our primary U.S. pension plans as a result of the payment of periodic settlements; and ii) adjustments for the actual valuation results based on January 1st plan census data. (2) Amounts represent the pre-tax effect included within Other comprehensive income (loss). Refer to Note 16 - Other Comprehensive Income (Loss) for related tax effects and the after-tax amounts. (3) The six months ended June 30, 2015 and 2014 , exclude defined contribution expense of $4 and $4 , respectively, related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. Plan Amendments In June 2015, we amended our U.S. Retiree Health Plan to eliminate future benefit accruals for active salaried employees effective December 31, 2015. There was no change in benefits for union employees or existing retirees or employees that retire before December 31, 2015. As a result of this plan amendment, we recognized a pre-tax curtailment gain of $ 22 in the second quarter 2015. The gain represents the recognition of deferred gains from other prior-year amendments (“prior service credits”) as a result of the discontinuation of the future benefit or service accrual period for active salaried employees. The amendment is not expected to materially impact Retiree Health expense for the remainder of 2015. Contributions During the six months ended June 30, 2015 , we made cash contributions of $98 ( $13 U.S. and $85 Non-U.S.) to our defined benefit pension plans and $29 to our retiree health benefit plans. We presently anticipate additional cash contributions of $242 ( $167 U.S. and $75 Non-U.S.) to our defined benefit pension plans and $42 to our retiree health benefit plans in 2015 for total full-year cash contributions of approximately $340 ( $180 U.S. and $160 Non-U.S.) to our defined benefit pension plans and $71 to our retiree health benefit plans. In 2014, full-year cash contributions to our defined benefit pension plans were $284 ( $124 U.S. and $160 Non-U.S.) and $70 to our retiree health benefit plans. |
Shareholders Equity
Shareholders Equity | 6 Months Ended |
Jun. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings (4) AOCL (1) Xerox Shareholders’ Equity Non-controlling Interests Total Equity Balance at December 31, 2014 $ 1,124 $ 4,283 $ (105 ) $ 9,535 $ (4,159 ) $ 10,678 $ 75 $ 10,753 Comprehensive income (loss), net — — — 237 (140 ) 97 10 107 Cash dividends declared- common (2) — — — (155 ) — (155 ) — (155 ) Cash dividends declared - preferred (3) — — — (12 ) — (12 ) — (12 ) Stock option and incentive plans, net 3 54 — — — 57 — 57 Payments to acquire treasury stock, including fees — — (611 ) — — (611 ) — (611 ) Cancellation of treasury stock (30 ) (370 ) 400 — — — — — Distributions to noncontrolling interests — — — — — — (42 ) (42 ) Balance at June 30, 2015 $ 1,097 $ 3,967 $ (316 ) $ 9,605 $ (4,299 ) $ 10,054 $ 43 $ 10,097 Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings AOCL (1) Xerox Shareholders’ Equity Non- controlling Interests Total Equity Balance at December 31, 2013 $ 1,210 $ 5,282 $ (252 ) $ 8,839 $ (2,779 ) $ 12,300 $ 119 $ 12,419 Comprehensive income (loss), net — — — 547 (23 ) 524 12 536 Cash dividends declared-common (2) — — — (148 ) — (148 ) — (148 ) Cash dividends declared-preferred (3) — — — (12 ) — (12 ) — (12 ) Conversion of notes to common stock 1 8 — — — 9 — 9 Stock option and incentive plans, net 6 87 — — — 93 — 93 Payments to acquire treasury stock, including fees — — (479 ) — — (479 ) — (479 ) Cancellation of treasury stock (52 ) (531 ) 583 — — — — — Distributions to noncontrolling interests — — — — — — (13 ) (13 ) Balance at June 30, 2014 $ 1,165 $ 4,846 $ (148 ) $ 9,226 $ (2,802 ) $ 12,287 $ 118 $ 12,405 _____________________________ (1) Refer to Note 16 - Other Comprehensive Income (Loss) for components of AOCL. (2) Cash dividends declared on common stock of $0.07 per share in each quarter of 2015 and $0.0625 per share in each quarter of 2014 . (3) Cash dividends declared on preferred stock of $20.00 per share in each quarter of 2015 and 2014 . (4) Balance at December 31, 2014 was revised - Refer to Note 1 - Basis of Presentation for additional information regarding this revision. Treasury Stock The following is a summary of the purchases of common stock made during the six months ended June 30, 2015 under our authorized stock repurchase programs (shares in thousands): Shares Amount December 31, 2014 7,609 $ 105 Purchases (1) 50,081 611 Cancellations (29,862 ) (400 ) June 30, 2015 27,828 $ 316 ____________________________ (1) Includes associated fees. |
Other Comprehensive Loss
Other Comprehensive Loss | 6 Months Ended |
Jun. 30, 2015 | |
Comprehensive Income [Abstract] | |
Other Comprehensive Loss | Other Comprehensive Income (Loss) Other Comprehensive Income (Loss) is comprised of the following: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Pre-tax Net of Tax Pre-tax Net of Tax Pre-tax Net of Tax Pre-tax Net of Tax Translation Adjustments Gains (Losses) $ 191 $ 194 $ 92 $ 92 $ (315 ) $ (315 ) $ 94 $ 91 Unrealized (Losses) Gains: Changes in fair value of cash flow hedges - (losses) gains (24 ) (18 ) 11 7 7 7 29 20 Changes in cash flow hedges reclassed to earnings (1) — (1 ) 8 7 10 4 29 21 Other gains (losses) 1 — 1 1 — (1 ) — — Net Unrealized (Losses) Gains (23 ) (19 ) 20 15 17 10 58 41 Defined Benefit Plans Gains (Losses): Net actuarial gains (losses) 200 123 (100 ) (61 ) 112 69 (297 ) (183 ) Prior service amortization/curtailment (2) (32 ) (19 ) (11 ) (7 ) (40 ) (24 ) (23 ) (14 ) Actuarial loss amortization/settlements (2) 46 32 33 22 99 67 61 41 Fuji Xerox changes in defined benefit plans, net (3) 8 8 3 3 27 27 30 30 Other (losses) gains (4) (76 ) (77 ) (27 ) (27 ) 27 26 (28 ) (28 ) Changes in Defined Benefit Plans Gains (Losses) 146 67 (102 ) (70 ) 225 165 (257 ) (154 ) Other Comprehensive Income (Loss) 314 242 10 37 (73 ) (140 ) (105 ) (22 ) Less: Other comprehensive income attributable to noncontrolling interests 1 1 1 1 — — 1 1 Other Comprehensive Income (Loss) Attributable to Xerox $ 313 $ 241 $ 9 $ 36 $ (73 ) $ (140 ) $ (106 ) $ (23 ) _____________________________ (1) Reclassified to Cost of sales - refer to Note 12 - Financial Instruments for additional information regarding our cash flow hedges. (2) Reclassified to Total Net Periodic Benefit Cost - refer to Note 14 - Employee Benefit Plans for additional information. (3) Represents our share of Fuji Xerox's benefit plan changes. (4) Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL. Accumulated Other Comprehensive Loss (AOCL) AOCL is comprised of the following: June 30, 2015 December 31, 2014 Cumulative translation adjustments $ (2,058 ) $ (1,743 ) Other unrealized losses, net (12 ) (22 ) Benefit plans net actuarial losses and prior service credits (1) (2,229 ) (2,394 ) Total Accumulated Other Comprehensive Loss Attributable to Xerox $ (4,299 ) $ (4,159 ) _____________________________ (1) Includes our share of Fuji Xerox. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The following table sets forth the computation of basic and diluted earnings per share of common stock (shares in thousands): Three Months Ended Six Months Ended 2015 2014 2015 2014 Basic Earnings per Share: Net income from continuing operations attributable to Xerox $ 107 $ 255 $ 298 $ 521 Accrued dividends on preferred stock (6 ) (6 ) (12 ) (12 ) Adjusted Net Income From Continuing Operations Available to Common Shareholders 101 249 286 509 Net (Loss) income from discontinued operations attributable to Xerox (95 ) 11 (61 ) 26 Adjusted Net Income Available to Common Shareholders $ 6 $ 260 $ 225 $ 535 Weighted average common shares outstanding 1,087,720 1,160,842 1,098,370 1,170,177 Basic Earnings per Share: Continuing operations $ 0.09 $ 0.21 $ 0.26 $ 0.43 Discontinued operations (0.08 ) 0.01 (0.06 ) 0.03 Total $ 0.01 $ 0.22 $ 0.20 $ 0.46 Diluted Earnings per Share: Net income from continuing operations attributable to Xerox $ 107 $ 255 $ 298 $ 521 Accrued dividends on preferred stock (6 ) (6 ) (12 ) (12 ) Adjusted Net Income From Continuing Operations Available to Common Shareholders $ 101 $ 249 $ 286 $ 509 Net (Loss) income from discontinued operations attributable to Xerox (95 ) 11 (61 ) 26 Adjusted Net Income Available to Common Shareholders $ 6 $ 260 $ 225 $ 535 Weighted average common shares outstanding 1,087,720 1,160,842 1,098,370 1,170,177 Common shares issuable with respect to: Stock options 1,409 3,116 1,615 3,369 Restricted stock and performance shares 16,140 16,801 15,300 15,792 Convertible preferred stock — — — — Adjusted Weighted Average Common Shares Outstanding 1,105,269 1,180,759 1,115,285 1,189,338 Diluted Earnings per Share: Continuing operations $ 0.09 $ 0.21 $ 0.26 $ 0.43 Discontinued operations (0.08 ) 0.01 (0.06 ) 0.02 Total $ 0.01 $ 0.22 $ 0.20 $ 0.45 The following securities were not included in the computation of diluted earnings per share as they were either contingently issuable shares or shares that if included would have been anti-dilutive: Stock options 2,590 5,566 2,384 5,313 Restricted stock and performance shares 13,981 15,896 14,820 16,905 Convertible preferred stock 26,966 26,966 26,966 26,966 Total Anti-Dilutive Securities 43,537 48,428 44,170 49,184 Dividends per Common Share $ 0.0700 $ 0.0625 $ 0.1400 $ 0.1250 |
Contingencies and Litigation
Contingencies and Litigation | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Litigation | Contingencies and Litigation Legal Matters As more fully discussed below, we are involved in a variety of claims, lawsuits, investigations and proceedings concerning securities law, intellectual property law, environmental law, employment law and the Employee Retirement Income Security Act (ERISA). We determine whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. We assess our potential liability by analyzing our litigation and regulatory matters using available information. We develop our views on estimated losses in consultation with outside counsel handling our defense in these matters, which involves an analysis of potential results, assuming a combination of litigation and settlement strategies. Should developments in any of these matters cause a change in our determination as to an unfavorable outcome and result in the need to recognize a material accrual, or should any of these matters result in a final adverse judgment or be settled for significant amounts, they could have a material adverse effect on our results of operations, cash flows and financial position in the period or periods in which such change in determination, judgment or settlement occurs. Brazil Tax and Labor Contingencies Our Brazilian operations are involved in various litigation matters and have received or been the subject of numerous governmental assessments related to indirect and other taxes, as well as disputes associated with former employees and contract labor. The tax matters, which comprise a significant portion of the total contingencies, principally relate to claims for taxes on the internal transfer of inventory, municipal service taxes on rentals, gross revenue taxes and import taxes and duties. We are disputing these tax matters and intend to vigorously defend our position. Based on the opinion of legal counsel and current reserves for those matters deemed probable of loss, we do not believe that the ultimate resolution of these matters will materially impact our results of operations, financial position or cash flows. The labor matters principally relate to claims made by former employees and contract labor for the equivalent payment of all social security and other related labor benefits, as well as consequential tax claims, as if they were regular employees. As of June 30, 2015 , the total amounts related to the unreserved portion of the tax and labor contingencies, inclusive of any related interest, amounted to approximately $728 , with the decrease from December 31, 2014 balance of approximately $817 primarily related to currency and closed cases partially offset by interest. With respect to the unreserved balance of $728 , the majority has been assessed by management as being remote as to the likelihood of ultimately resulting in a loss to the Company. In connection with the above proceedings, customary local regulations may require us to make escrow cash deposits or post other security of up to half of the total amount in dispute. As of June 30, 2015 , we had $90 of escrow cash deposits for matters we are disputing, and there are liens on certain Brazilian assets with a net book value of $17 and additional letters of credit of approximately $223 , which include associated indexation. Generally, any escrowed amounts would be refundable and any liens would be removed to the extent the matters are resolved in our favor. We routinely assess all these matters as to probability of ultimately incurring a liability against our Brazilian operations and record our best estimate of the ultimate loss in situations where we assess the likelihood of an ultimate loss as probable. Litigation Against the Company State of Texas v. Xerox Corporation, Xerox State Healthcare, LLC, and ACS State Healthcare, LLC, a Xerox Corporation: On May 9, 2014, the State of Texas, via the Texas Office of Attorney General (the “State”), filed a lawsuit in the 53rd Judicial District Court of Travis County, Texas. The lawsuit alleges that Xerox Corporation, Xerox State Healthcare, LLC and ACS State Healthcare (collectively “Xerox” or the "Company”) violated the Texas Medicaid Fraud Prevention Act in the administration of its contract with the Texas Department of Health and Human Services (“HHSC”). The State alleges that the Company made false representations of material facts regarding the processes, procedures, implementation and results regarding the prior authorization of orthodontic claims. The State seeks recovery of actual damages, two times the amount of any overpayments made as a result of unlawful acts, civil penalties, pre- and post-judgment interest and all costs and attorneys’ fees. The State references the amount in controversy as exceeding hundreds of millions of dollars. Xerox filed its Answer in June, 2014 denying all allegations. Xerox will continue to vigorously defend itself in this matter. We do not believe it is probable that we will incur a material loss in excess of the amount accrued for this matter. In the course of litigation, we periodically engage in discussions with plaintiff’s counsel for possible resolution of the matter. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement for a significant amount, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment or settlement occurs. Other Contingencies - We have issued or provided the following guarantees as of June 30, 2015 : • $426 for letters of credit issued to (i) guarantee our performance under certain services contracts; (ii) support certain insurance programs; and (iii) support our obligations related to the Brazil tax and labor contingencies. • $656 for outstanding surety bonds. Certain contracts, primarily those involving public sector customers, require us to provide a surety bond as a guarantee of our performance of contractual obligations. In general, we would only be liable for the amount of these guarantees in the event of default in our performance of our obligations under each contract; the probability of which we believe is remote. We believe that our capacity in the surety markets as well as under various credit arrangements (including our Credit Facility) is sufficient to allow us to respond to future requests for proposals that require such credit support. We have service arrangements where we service third party student loans in the Federal Family Education Loan program (FFEL) on behalf of various financial institutions. We service these loans for investors under outsourcing arrangements and do not acquire any servicing rights that are transferable by us to a third party. At June 30, 2015 , we serviced a FFEL portfolio of approximately 2.5 million loans with an outstanding principal balance of approximately $36.1 billion. Some servicing agreements contain provisions that, under certain circumstances, require us to purchase the loans from the investor if the loan guaranty has been permanently terminated as a result of a loan default caused by our servicing error. If defaults caused by us are cured during an initial period, any obligation we may have to purchase these loans expires. Loans that we purchase may be subsequently cured, the guaranty reinstated and the loans repackaged for sale to third parties. We evaluate our exposure under our purchase obligations on defaulted loans and establish a reserve for potential losses, or default liability reserve, through a charge to the provision for loss on defaulted loans purchased. The reserve is evaluated periodically and adjusted based upon management’s analysis of the historical performance of the defaulted loans. As of June 30, 2015 , other current liabilities included reserves of approximately $3 for losses on defaulted loans purchased. In addition to potential purchase obligations arising from servicing errors, various laws and regulations applicable to student loan borrowers could give rise to fines, penalties and other liabilities associated with loan servicing errors. Indemnifications We have indemnified, subject to certain deductibles and limits, the purchasers of businesses or divested assets for the occurrence of specified events under certain of our divestiture agreements. Where appropriate, an obligation for such indemnifications is recorded as a liability. Since the obligated amounts of these types of indemnifications are often not explicitly stated and/or are contingent on the occurrence of future events, the overall maximum amount of the obligation under such indemnifications cannot be reasonably estimated. Other than obligations recorded as liabilities at the time of divestiture, we have not historically made significant payments for these indemnifications. Additionally, under certain of our acquisition agreements, we have provided for additional consideration to be paid to the sellers if established financial targets are achieved post-closing. We have recognized liabilities for these contingent obligations based on an estimate of the fair value of these contingencies at the time of acquisition. Contingent obligations related to indemnifications arising from our divestitures and contingent consideration provided for by our acquisitions are not expected to be material to our financial position, results of operations or cash flows. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Restatement to Prior Year Income | The following table presents the effect of this correction on our Consolidated Statements of Income for all periods affected: Three Months Ended December 31, 2014 Year Ended December 31, 2014 As Reported As Revised As Reported As Revised Income tax expense $ 78 $ 34 $ 259 $ 215 Income from Continuing Operations 311 355 1,107 1,151 Net Income 162 206 992 1,036 Net Income Attributable to Xerox 156 200 969 1,013 Net Income Attributable to Xerox - continuing operations 305 349 1,084 1,128 Basic Earnings per Share: Continuing Operations $ 0.26 $ 0.30 $ 0.92 $ 0.96 Total Basic Earnings per Share 0.13 0.17 0.82 0.86 Diluted Earnings per Share: Continuing Operations $ 0.26 $ 0.30 $ 0.90 $ 0.94 Total Diluted Earnings per Share 0.13 0.17 0.81 0.85 |
Restatement to Prior Year Balance Sheet | The following table presents the effect this correction had on our Consolidated Balance Sheet at December 31, 2014: December 31, 2014 As Reported As Revised Other long-term liabilities $ 498 $ 454 Total Liabilities 16,600 16,556 Retained earnings 9,491 9,535 Xerox shareholders' equity 10,634 10,678 Total Equity 10,709 10,753 |
Restatement to Prior Year Cash Flow | The correction did not have an effect on the Company’s operating cash flows. The following table presents the effect on the individual line items within operating cash flows of our Consolidated Statement of Cash Flows for the year ended December 31, 2014: Year Ended December 31, 2014 As Reported As Revised Net income $ 992 $ 1,036 Net change in income tax assets and liabilities 29 (15 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Operating segment revenues and profitability | Operating segment revenues and profitability were as follows: Three Months Ended Six Months Ended Segment Revenue Segment Profit (Loss) Segment Revenue Segment Profit(Loss) 2015 Services $ 2,569 $ 192 $ 5,083 $ 381 Document Technology 1,880 228 3,710 431 Other 141 (76 ) 266 (138 ) Total $ 4,590 $ 344 $ 9,059 $ 674 2014 Services $ 2,651 $ 226 $ 5,236 $ 448 Document Technology 2,126 306 4,170 555 Other 164 (75 ) 306 (125 ) Total $ 4,941 $ 457 $ 9,712 $ 878 |
Reconciliation to pre-tax income (loss) | Three Months Ended Six Months Ended Reconciliation to Pre-tax Income 2015 2014 2015 2014 Segment Profit $ 344 $ 457 $ 674 $ 878 Reconciling items: Restructuring and asset impairment charges, and related costs (1) (160 ) (46 ) (178 ) (75 ) Restructuring charges of Fuji Xerox (1 ) 1 (2 ) (2 ) Amortization of intangible assets (79 ) (78 ) (156 ) (155 ) Equity in net income of unconsolidated affiliates (29 ) (33 ) (63 ) (75 ) Other (1 ) — — 1 Pre-tax Income $ 74 $ 301 $ 275 $ 572 __________________________ (1) Includes business transformation costs of $3 and $7 for the three months ended June 30, 2015 and June 30, 2014 , respectively, and $7 and $10 for the six months ended June 30, 2015 and June 30, 2014, respectively. Business transformation costs represent incremental costs incurred directly in support of our business transformation and restructuring initiatives such as compensation costs for overlapping staff, consulting costs and training costs. |
Divestitures (Tables)
Divestitures (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summarized Financial Information - Discontinued Operations | Summarized financial information for our Discontinued Operations is as follows : Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 ITO Other Total ITO Other Total ITO Other Total ITO Other Total Revenues $ 308 $ — $ 308 $ 341 $ 17 $ 358 $ 619 $ — $ 619 $ 669 $ 38 $ 707 Income (loss) from operations (1), (2) 43 — 43 23 — 23 104 — 104 44 (1 ) 43 Loss on disposal (68 ) — (68 ) — (2 ) (2 ) (72 ) — (72 ) — — — Net (loss) income before income taxes $ (25 ) $ — $ (25 ) $ 23 $ (2 ) $ 21 $ 32 $ — $ 32 $ 44 $ (1 ) $ 43 Income tax expense (70 ) — (70 ) (9 ) (1 ) (10 ) (93 ) — (93 ) (16 ) (1 ) (17 ) (Loss) income from discontinued operations, net of tax $ (95 ) $ — $ (95 ) $ 14 $ (3 ) $ 11 $ (61 ) $ — $ (61 ) $ 28 $ (2 ) $ 26 _______________ (1) ITO Income from operations excludes depreciation and amortization expenses of approximately $ 41 and $ 80 (including $ 7 and $ 14 for intangible amortization) for the three and six months ended June 30, 2015, respectively, since the business was held for sale. (2) ITO Income from operations includes intangible amortization and other expenses of approximately $8 and $16 for the three and six months ended June 30, 2014 , respectively. |
Discontinued operations - Balance Sheet | The following is a summary of the major categories of assets and liabilities of the ITO business held for sale at December 31, 2014: December 31, 2014 Accounts receivable, net $ 213 Other current assets 146 Land, buildings and equipment, net 220 Intangible assets, net 197 Goodwill 337 Other long-term assets 147 Total Assets of Discontinued Operations $ 1,260 Current portion of long-term debt $ 31 Accounts payable 32 Accrued pension and benefit costs 9 Unearned income 64 Other current liabilities 112 Long-term debt 44 Pension and other benefit liabilities 25 Other long-term liabilities 54 Total Liabilities of Discontinued Operations $ 371 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Receivables [Abstract] | |
Schedule of accounts receivable, net | Accounts receivable, net were as follows: June 30, 2015 December 31, 2014 Amounts billed or billable $ 2,485 $ 2,421 Unbilled amounts 319 318 Allowance for doubtful accounts (82 ) (87 ) Accounts Receivable, Net $ 2,722 $ 2,652 |
Schedule of accounts receivables sales | Accounts receivable sales were as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Accounts receivable sales $ 586 $ 726 $ 1,188 $ 1,548 Deferred proceeds 57 96 119 220 Loss on sales of accounts receivable 3 4 6 8 Estimated decrease to operating cash flows (1) (27 ) (31 ) (10 ) (20 ) __________________________ (1) Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency. |
Finance Receivables, Net (Table
Finance Receivables, Net (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Financing Receivable, Net [Abstract] | |
Finance Receivables Sales Activity | The following is a summary of our prior sales activity. Year Ended December 31, 2013 2012 Net carrying value (NCV) sold $ 676 $ 682 Allowance included in NCV 17 18 Cash proceeds received 635 630 Beneficial interests received 86 101 Pre-tax gain on sales 40 44 Net fees and expenses 5 5 |
Finance Receivables Sales Impact on Operating Cash Flows | The net impact from the sales of finance receivables on operating cash flows is summarized below: Three Months Ended Six Months Ended 2015 2014 2015 2014 Impact from prior sales of finance receivables (1) $ (89 ) $ (137 ) $ (194 ) $ (286 ) Collections on beneficial interest 15 25 33 51 Estimated Decrease to Operating Cash Flows $ (74 ) $ (112 ) $ (161 ) $ (235 ) ____________________________ (1) Represents cash that would have been collected had we not sold finance receivables. |
Allowance for Credit Losses on Financing Receivables | The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables: Allowance for Credit Losses: United States Canada Europe Other (3) Total Balance at December 31, 2014 $ 41 $ 20 $ 58 $ 12 $ 131 Provision 2 1 5 3 11 Charge-offs — (3 ) (1 ) (1 ) (5 ) Recoveries and other (1) — — (6 ) — (6 ) Balance at March 31, 2015 $ 43 $ 18 $ 56 $ 14 $ 131 Provision 1 1 6 2 10 Charge-offs (1 ) (2 ) (5 ) (2 ) (10 ) Recoveries and other (1) (1 ) 1 3 — 3 Balance at June 30, 2015 $ 42 $ 18 $ 60 $ 14 $ 134 Finance receivables as of June 30, 2015 collectively evaluated for impairment (2) $ 1,710 $ 397 $ 1,619 $ 430 $ 4,156 Balance at December 31, 2013 $ 45 $ 22 $ 81 $ 6 $ 154 Provision 3 2 7 3 15 Charge-offs (1 ) (4 ) (5 ) (2 ) (12 ) Recoveries and other (1) 1 — — — 1 Balance at March 31, 2014 $ 48 $ 20 $ 83 $ 7 $ 158 Provision 1 2 11 1 15 Charge-offs — (4 ) (8 ) 1 (11 ) Recoveries and other (1) — 2 — — 2 Balance at June 30, 2014 $ 49 $ 20 $ 86 $ 9 $ 164 Finance receivables as of June 30, 2014 collectively evaluated for impairment (2) $ 1,684 $ 421 $ 2,170 $ 339 $ 4,614 __________________ (1) Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations. (2) Total Finance receivables exclude the allowance for credit losses of $134 and $164 at June 30, 2015 and 2014 , respectively. (3) Includes developing market countries and smaller units. |
Financing Receivable Credit Quality Indicators | Details about our finance receivables portfolio based on industry and credit quality indicators are as follows: June 30, 2015 December 31, 2014 Investment Grade Non-investment Grade Substandard Total Finance Receivables Investment Grade Non-investment Grade Substandard Total Finance Receivables Finance and other services $ 191 $ 177 $ 59 $ 427 $ 195 $ 159 $ 55 $ 409 Government and education 556 13 4 573 589 13 3 605 Graphic arts 150 81 83 314 148 79 90 317 Industrial 91 41 16 148 92 41 18 151 Healthcare 87 25 14 126 84 26 14 124 Other 55 40 27 122 55 38 29 122 Total United States 1,130 377 203 1,710 1,163 356 209 1,728 Finance and other services 55 34 11 100 54 31 12 97 Government and education 67 8 2 77 76 8 2 86 Graphic arts 51 41 29 121 58 49 36 143 Industrial 24 13 4 41 24 13 4 41 Other 35 20 3 58 34 19 4 57 Total Canada 232 116 49 397 246 120 58 424 France 224 208 109 541 253 234 129 616 U.K./Ireland 246 95 4 345 255 101 6 362 Central (1) 217 216 28 461 230 278 30 538 Southern (2) 31 145 30 206 60 148 36 244 Nordics (3) 23 43 — 66 25 49 1 75 Total Europe 741 707 171 1,619 823 810 202 1,835 Other 167 205 58 430 195 163 40 398 Total $ 2,270 $ 1,405 $ 481 $ 4,156 $ 2,427 $ 1,449 $ 509 $ 4,385 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. |
Finance Receivables Aging | The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows: June 30, 2015 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 2 $ 11 $ 416 $ 427 $ 12 Government and education 16 3 3 22 551 573 25 Graphic arts 14 1 1 16 298 314 8 Industrial 4 1 1 6 142 148 7 Healthcare 3 1 1 5 121 126 5 Other 4 — — 4 118 122 4 Total United States 48 8 8 64 1,646 1,710 61 Canada 9 2 1 12 385 397 11 France — — 1 1 540 541 31 U.K./Ireland 2 1 — 3 342 345 1 Central (1) 4 2 1 7 454 461 6 Southern (2) 12 4 3 19 187 206 10 Nordics (3) 1 — — 1 65 66 3 Total Europe 19 7 5 31 1,588 1,619 51 Other 13 2 — 15 415 430 — Total $ 89 $ 19 $ 14 $ 122 $ 4,034 $ 4,156 $ 123 December 31, 2014 Current 31-90 Days Past Due >90 Days Past Due Total Billed Unbilled Total Finance Receivables >90 Days and Accruing Finance and other services $ 7 $ 2 $ 1 $ 10 $ 399 $ 409 $ 13 Government and education 14 4 3 21 584 605 25 Graphic arts 12 1 1 14 303 317 6 Industrial 4 1 1 6 145 151 9 Healthcare 3 1 — 4 120 124 5 Other 3 1 — 4 118 122 6 Total United States 43 10 6 59 1,669 1,728 64 Canada 9 2 1 12 412 424 17 France — 1 2 3 613 616 35 U.K./Ireland 1 — — 1 361 362 1 Central (1) 2 2 1 5 533 538 15 Southern (2) 14 4 4 22 222 244 17 Nordics (3) 1 — — 1 74 75 2 Total Europe 18 7 7 32 1,803 1,835 70 Other 13 1 — 14 384 398 — Total $ 83 $ 20 $ 14 $ 117 $ 4,268 $ 4,385 $ 151 _____________________________ (1) Switzerland, Germany, Austria, Belgium and Holland. (2) Italy, Greece, Spain and Portugal. (3) Sweden, Norway, Denmark and Finland. |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | The following is a summary of Inventories by major category: June 30, 2015 December 31, 2014 Finished goods $ 895 $ 778 Work-in-process 66 58 Raw materials 111 98 Total Inventories $ 1,072 $ 934 |
Investment in Affiliates, at 30
Investment in Affiliates, at Equity (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity in net income (loss) of unconsolidated affiliates | Our equity in net income of unconsolidated affiliates was as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Fuji Xerox $ 25 $ 31 $ 56 $ 70 Other investments 4 2 7 5 Total Equity in Net Income of Unconsolidated Affiliates $ 29 $ 33 $ 63 $ 75 |
Condensed Financial Information Of Equity Investment - Fuji Xerox | Condensed financial data of Fuji Xerox was as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Summary of Operations: Revenues $ 2,389 $ 2,707 $ 5,120 $ 5,728 Costs and expenses 2,211 2,510 4,731 5,311 Income before income taxes 178 197 389 417 Income tax expense 63 67 129 125 Net Income 115 130 260 292 Less: Net income – noncontrolling interests 2 1 4 2 Net Income – Fuji Xerox $ 113 $ 129 $ 256 $ 290 Weighted Average Exchange Rate (1) 121.39 102.13 120.27 102.41 _____________________________ (1) Represents Yen/U.S. Dollar exchange rate used to translate. |
Restructuring Programs (Tables)
Restructuring Programs (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Program Activity | Information related to restructuring program activity during the six months ended June 30, 2015 is outlined below: Severance and Related Costs Lease Cancellation and Other Costs Asset Impairments (2) Total Balance at December 31, 2014 $ 93 $ 4 $ — $ 97 Provision 38 3 146 187 Reversals (13 ) (3 ) — (16 ) Net Current Period Charges (1) 25 — 146 171 Charges against reserve and currency (65 ) (1 ) (146 ) (212 ) Balance at June 30, 2015 $ 53 $ 3 $ — $ 56 _____________________________ (1) Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown. (2) Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision. |
Reconciliation to the Condensed Consolidated Statements Of Cash Flows | Reconciliation to the Condensed Consolidated Statements of Cash Flows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Charges against reserve $ (175 ) $ (40 ) $ (212 ) $ (81 ) Asset impairments 146 3 146 7 Effects of foreign currency and other non-cash items (1 ) 1 5 2 Restructuring Cash Payments $ (30 ) $ (36 ) $ (61 ) $ (72 ) |
Total Costs incurred with Restructuring programs, by segment | The following table summarizes the total amount of costs incurred in connection with these restructuring programs by segment: Three Months Ended Six Months Ended 2015 2014 2015 2014 Services (1)(2) $ 149 $ 5 $ 154 $ 14 Document Technology 8 26 17 42 Other — 8 — 9 Total Net Restructuring Charges $ 157 $ 39 $ 171 $ 65 _____________________________ (1) The three months ended June 30,2015 includes $146 of software asset impairment charges. (2) The three months ended June 30, 2014 excludes $ (1) related to the ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule Of Interest Expense And Interest Income | Interest expense and interest income were as follows: Three Months Ended Six Months Ended 2015 2014 2015 2014 Interest expense (1),(2) $ 88 $ 96 $ 177 $ 195 Interest income (3) 89 101 181 203 ____________ (1) Includes Equipment financing interest as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income. (2) The six months ended June 30, 2015 and 2014 exclude $2 and $1 , respectively, of interest on capital lease obligations related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. These obligations were assumed by the purchaser of the ITO business. Refer to Note 5 - Divestitures for additional information regarding this sale. (3) Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income. |
Net Payments/Proceeds on Debt | Net (payments) proceeds on debt as shown on the Condensed Consolidated Statements of Cash Flows were as follows: Six Months Ended 2015 2014 Net proceeds on short-term debt $ 514 $ 45 Proceeds from issuance of long-term debt 673 741 Payments on long-term debt (1) (1,284 ) (1,081 ) Net payments on debt $ (97 ) $ (295 ) ____________ (1) Includes current maturities. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Interest Rate Derivatives | The following is a summary of our fair value hedges at June 30, 2015 : Debt Instrument Year First Designated Notional Amount Net Fair Value Weighted Average Interest Rate Paid Interest Rate Received Basis Maturity Senior Note 2021 2014 $ 300 $ 5 2.44 % 4.5 % Libor 2021 |
Forward Foreign Exchange Contracts - currency pairs | The following is a summary of the primary hedging positions and corresponding fair values as of June 30, 2015 : Currency Hedged (Buy/Sell) Gross Notional Value Fair Value Asset (Liability) (1) Euro/U.K. Pound Sterling $ 902 $ (3 ) U.S. Dollar/U.K. Pound Sterling 591 (5 ) Japanese Yen/U.S. Dollar 464 (15 ) Japanese Yen/Euro 302 (2 ) U.S. Dollar/Euro 280 2 Canadian Dollar/Euro 278 5 U.K. Pound Sterling/Euro 212 1 Swiss Franc/Euro 109 — Euro/U.S. Dollar 75 — Euro/Canadian Dollar 65 1 Indian Rupee/U.S. Dollar 56 — Philippine Peso/U.S. Dollar 51 (1 ) Mexican Peso/U.S. Dollar 40 (2 ) Mexican Peso/Euro 30 (1 ) U.S. Dollar/Canadian Dollar 23 — Swedish Krone/Euro 20 — Euro/Danish Krone 20 — All Other 113 — Total Foreign Exchange Hedging $ 3,631 $ (20 ) __________________ (1) Represents the net receivable (payable) amount included in the Condensed Consolidated Balance Sheet at June 30, 2015 . |
Summary of Derivative Instruments Fair Value | The following table provides a summary of the fair value amounts of our derivative instruments: Designation of Derivatives Balance Sheet Location June 30, 2015 December 31, 2014 Derivatives Designated as Hedging Instruments Foreign exchange contracts – forwards Other current assets $ 3 $ 7 Other current liabilities (20 ) (39 ) Foreign currency options Other current assets 2 2 Other current liabilities (3 ) — Interest rate swaps Other long-term assets 5 5 Net Designated Derivative Liability $ (13 ) $ (25 ) Derivatives NOT Designated as Hedging Instruments Foreign exchange contracts – forwards Other current assets $ 13 $ 13 Other current liabilities (15 ) (19 ) Net Undesignated Derivative Liability $ (2 ) $ (6 ) Summary of Derivatives Total Derivative Assets $ 23 $ 27 Total Derivative Liabilities (38 ) (58 ) Net Derivative Liability $ (15 ) $ (31 ) |
Derivative Instruments, Gain (Loss) | The following table provides a summary of gains (losses) on derivative instruments: Three Months Ended Six Months Ended (Loss) Gain on Derivative Instruments 2015 2014 2015 2014 Fair Value Hedges - Interest rate contracts Derivative (loss) gain recognized in interest expense $ (4 ) $ 5 $ — $ 2 Hedged item gain (loss) recognized in interest expense 4 (5 ) — (2 ) Cash Flow Hedges - Foreign exchange forward contracts and options Derivative (loss) gain recognized in OCI (effective portion) $ (24 ) $ 11 $ 7 $ 29 Derivative loss reclassified from AOCI to income - Cost of sales (effective portion) — (8 ) (10 ) (29 ) |
Summary of Derivatives Not Designated as Hedging Instruments Gains (Losses) | The following table provides a summary of gains on non-designated derivative instruments: Derivatives NOT Designated as Hedging Instruments Three Months Ended Six Months Ended Location of Derivative Gain (Loss) 2015 2014 2015 2014 Foreign exchange contracts – forwards Other expense – Currency loss, net $ (50 ) $ — $ (35 ) $ — |
Fair Value of Financial Asset34
Fair Value of Financial Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial assets and liabilities | The following table represents assets and liabilities measured at fair value on a recurring basis. The basis for the measurement at fair value in all cases is Level 2 – Significant Other Observable Inputs. June 30, 2015 December 31, 2014 Assets: Foreign exchange contracts - forwards $ 16 $ 20 Foreign currency options 2 2 Interest rate swaps 5 5 Deferred compensation investments in cash surrender life insurance 97 94 Deferred compensation investments in mutual funds 34 32 Total $ 154 $ 153 Liabilities: Foreign exchange options $ 3 $ — Foreign exchange contracts - forwards 35 58 Deferred compensation plan liabilities 145 135 Total $ 183 $ 193 |
Estimated fair values of financial assets and liabilities not measured at fair value on a recurring basis | The estimated fair values of our other financial assets and liabilities not measured at fair value on a recurring basis were as follows: June 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value Cash and cash equivalents $ 1,641 $ 1,641 $ 1,411 $ 1,411 Accounts receivable, net 2,722 2,722 2,652 2,652 Short-term debt 1,648 1,664 1,427 1,417 Long-term debt 5,998 6,262 6,314 6,719 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of net periodic benefit cost and other changes in plan assets and benefit obligations | The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows: Three Months Ended June 30, Pension Benefits U.S. Plans Non-U.S. Plans Retiree Health Components of Net Periodic Benefit Costs: 2015 2014 2015 2014 2015 2014 Service cost $ 1 $ 3 $ 9 $ 8 $ 2 $ 2 Interest cost 38 38 53 67 8 9 Expected return on plan assets (38 ) (42 ) (74 ) (85 ) — — Recognized net actuarial loss 6 6 21 14 1 — Amortization of prior service credit — (1 ) (2 ) — (8 ) (10 ) Recognized settlement loss 18 13 — — — — Recognized curtailment gain — — — — (22 ) — Defined Benefit Plans 25 17 7 4 (19 ) 1 Defined contribution plans (3) 15 15 11 8 — — Net Periodic Benefit Cost 40 32 18 12 (19 ) 1 Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: Net actuarial (gain) loss (1) (140 ) 100 (2 ) — (58 ) — Amortization of prior service credit — 1 2 — 8 10 Amortization of net actuarial loss (24 ) (19 ) (21 ) (14 ) (1 ) — Curtailment gain - recognition of net prior service credit — — — — 22 — Total Recognized in Other Comprehensive Loss (2) (164 ) 82 (21 ) (14 ) (29 ) 10 Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss $ (124 ) $ 114 $ (3 ) $ (2 ) $ (48 ) $ 11 Six Months Ended June 30, Pension Benefits U.S. Plans Non-U.S. Plans Retiree Health Components of Net Periodic Benefit Costs: 2015 2014 2015 2014 2015 2014 Service cost $ 2 $ 5 $ 17 $ 17 $ 4 $ 4 Interest cost 76 78 106 136 17 18 Expected return on plan assets (76 ) (80 ) (147 ) (172 ) — — Recognized net actuarial loss 13 8 40 28 1 — Amortization of prior service credit (1 ) (1 ) (2 ) (1 ) (15 ) (21 ) Recognized settlement loss 45 25 — — — — Recognized curtailment gain — — — — (22 ) — Defined Benefit Plans 59 35 14 8 (15 ) 1 Defined contribution plans (3) 31 30 20 18 — — Net Periodic Benefit Cost 90 65 34 26 (15 ) 1 Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: Net actuarial (gain) loss (1) (52 ) 297 (2 ) — (58 ) — Amortization of prior service credit 1 1 2 1 15 21 Amortization of net actuarial loss (58 ) (33 ) (40 ) (28 ) (1 ) — Curtailment gain - recognition of net prior service credit — — — — 22 — Total Recognized in Other Comprehensive Loss (2) (109 ) 265 (40 ) (27 ) (22 ) 21 Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss $ (19 ) $ 330 $ (6 ) $ (1 ) $ (37 ) $ 22 _____________________________ (1) The net actuarial (gain) loss for U.S. Plans primarily reflect; i) the remeasurement of our primary U.S. pension plans as a result of the payment of periodic settlements; and ii) adjustments for the actual valuation results based on January 1st plan census data. (2) Amounts represent the pre-tax effect included within Other comprehensive income (loss). Refer to Note 16 - Other Comprehensive Income (Loss) for related tax effects and the after-tax amounts. (3) The six months ended June 30, 2015 and 2014 , exclude defined contribution expense of $4 and $4 , respectively, related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. |
Shareholders Equity (Tables)
Shareholders Equity (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders Equity | Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings (4) AOCL (1) Xerox Shareholders’ Equity Non-controlling Interests Total Equity Balance at December 31, 2014 $ 1,124 $ 4,283 $ (105 ) $ 9,535 $ (4,159 ) $ 10,678 $ 75 $ 10,753 Comprehensive income (loss), net — — — 237 (140 ) 97 10 107 Cash dividends declared- common (2) — — — (155 ) — (155 ) — (155 ) Cash dividends declared - preferred (3) — — — (12 ) — (12 ) — (12 ) Stock option and incentive plans, net 3 54 — — — 57 — 57 Payments to acquire treasury stock, including fees — — (611 ) — — (611 ) — (611 ) Cancellation of treasury stock (30 ) (370 ) 400 — — — — — Distributions to noncontrolling interests — — — — — — (42 ) (42 ) Balance at June 30, 2015 $ 1,097 $ 3,967 $ (316 ) $ 9,605 $ (4,299 ) $ 10,054 $ 43 $ 10,097 Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings AOCL (1) Xerox Shareholders’ Equity Non- controlling Interests Total Equity Balance at December 31, 2013 $ 1,210 $ 5,282 $ (252 ) $ 8,839 $ (2,779 ) $ 12,300 $ 119 $ 12,419 Comprehensive income (loss), net — — — 547 (23 ) 524 12 536 Cash dividends declared-common (2) — — — (148 ) — (148 ) — (148 ) Cash dividends declared-preferred (3) — — — (12 ) — (12 ) — (12 ) Conversion of notes to common stock 1 8 — — — 9 — 9 Stock option and incentive plans, net 6 87 — — — 93 — 93 Payments to acquire treasury stock, including fees — — (479 ) — — (479 ) — (479 ) Cancellation of treasury stock (52 ) (531 ) 583 — — — — — Distributions to noncontrolling interests — — — — — — (13 ) (13 ) Balance at June 30, 2014 $ 1,165 $ 4,846 $ (148 ) $ 9,226 $ (2,802 ) $ 12,287 $ 118 $ 12,405 _____________________________ (1) Refer to Note 16 - Other Comprehensive Income (Loss) for components of AOCL. (2) Cash dividends declared on common stock of $0.07 per share in each quarter of 2015 and $0.0625 per share in each quarter of 2014 . (3) Cash dividends declared on preferred stock of $20.00 per share in each quarter of 2015 and 2014 . (4) Balance at December 31, 2014 was revised - Refer to Note 1 - Basis of Presentation for additional information regarding this revision. |
Schedule of Treasury Stock by Class | The following is a summary of the purchases of common stock made during the six months ended June 30, 2015 under our authorized stock repurchase programs (shares in thousands): Shares Amount December 31, 2014 7,609 $ 105 Purchases (1) 50,081 611 Cancellations (29,862 ) (400 ) June 30, 2015 27,828 $ 316 ____________________________ (1) Includes associated fees. |
Other Comprehensive Loss (Table
Other Comprehensive Loss (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Comprehensive Income [Abstract] | |
Schedule of Comprehensive Income (Loss) | Other Comprehensive Income (Loss) is comprised of the following: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Pre-tax Net of Tax Pre-tax Net of Tax Pre-tax Net of Tax Pre-tax Net of Tax Translation Adjustments Gains (Losses) $ 191 $ 194 $ 92 $ 92 $ (315 ) $ (315 ) $ 94 $ 91 Unrealized (Losses) Gains: Changes in fair value of cash flow hedges - (losses) gains (24 ) (18 ) 11 7 7 7 29 20 Changes in cash flow hedges reclassed to earnings (1) — (1 ) 8 7 10 4 29 21 Other gains (losses) 1 — 1 1 — (1 ) — — Net Unrealized (Losses) Gains (23 ) (19 ) 20 15 17 10 58 41 Defined Benefit Plans Gains (Losses): Net actuarial gains (losses) 200 123 (100 ) (61 ) 112 69 (297 ) (183 ) Prior service amortization/curtailment (2) (32 ) (19 ) (11 ) (7 ) (40 ) (24 ) (23 ) (14 ) Actuarial loss amortization/settlements (2) 46 32 33 22 99 67 61 41 Fuji Xerox changes in defined benefit plans, net (3) 8 8 3 3 27 27 30 30 Other (losses) gains (4) (76 ) (77 ) (27 ) (27 ) 27 26 (28 ) (28 ) Changes in Defined Benefit Plans Gains (Losses) 146 67 (102 ) (70 ) 225 165 (257 ) (154 ) Other Comprehensive Income (Loss) 314 242 10 37 (73 ) (140 ) (105 ) (22 ) Less: Other comprehensive income attributable to noncontrolling interests 1 1 1 1 — — 1 1 Other Comprehensive Income (Loss) Attributable to Xerox $ 313 $ 241 $ 9 $ 36 $ (73 ) $ (140 ) $ (106 ) $ (23 ) _____________________________ (1) Reclassified to Cost of sales - refer to Note 12 - Financial Instruments for additional information regarding our cash flow hedges. (2) Reclassified to Total Net Periodic Benefit Cost - refer to Note 14 - Employee Benefit Plans for additional information. (3) Represents our share of Fuji Xerox's benefit plan changes. (4) Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL. |
Schedule of Accumulated Other Comprehensive Loss | AOCL is comprised of the following: June 30, 2015 December 31, 2014 Cumulative translation adjustments $ (2,058 ) $ (1,743 ) Other unrealized losses, net (12 ) (22 ) Benefit plans net actuarial losses and prior service credits (1) (2,229 ) (2,394 ) Total Accumulated Other Comprehensive Loss Attributable to Xerox $ (4,299 ) $ (4,159 ) _____________________________ (1) Includes our share of Fuji Xerox. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earnings per Share | The following table sets forth the computation of basic and diluted earnings per share of common stock (shares in thousands): Three Months Ended Six Months Ended 2015 2014 2015 2014 Basic Earnings per Share: Net income from continuing operations attributable to Xerox $ 107 $ 255 $ 298 $ 521 Accrued dividends on preferred stock (6 ) (6 ) (12 ) (12 ) Adjusted Net Income From Continuing Operations Available to Common Shareholders 101 249 286 509 Net (Loss) income from discontinued operations attributable to Xerox (95 ) 11 (61 ) 26 Adjusted Net Income Available to Common Shareholders $ 6 $ 260 $ 225 $ 535 Weighted average common shares outstanding 1,087,720 1,160,842 1,098,370 1,170,177 Basic Earnings per Share: Continuing operations $ 0.09 $ 0.21 $ 0.26 $ 0.43 Discontinued operations (0.08 ) 0.01 (0.06 ) 0.03 Total $ 0.01 $ 0.22 $ 0.20 $ 0.46 Diluted Earnings per Share: Net income from continuing operations attributable to Xerox $ 107 $ 255 $ 298 $ 521 Accrued dividends on preferred stock (6 ) (6 ) (12 ) (12 ) Adjusted Net Income From Continuing Operations Available to Common Shareholders $ 101 $ 249 $ 286 $ 509 Net (Loss) income from discontinued operations attributable to Xerox (95 ) 11 (61 ) 26 Adjusted Net Income Available to Common Shareholders $ 6 $ 260 $ 225 $ 535 Weighted average common shares outstanding 1,087,720 1,160,842 1,098,370 1,170,177 Common shares issuable with respect to: Stock options 1,409 3,116 1,615 3,369 Restricted stock and performance shares 16,140 16,801 15,300 15,792 Convertible preferred stock — — — — Adjusted Weighted Average Common Shares Outstanding 1,105,269 1,180,759 1,115,285 1,189,338 Diluted Earnings per Share: Continuing operations $ 0.09 $ 0.21 $ 0.26 $ 0.43 Discontinued operations (0.08 ) 0.01 (0.06 ) 0.02 Total $ 0.01 $ 0.22 $ 0.20 $ 0.45 The following securities were not included in the computation of diluted earnings per share as they were either contingently issuable shares or shares that if included would have been anti-dilutive: Stock options 2,590 5,566 2,384 5,313 Restricted stock and performance shares 13,981 15,896 14,820 16,905 Convertible preferred stock 26,966 26,966 26,966 26,966 Total Anti-Dilutive Securities 43,537 48,428 44,170 49,184 Dividends per Common Share $ 0.0700 $ 0.0625 $ 0.1400 $ 0.1250 |
Basis of Presentation, Deferred
Basis of Presentation, Deferred Tax Liability on Undistributed Earnings - Fuji Xerox (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Deferred Tax Liabilities, Undistributed Foreign Earnings | $ 44 | $ 44 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Income tax expense | $ (9) | $ 73 | $ 30 | $ 115 | |||||
Income from Continuing Operations | 112 | 261 | 308 | 532 | |||||
Net income | 17 | 272 | 247 | 558 | |||||
Net Income Attributable to Xerox | 12 | 266 | 237 | 547 | |||||
Net income from continuing operations | $ 107 | $ 255 | $ 298 | $ 521 | |||||
Continuing Operations (dollars per share) | $ 0.09 | $ 0.21 | $ 0.26 | $ 0.43 | |||||
Total Basic Earnings per Share (dollars per share) | 0.01 | 0.22 | 0.20 | 0.46 | |||||
Continuing operations (dollars per share) | 0.09 | 0.21 | 0.26 | 0.43 | |||||
Total Diluted Earnings per Share (dollars per share) | $ 0.01 | $ 0.22 | $ 0.20 | $ 0.45 | |||||
Other long-term liabilities | $ 418 | 454 | [1] | $ 418 | 454 | [1] | |||
Total Liabilities | 15,570 | 16,556 | [1] | 15,570 | 16,556 | [1] | |||
Retained earnings | 9,605 | 9,535 | [1] | 9,605 | 9,535 | [1] | |||
Xerox shareholders' equity | 10,054 | 10,678 | [1] | 10,054 | 10,678 | [1] | |||
Total Equity | 10,097 | 10,753 | [1],[2] | $ 12,405 | 10,097 | $ 12,405 | 10,753 | [1],[2] | $ 12,419 |
Net change in income tax assets and liabilities | $ 17 | $ 43 | $ 49 | $ 72 | |||||
Scenario, Adjustment [Member] | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Income tax expense | 34 | 215 | |||||||
Income from Continuing Operations | 355 | 1,151 | |||||||
Net income | 206 | 1,036 | |||||||
Net Income Attributable to Xerox | 200 | 1,013 | |||||||
Net income from continuing operations | $ 349 | $ 1,128 | |||||||
Continuing Operations (dollars per share) | $ 0.30 | $ 0.96 | |||||||
Total Basic Earnings per Share (dollars per share) | 0.17 | 0.86 | |||||||
Continuing operations (dollars per share) | 0.30 | 0.94 | |||||||
Total Diluted Earnings per Share (dollars per share) | $ 0.17 | $ 0.85 | |||||||
Other long-term liabilities | $ 454 | $ 454 | |||||||
Total Liabilities | 16,556 | 16,556 | |||||||
Retained earnings | 9,535 | 9,535 | |||||||
Xerox shareholders' equity | 10,678 | 10,678 | |||||||
Total Equity | 10,753 | 10,753 | |||||||
Net change in income tax assets and liabilities | (15) | ||||||||
Scenario, Previously Reported [Member] | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Income tax expense | 78 | 259 | |||||||
Income from Continuing Operations | 311 | 1,107 | |||||||
Net income | 162 | 992 | |||||||
Net Income Attributable to Xerox | 156 | 969 | |||||||
Net income from continuing operations | $ 305 | $ 1,084 | |||||||
Continuing Operations (dollars per share) | $ 0.26 | $ 0.92 | |||||||
Total Basic Earnings per Share (dollars per share) | 0.13 | 0.82 | |||||||
Continuing operations (dollars per share) | 0.26 | 0.90 | |||||||
Total Diluted Earnings per Share (dollars per share) | $ 0.13 | $ 0.81 | |||||||
Other long-term liabilities | $ 498 | $ 498 | |||||||
Total Liabilities | 16,600 | 16,600 | |||||||
Retained earnings | 9,491 | 9,491 | |||||||
Xerox shareholders' equity | 10,634 | 10,634 | |||||||
Total Equity | $ 10,709 | 10,709 | |||||||
Net change in income tax assets and liabilities | $ 29 | ||||||||
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. | ||||||||
[2] | Balance at December 31, 2014 was revised - Refer to Note 1 - Basis of Presentation for additional information regarding this revision. |
Recent Accounting Pronounceme40
Recent Accounting Pronouncements (Details) $ in Millions | Jun. 30, 2015USD ($) |
ASU 2015-03 Simplifying the Presentation of Debt Issuance Costs [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | $ 33 |
Segment Reporting, Segment Reve
Segment Reporting, Segment Revenue and Segment Profit (Loss) (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)service_offeringprimaryreportablesegment | Jun. 30, 2014USD ($) | |
Segment Reporting Information [Line Items] | ||||
Primary Reportable Segments, Number | primaryreportablesegment | 2 | |||
Segment Revenue | $ 4,590 | $ 4,941 | $ 9,059 | $ 9,712 |
Segment Profit (Loss) | 344 | 457 | 674 | 878 |
Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenue | 2,569 | 2,651 | 5,083 | 5,236 |
Segment Profit (Loss) | 192 | 226 | $ 381 | 448 |
Services [Member] | Outsourcing Offerings [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Outsourcing Service Offerings, Number | service_offering | 2 | |||
Document Technology [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenue | 1,880 | 2,126 | $ 3,710 | 4,170 |
Segment Profit (Loss) | 228 | 306 | 431 | 555 |
Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenue | 141 | 164 | 266 | 306 |
Segment Profit (Loss) | $ (76) | $ (75) | $ (138) | $ (125) |
Segment Reporting, Reconciliati
Segment Reporting, Reconciliation Of Operating Profit Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Segment Reporting [Abstract] | |||||
Segment Profit | $ 344 | $ 457 | $ 674 | $ 878 | |
Reconciling items: | |||||
Restructuring and asset impairment charges, and related costs(1) | [1] | (160) | (46) | (178) | (75) |
Restructuring charges of Fuji Xerox | (1) | 1 | (2) | (2) | |
Amortization of intangible assets | (79) | (78) | (156) | (155) | |
Equity in net income of unconsolidated affiliates | (29) | (33) | (63) | (75) | |
Other | (1) | 0 | 0 | 1 | |
Income before Income Taxes and Equity Income | 74 | 301 | 275 | 572 | |
Business transformation costs | $ 3 | $ 7 | $ 7 | $ 10 | |
[1] | ncludes business transformation costs of $3 and $7 for the three months ended June 30, 2015 and June 30, 2014, respectively, and $7 and $10 for the six months ended June 30, 2015 and June 30, 2014, respectively. Business transformation costs represent incremental costs incurred directly in support of our business transformation and restructuring initiatives such as compensation costs for overlapping staff, consulting costs and training costs. |
Acquisitions (Details)
Acquisitions (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2015USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)business | Jun. 30, 2014USD ($) | |
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 20 | $ 227 | $ 48 | $ 281 | |
Intellinex LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Acquisition, Effective Date of Acquisition | Jan. 31, 2015 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 28 | ||||
Services [Member] | |||||
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 14 | ||||
Number of Businesses Acquired | business | 1 | ||||
Technology Segment [Member] | |||||
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 6 | ||||
Number of Businesses Acquired | business | 1 |
Divestitures (Details)
Divestitures (Details) $ in Millions | Jun. 30, 2015USD ($)countryEmployees | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Proceeds from sale of businesses | $ 930 | $ 15 | $ 933 | $ 15 | |||||||
Revenues | 308 | 358 | 619 | 707 | |||||||
Income (loss) from operations (1), (2) | [1],[2] | 43 | 23 | 104 | 43 | ||||||
Loss on disposal | (68) | (2) | (72) | 0 | |||||||
Net (loss) income before income taxes | (25) | 21 | 32 | 43 | |||||||
Income tax expense | (70) | (10) | (93) | (17) | |||||||
(Loss) income from discontinued operations, net of tax | (95) | 11 | (61) | 26 | |||||||
Disposal Group, Including Discontinued Operation, Assets [Abstract] | |||||||||||
Total Assets of Discontinued Operations | $ 0 | 0 | $ 1,260 | [3] | 0 | ||||||
ITO [Member] | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Proceeds from sale of businesses | 940 | ||||||||||
Proceeds from Divestiture of Businesses, Net of Cash Divested | 930 | ||||||||||
Discontinued Operations - Liabilities assumed by Acquirer | 85 | ||||||||||
Proceeds from Divestiture of Business, net of tax | $ 850 | ||||||||||
Employees Transferred in Business Sale or Divestiture | Employees | 9,600 | ||||||||||
Number of Countries, a Business or Segment has operations in | country | 42 | ||||||||||
Discontinued Operations, Additional Tax Expense | 54 | ||||||||||
Revenues | 308 | 341 | 619 | 669 | |||||||
Income (loss) from operations (1), (2) | [1] | 43 | [2] | 23 | [2] | 104 | [2] | 44 | |||
Loss on disposal | (68) | (181) | 0 | (72) | 0 | ||||||
Net (loss) income before income taxes | (25) | 23 | 32 | 44 | |||||||
Income tax expense | (70) | (9) | (93) | (16) | |||||||
(Loss) income from discontinued operations, net of tax | (95) | 14 | (61) | 28 | |||||||
Disposal Group, Including Discontinued Operation, Depreciation and Amortization | 41 | 8 | 80 | 16 | |||||||
Disposal group, amortization of acquired intangible assets | 7 | 14 | |||||||||
Disposal Group, Including Discontinued Operation, Assets [Abstract] | |||||||||||
Accounts receivable, net | 213 | ||||||||||
Other current assets | 146 | ||||||||||
Land, buildings and equipment, net | 220 | ||||||||||
Intangible assets, net | 197 | ||||||||||
Goodwill | 337 | ||||||||||
Other long-term assets | 147 | ||||||||||
Total Assets of Discontinued Operations | 1,260 | ||||||||||
Disposal Group, Including Discontinued Operation, Liabilities [Abstract] | |||||||||||
Current portion of long-term debt | 31 | ||||||||||
Accounts payable | 32 | ||||||||||
Accrued pension and benefit costs | 9 | ||||||||||
Unearned income | 64 | ||||||||||
Other current liabilities | 112 | ||||||||||
Long-term debt | 44 | ||||||||||
Pension and other benefit liabilities | 25 | ||||||||||
Other long-term liabilities | 54 | ||||||||||
Total Liabilities of Discontinued Operations | $ 371 | ||||||||||
Other Segment [Member] | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Revenues | 0 | 17 | 0 | 38 | |||||||
Income (loss) from operations (1), (2) | [1],[2] | 0 | 0 | 0 | (1) | ||||||
Loss on disposal | 0 | (2) | 0 | 0 | |||||||
Net (loss) income before income taxes | 0 | (2) | 0 | (1) | |||||||
Income tax expense | 0 | (1) | 0 | (1) | |||||||
(Loss) income from discontinued operations, net of tax | $ 0 | $ (3) | $ 0 | $ (2) | |||||||
[1] | (1)ITO Income from operations excludes depreciation and amortization expenses of approximately $41 and $80 (including $7 and $14 for intangible amortization) for the three and six months ended June 30, 2015, respectively, since the business was held for sale. | ||||||||||
[2] | (2)ITO Income from operations includes intangible amortization and other expenses of approximately $8 and $16 for the three and six months ended June 30, 2014, respectively. | ||||||||||
[3] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. |
Accounts Receivable, Net (Detai
Accounts Receivable, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | ||
Receivables [Abstract] | ||||||
Amounts billed or billable | $ 2,485 | $ 2,485 | $ 2,421 | |||
Unbilled amounts | 319 | 319 | 318 | |||
Allowance for doubtful accounts | (82) | (82) | (87) | |||
Accounts Receivable, Net | 2,722 | 2,722 | 2,652 | |||
Billable contracts receivable to be invoiced in the subsequent month | 926 | 926 | 945 | |||
Accounts Receivable Sales Arrangements [Abstract] | ||||||
Deferred proceeds receivables from sales of accounts receivables | 59 | 59 | 73 | |||
Remaining account receivable sold and derecognized | 539 | 539 | $ 580 | |||
Accounts Receivable [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Accounts receivable sales | 586 | $ 726 | 1,188 | $ 1,548 | ||
Deferred proceeds | 57 | 96 | 119 | 220 | ||
Loss on sales of accounts receivable | 3 | 4 | 6 | 8 | ||
Estimated decrease to operating cash flows | [1] | $ (27) | $ (31) | $ (10) | $ (20) | |
[1] | Represents the difference between current and prior period receivable sales adjusted for the effects of: (i)Â the deferred proceeds, (ii)Â collections prior to the end of the quarter and, (iii)Â currency. |
Finance Receivables, Net, Sale
Finance Receivables, Net, Sale of Finance Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Net carrying value (NCV) sold | $ 676 | $ 682 | ||||||
Allowance included in NCV | 17 | 18 | ||||||
Cash proceeds received | 635 | 630 | ||||||
Beneficial interests received | 86 | 101 | ||||||
Net fees and expenses | 5 | 5 | ||||||
Finance receivables sold and derecognized principal value | $ 376 | $ 376 | $ 549 | |||||
Finance receivables sold and derecognized sales value | 404 | 404 | 596 | |||||
Beneficial Interest, Interest in Other Current Assets | 56 | 56 | 77 | |||||
Beneficial interest from sale of finance receivables | 46 | $ 46 | $ 64 | |||||
Finance Receivable Beneficial Interest Weighted Average Life | 2 years | |||||||
Collections on beneficial interest | 12 | $ 21 | $ 27 | $ 42 | ||||
Financing Receivable [Member] | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Pre-tax gain on sales | $ 40 | $ 44 | ||||||
Impact from prior sales of finance receivables | [1] | (89) | (137) | (194) | (286) | |||
Collections on beneficial interest | 15 | 25 | 33 | 51 | ||||
Estimated Decrease to Operating Cash Flows | $ (74) | $ (112) | $ (161) | $ (235) | ||||
[1] | Represents cash that would have been collected had we not sold finance receivables. |
Finance Receivables, Net (Detai
Finance Receivables, Net (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | ||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning Balance | $ 131 | $ 131 | $ 158 | $ 154 | |
Provision | 10 | 11 | 15 | 15 | |
Charge-offs | (10) | (5) | (11) | (12) | |
Recoveries and other | [1] | 3 | (6) | 2 | 1 |
Ending Balance | 134 | 131 | 164 | 158 | |
Financing Receivable, Collectively Evaluated for Impairment | [2] | 4,156 | 4,614 | ||
Allowance for credit losses not included in the impairment evaluation | 134 | 164 | |||
United States | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning Balance | 43 | 41 | 48 | 45 | |
Provision | 1 | 2 | 1 | 3 | |
Charge-offs | (1) | 0 | 0 | (1) | |
Recoveries and other | [1] | (1) | 0 | 0 | 1 |
Ending Balance | 42 | 43 | 49 | 48 | |
Financing Receivable, Collectively Evaluated for Impairment | [2] | 1,710 | 1,684 | ||
Canada | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning Balance | 18 | 20 | 20 | 22 | |
Provision | 1 | 1 | 2 | 2 | |
Charge-offs | (2) | (3) | (4) | (4) | |
Recoveries and other | [1] | 1 | 0 | 2 | 0 |
Ending Balance | 18 | 18 | 20 | 20 | |
Financing Receivable, Collectively Evaluated for Impairment | [2] | 397 | 421 | ||
Europe | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning Balance | 56 | 58 | 83 | 81 | |
Provision | 6 | 5 | 11 | 7 | |
Charge-offs | (5) | (1) | (8) | (5) | |
Recoveries and other | [1] | 3 | (6) | 0 | 0 |
Ending Balance | 60 | 56 | 86 | 83 | |
Financing Receivable, Collectively Evaluated for Impairment | [2] | 1,619 | 2,170 | ||
Other | |||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||
Beginning Balance | [3] | 14 | 12 | 7 | 6 |
Provision | [3] | 2 | 3 | 1 | 3 |
Charge-offs | [3] | (2) | (1) | 1 | (2) |
Recoveries and other | [1],[3] | 0 | 0 | 0 | 0 |
Ending Balance | [3] | 14 | $ 14 | 9 | $ 7 |
Financing Receivable, Collectively Evaluated for Impairment | [2],[3] | $ 430 | $ 339 | ||
[1] | Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations. | ||||
[2] | Total Finance receivables exclude the allowance for credit losses of $134 and $164 at June 30, 2015 and 2014, respectively. | ||||
[3] | Includes developing market countries and smaller units. |
Finance Receivables, Net, Credi
Finance Receivables, Net, Credit Quality Indicators (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2015 | Dec. 31, 2014 | ||
Financing Receivable, Recorded Investment [Line Items] | |||
Loss Rates Of Customers With Investment Grade Credit Quality | 1.00% | ||
Loss Rates Of Customers With Non Investment Grade Credit Quality Low Range | 2.00% | ||
Loss Rates Of Customers With Non Investment Grade Credit Quality High Range | 4.00% | ||
Loss Rates Of Customers With Substandard Doubtful Credit Quality | 10.00% | ||
Financing Receivable, Net | $ 4,156 | $ 4,385 | |
United States | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 1,710 | 1,728 | |
United States | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 427 | 409 | |
United States | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 573 | 605 | |
United States | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 314 | 317 | |
United States | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 148 | 151 | |
United States | Healthcare | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 126 | 124 | |
United States | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 122 | 122 | |
Canada | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 397 | 424 | |
Canada | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 100 | 97 | |
Canada | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 77 | 86 | |
Canada | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 121 | 143 | |
Canada | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 41 | 41 | |
Canada | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 58 | 57 | |
Europe | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 1,619 | 1,835 | |
France | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 541 | 616 | |
U.K./Ireland | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 345 | 362 | |
Central | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [1],[2] | 461 | 538 |
Southern | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [3] | 206 | 244 |
Nordics | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [4] | 66 | 75 |
Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 430 | 398 | |
Investment Grade | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 2,270 | 2,427 | |
Investment Grade | United States | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 1,130 | 1,163 | |
Investment Grade | United States | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 191 | 195 | |
Investment Grade | United States | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 556 | 589 | |
Investment Grade | United States | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 150 | 148 | |
Investment Grade | United States | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 91 | 92 | |
Investment Grade | United States | Healthcare | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 87 | 84 | |
Investment Grade | United States | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 55 | 55 | |
Investment Grade | Canada | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 232 | 246 | |
Investment Grade | Canada | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 55 | 54 | |
Investment Grade | Canada | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 67 | 76 | |
Investment Grade | Canada | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 51 | 58 | |
Investment Grade | Canada | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 24 | 24 | |
Investment Grade | Canada | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 35 | 34 | |
Investment Grade | Europe | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 741 | 823 | |
Investment Grade | France | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 224 | 253 | |
Investment Grade | U.K./Ireland | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 246 | 255 | |
Investment Grade | Central | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [2] | 217 | 230 |
Investment Grade | Southern | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [3] | 31 | 60 |
Investment Grade | Nordics | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [4] | 23 | 25 |
Investment Grade | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 167 | 195 | |
Non-investment Grade | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 1,405 | 1,449 | |
Non-investment Grade | United States | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 377 | 356 | |
Non-investment Grade | United States | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 177 | 159 | |
Non-investment Grade | United States | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 13 | 13 | |
Non-investment Grade | United States | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 81 | 79 | |
Non-investment Grade | United States | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 41 | 41 | |
Non-investment Grade | United States | Healthcare | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 25 | 26 | |
Non-investment Grade | United States | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 40 | 38 | |
Non-investment Grade | Canada | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 116 | 120 | |
Non-investment Grade | Canada | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 34 | 31 | |
Non-investment Grade | Canada | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 8 | 8 | |
Non-investment Grade | Canada | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 41 | 49 | |
Non-investment Grade | Canada | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 13 | 13 | |
Non-investment Grade | Canada | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 20 | 19 | |
Non-investment Grade | Europe | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 707 | 810 | |
Non-investment Grade | France | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 208 | 234 | |
Non-investment Grade | U.K./Ireland | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 95 | 101 | |
Non-investment Grade | Central | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [2] | 216 | 278 |
Non-investment Grade | Southern | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [3] | 145 | 148 |
Non-investment Grade | Nordics | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [4] | 43 | 49 |
Non-investment Grade | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 205 | 163 | |
Substandard | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 481 | 509 | |
Substandard | United States | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 203 | 209 | |
Substandard | United States | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 59 | 55 | |
Substandard | United States | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 4 | 3 | |
Substandard | United States | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 83 | 90 | |
Substandard | United States | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 16 | 18 | |
Substandard | United States | Healthcare | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 14 | 14 | |
Substandard | United States | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 27 | 29 | |
Substandard | Canada | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 49 | 58 | |
Substandard | Canada | Finance and other services | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 11 | 12 | |
Substandard | Canada | Government and education | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 2 | 2 | |
Substandard | Canada | Graphic arts | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 29 | 36 | |
Substandard | Canada | Industrial | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 4 | 4 | |
Substandard | Canada | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 3 | 4 | |
Substandard | Europe | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 171 | 202 | |
Substandard | France | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 109 | 129 | |
Substandard | U.K./Ireland | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | 4 | 6 | |
Substandard | Central | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [2] | 28 | 30 |
Substandard | Southern | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [3] | 30 | 36 |
Substandard | Nordics | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | [4] | 0 | 1 |
Substandard | Other | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Financing Receivable, Net | $ 58 | $ 40 | |
[1] | Switzerland, Germany, Austria, Belgium and Holland. | ||
[2] | Switzerland, Germany, Austria, Belgium and Holland. | ||
[3] | Italy, Greece, Spain and Portugal. | ||
[4] | Sweden, Norway, Denmark and Finland. |
Finance Receivables, Net, Aging
Finance Receivables, Net, Aging (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | $ 2,485 | $ 2,421 | |
Total Finance Receivables | 4,156 | 4,385 | |
Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 122 | 117 | |
Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 4,034 | 4,268 | |
United States | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1,710 | 1,728 | |
United States | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 64 | 59 | |
United States | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 1,646 | 1,669 | |
United States | Finance and other services | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 427 | 409 | |
United States | Finance and other services | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 11 | 10 | |
United States | Finance and other services | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 416 | 399 | |
United States | Government and education | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 573 | 605 | |
United States | Government and education | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 22 | 21 | |
United States | Government and education | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 551 | 584 | |
United States | Graphic arts | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 314 | 317 | |
United States | Graphic arts | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 16 | 14 | |
United States | Graphic arts | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 298 | 303 | |
United States | Industrial | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 148 | 151 | |
United States | Industrial | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 6 | 6 | |
United States | Industrial | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 142 | 145 | |
United States | Healthcare | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 126 | 124 | |
United States | Healthcare | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 5 | 4 | |
United States | Healthcare | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 121 | 120 | |
United States | Other | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 122 | 122 | |
United States | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 4 | 4 | |
United States | Other | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 118 | 118 | |
Canada | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 397 | 424 | |
Canada | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 12 | 12 | |
Canada | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 385 | 412 | |
Canada | Finance and other services | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 100 | 97 | |
Canada | Government and education | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 77 | 86 | |
Canada | Graphic arts | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 121 | 143 | |
Canada | Industrial | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 41 | 41 | |
Canada | Other | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 58 | 57 | |
Europe | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1,619 | 1,835 | |
Europe | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 31 | 32 | |
Europe | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 1,588 | 1,803 | |
France | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 541 | 616 | |
France | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 1 | 3 | |
France | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 540 | 613 | |
U.K./Ireland | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 345 | 362 | |
U.K./Ireland | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 3 | 1 | |
U.K./Ireland | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 342 | 361 | |
Central | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [1],[2] | 461 | 538 |
Central | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | [1] | 7 | 5 |
Central | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | [1] | 454 | 533 |
Southern | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [3] | 206 | 244 |
Southern | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | [3] | 19 | 22 |
Southern | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | [3] | 187 | 222 |
Nordics | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [4] | 66 | 75 |
Nordics | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | [4] | 1 | 1 |
Nordics | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | [4] | 65 | 74 |
Other | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 430 | 398 | |
Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Billed portion of finance receivables, net | 15 | 14 | |
Other | Unbilled Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Unbilled | 415 | 384 | |
Current [Member] | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 89 | 83 | |
Current [Member] | United States | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 48 | 43 | |
Current [Member] | United States | Finance and other services | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 7 | 7 | |
Current [Member] | United States | Government and education | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 16 | 14 | |
Current [Member] | United States | Graphic arts | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 14 | 12 | |
Current [Member] | United States | Industrial | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 4 | 4 | |
Current [Member] | United States | Healthcare | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 3 | 3 | |
Current [Member] | United States | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 4 | 3 | |
Current [Member] | Canada | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 9 | 9 | |
Current [Member] | Europe | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 19 | 18 | |
Current [Member] | France | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 0 | |
Current [Member] | U.K./Ireland | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 2 | 1 | |
Current [Member] | Central | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [1] | 4 | 2 |
Current [Member] | Southern | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [3] | 12 | 14 |
Current [Member] | Nordics | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [4] | 1 | 1 |
Current [Member] | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 13 | 13 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 19 | 20 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 8 | 10 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Finance and other services | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 2 | 2 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Government and education | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 3 | 4 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Graphic arts | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Industrial | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Healthcare | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | United States | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 1 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Canada | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 2 | 2 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Europe | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 7 | 7 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | France | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 1 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | U.K./Ireland | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 0 | |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Central | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [1] | 2 | 2 |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Southern | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [3] | 4 | 4 |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Nordics | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [4] | 0 | 0 |
Finance Receivables, Recorded Investment, 1 to 60 Days Past Due [Member] | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 2 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 14 | 14 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 8 | 6 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Finance and other services | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 2 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Government and education | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 3 | 3 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Graphic arts | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Industrial | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Healthcare | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 0 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | United States | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 0 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Canada | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Europe | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 5 | 7 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | France | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 2 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | U.K./Ireland | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 0 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Central | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [1] | 1 | 1 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Southern | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [3] | 3 | 4 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Nordics | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [4] | 0 | 0 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due [Member] | Other | Billed Revenues [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 0 | 0 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 123 | 151 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 61 | 64 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Finance and other services | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 12 | 13 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Government and education | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 25 | 25 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Graphic arts | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 8 | 6 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Industrial | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 7 | 9 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Healthcare | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 5 | 5 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | United States | Other | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 4 | 6 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Canada | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 11 | 17 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Europe | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 51 | 70 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | France | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 31 | 35 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | U.K./Ireland | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | 1 | 1 | |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Central | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [1] | 6 | 15 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Southern | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [3] | 10 | 17 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Nordics | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | [4] | 3 | 2 |
Finance Receivables, Recorded Investment, Greater than 60 Days Past Due and Still Accruing [Member] | Other | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Total Finance Receivables | $ 0 | $ 0 | |
[1] | Switzerland, Germany, Austria, Belgium and Holland. | ||
[2] | Switzerland, Germany, Austria, Belgium and Holland. | ||
[3] | Italy, Greece, Spain and Portugal. | ||
[4] | Sweden, Norway, Denmark and Finland. |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 | |
Inventories, net [Abstract] | |||
Finished goods | $ 895 | $ 778 | |
Work-in-process | 66 | 58 | |
Raw materials | 111 | 98 | |
Total Inventories | $ 1,072 | $ 934 | [1] |
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. |
Investment in Affiliates, at 51
Investment in Affiliates, at Equity (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | ||
Schedule of Equity Method Investments [Line Items] | |||||
Total Equity in Net Income of Unconsolidated Affiliates | $ 29 | $ 33 | $ 63 | $ 75 | |
Fuji Xerox | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Total Equity in Net Income of Unconsolidated Affiliates | $ 25 | 31 | $ 56 | 70 | |
Ownership percentage | 25.00% | 25.00% | |||
Summary of Operations: | |||||
Revenues | $ 2,389 | 2,707 | $ 5,120 | 5,728 | |
Costs and expenses | 2,211 | 2,510 | 4,731 | 5,311 | |
Income before income taxes | 178 | 197 | 389 | 417 | |
Income tax expense | 63 | 67 | 129 | 125 | |
Net Income | 115 | 130 | 260 | 292 | |
Less: Net income – noncontrolling interests | 2 | 1 | 4 | 2 | |
Net Income – Fuji Xerox | $ 113 | $ 129 | $ 256 | $ 290 | |
Weighted Average Exchange Rate(1) | [1] | 121.39 | 102.13 | 120.27 | 102.41 |
Other investments | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Total Equity in Net Income of Unconsolidated Affiliates | $ 4 | $ 2 | $ 7 | $ 5 | |
[1] | Represents Yen/U.S. Dollar exchange rate used to translate. |
Restructuring Programs (Details
Restructuring Programs (Details) Employees in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)Employees | Jun. 30, 2014USD ($) | |||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Number of Positions Eliminated (approximately) | Employees | 1 | |||||
Restructuring Reserve [Roll Forward] | ||||||
Balance at beginning of period | $ 97 | |||||
Restructuring Charge, Including Asset Impairment Relatedto Discontinued Operation | 187 | |||||
Reversals | (16) | |||||
Net Current Period Charges | $ 157 | $ 39 | 171 | [1] | $ 65 | |
Charges against reserve and currency | (175) | (40) | (212) | (81) | ||
Balance at end of period | 56 | 56 | ||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||
Charges against reserve | (175) | (40) | (212) | (81) | ||
Asset impairments | 146 | 3 | 146 | 7 | ||
Effects of foreign currency and other non-cash items | (1) | 1 | 5 | 2 | ||
Restructuring Cash Payments | (30) | (36) | (61) | (72) | ||
Net current period restructuring charges, discontinued operations | (1) | |||||
Services [Member] | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Net Current Period Charges | [2] | 149 | 5 | 154 | 14 | |
Document Technology | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Net Current Period Charges | 8 | 26 | 17 | 42 | ||
Other | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Net Current Period Charges | 0 | $ 8 | 0 | $ 9 | ||
Severance and Related Costs [Member] | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Balance at beginning of period | 93 | |||||
Restructuring Charge, Including Asset Impairment Relatedto Discontinued Operation | 38 | |||||
Reversals | (13) | |||||
Net Current Period Charges | [1] | 25 | ||||
Charges against reserve and currency | (65) | |||||
Balance at end of period | 53 | 53 | ||||
Restructuring Charges | 38 | |||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||
Charges against reserve | (65) | |||||
Lease Cancellation and Other Costs [Member] | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Balance at beginning of period | 4 | |||||
Restructuring Charge, Including Asset Impairment Relatedto Discontinued Operation | 3 | |||||
Reversals | (3) | |||||
Net Current Period Charges | [1] | 0 | ||||
Charges against reserve and currency | (1) | |||||
Balance at end of period | 3 | 3 | ||||
Restructuring Charges | 3 | |||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||
Charges against reserve | (1) | |||||
Asset Impairments [Member] | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Balance at beginning of period | [3] | 0 | ||||
Restructuring Charge, Including Asset Impairment Relatedto Discontinued Operation | [3] | 146 | ||||
Reversals | [3] | 0 | ||||
Net Current Period Charges | [1],[3] | 146 | ||||
Charges against reserve and currency | [3] | (146) | ||||
Balance at end of period | [3] | $ 0 | 0 | |||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||
Charges against reserve | [3] | $ (146) | ||||
ITO [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Disposal Date | Jun. 30, 2015 | |||||
[1] | Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown. | |||||
[2] | The three months ended June 30, 2014 excludes $(1) related to the ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. | |||||
[3] | Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision. |
Debt, Debt Issuances (Details)
Debt, Debt Issuances (Details) - Mar. 31, 2015 - USD ($) | Total |
Senior Notes due 2020 2.75% [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | $ 400,000,000 |
Debt Instrument, Stated Interest Rate | 2.75% |
Debt Instrument, Maturity Date | May 15, 2020 |
Debt percentage of par issued | 0.99879 |
Senior Notes due 2035 4.8% [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | $ 250,000,000 |
Debt Instrument, Stated Interest Rate | 4.80% |
Debt Instrument, Maturity Date | May 15, 2035 |
Debt percentage of par issued | 0.99428 |
Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Proceeds from Issuance of Debt | $ 648,000,000 |
Debt Issuance Cost | $ 6,000,000 |
Debt, Interest Income and Expen
Debt, Interest Income and Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Debt Disclosure [Abstract] | |||||
Interest expense(1),(2) | [1],[2] | $ 88 | $ 96 | $ 177 | $ 195 |
Interest income(3) | [3] | $ 89 | $ 101 | 181 | 203 |
ITO [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Disposal Group, Including Discontinued Operation, Interest Expense | $ 2 | $ 1 | |||
[1] | (2)The six months ended June 30, 2015 and 2014 exclude $2 and $1, respectively, of interest on capital lease obligations related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. These obligations were assumed by the purchaser of the ITO business. Refer to Note 5 - Divestitures for additional information regarding this sale. | ||||
[2] | Includes Equipment financing interest as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income. | ||||
[3] | Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income. |
Debt, Net Payments and Proceeds
Debt, Net Payments and Proceeds on Other Debt (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Debt Disclosure [Abstract] | |||||
Net proceeds on short-term debt | $ 514 | $ 45 | |||
Proceeds from issuance of long-term debt | 673 | 741 | |||
Payments on long-term debt(1) | [1] | (1,284) | (1,081) | ||
Net payments on debt | $ 53 | $ (299) | $ (97) | $ (295) | |
[1] | Includes current maturities. |
Financial Instruments, Fair Val
Financial Instruments, Fair Value Hedges (Details) - Jun. 30, 2015 - Senior Notes Due 2021 [Member] - USD ($) $ in Millions | Total |
Derivative [Line Items] | |
Notional Amount | $ 300 |
Net Fair Value | $ 5 |
Weighted Average Interest Rate Paid | 2.44% |
Interest Rate Received | 4.50% |
Financial Instruments, Foreign
Financial Instruments, Foreign Exchange Risk Management (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 | |
Foreign Exchange Contracts [Line Items] | |||
Average Maturity of Foreign Exchange Hedging Contracts - within Three Months | 64.00% | ||
Average Maturity of Foreign Exchange Hedging Contracts - within Three and Six Months | 14.00% | ||
Average Maturity of Foreign Exchange Hedging Contracts - within Six and Twelve Months | 21.00% | ||
Average Maturity of Foreign Exchange Hedging Contracts - greater than twelve months | 1.00% | ||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | $ 3,631 | ||
Foreign Currency Cash Flow Hedges [Abstract] | |||
Derivative Assets (Liabilities), at Fair Value, Net | (15) | $ (31) | |
Euro/U.K. Pound Sterling | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 902 | ||
U.S. Dollar/U.K. Pound Sterling | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 591 | ||
Japanese Yen/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 464 | ||
Japanese Yen/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 302 | ||
U.S. Dollar/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 280 | ||
Canadian Dollar/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 278 | ||
U.K. Pound Sterling/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 212 | ||
Swiss Franc/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 109 | ||
Euro/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 75 | ||
Euro/Canadian Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 65 | ||
Indian Rupee/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 56 | ||
Philippine Peso/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 51 | ||
Mexican Peso/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 40 | ||
Mexican Peso/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 30 | ||
U.S. Dollar/Canadian Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 23 | ||
Swedish Krone/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 20 | ||
Euro/Danish Krone | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 20 | ||
All Other | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Gross Notional Value | 113 | ||
Foreign Exchange Contract [Member] | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (20) | |
Foreign Exchange Contract [Member] | Euro/U.K. Pound Sterling | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (3) | |
Foreign Exchange Contract [Member] | U.S. Dollar/U.K. Pound Sterling | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (5) | |
Foreign Exchange Contract [Member] | Japanese Yen/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (15) | |
Foreign Exchange Contract [Member] | Japanese Yen/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (2) | |
Foreign Exchange Contract [Member] | U.S. Dollar/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 2 | |
Foreign Exchange Contract [Member] | Canadian Dollar/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 5 | |
Foreign Exchange Contract [Member] | U.K. Pound Sterling/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 1 | |
Foreign Exchange Contract [Member] | Swiss Franc/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | Euro/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | Euro/Canadian Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 1 | |
Foreign Exchange Contract [Member] | Indian Rupee/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | Philippine Peso/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (1) | |
Foreign Exchange Contract [Member] | Mexican Peso/U.S. Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (2) | |
Foreign Exchange Contract [Member] | Mexican Peso/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | (1) | |
Foreign Exchange Contract [Member] | U.S. Dollar/Canadian Dollar | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | Swedish Krone/Euro | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | Euro/Danish Krone | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Foreign Exchange Contract [Member] | All Other | |||
Summary of Foreign Exchange Hedging Positions [Abstract] | |||
Fair Value Asset (Liability) | [1] | 0 | |
Designated as Hedging Instrument [Member] | |||
Foreign Currency Cash Flow Hedges [Abstract] | |||
Derivative Assets (Liabilities), at Fair Value, Net | $ (18) | $ (30) | |
[1] | Represents the net receivable (payable) amount included in the Condensed Consolidated Balance Sheet at June 30, 2015. |
Financial Instruments, Summary
Financial Instruments, Summary of Derivative Instruments Fair Value (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Liability | $ (15) | $ (31) |
Other current assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 23 | 27 |
Liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (38) | (58) |
Derivatives Designated as Hedging Instruments [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Liability | (18) | (30) |
Derivatives Designated as Hedging Instruments [Member] | Liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Liability | (13) | (25) |
Derivatives Designated as Hedging Instruments [Member] | Foreign exchange contracts - forwards [Member] | Other current assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 3 | 7 |
Derivatives Designated as Hedging Instruments [Member] | Foreign exchange contracts - forwards [Member] | Other current liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (20) | (39) |
Derivatives Designated as Hedging Instruments [Member] | Foreign currency options [Member] | Other current assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 2 | 2 |
Derivatives Designated as Hedging Instruments [Member] | Foreign currency options [Member] | Other current liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (3) | 0 |
Derivatives Designated as Hedging Instruments [Member] | Interest rate swap [Member] | Other long-term assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 5 | 5 |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Liability | (2) | (6) |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | Other current assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 13 | 13 |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | Other current liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | $ (15) | $ (19) |
Financial Instruments, Summar59
Financial Instruments, Summary of Derivative Instruments Gain (Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Net losses recorded in AOCL expected to be reclassified to net income in the future | $ 12 | |||
Foreign Currency Transaction Gain (Loss), before Tax | $ 5 | $ 1 | (1) | $ 0 |
Foreign Exchange Forward [Member] | Foreign Currency Gain (Loss) [Member] | Derivatives Not Designated as Hedging Instruments [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (50) | 0 | (35) | 0 |
Fair Value Hedging [Member] | Interest Rate Contract [Member] | Interest Expense [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative (loss) gain recognized in interest expense | (4) | 5 | 0 | 2 |
Hedged item gain (loss) recognized in interest expense | 4 | (5) | 0 | (2) |
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative (loss) gain recognized in OCI (effective portion) | (24) | 11 | 7 | 29 |
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | Cost of Sales [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative loss reclassified from AOCI to income - Cost of sales (effective portion) | $ 0 | $ (8) | $ (10) | $ (29) |
Fair Value of Financial Asset60
Fair Value of Financial Assets and Liabilities, Recurring (Details) - Fair Value, Measurements, Recurring [Member] - Significant Other Observable Inputs (Level 2) [Member] - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Assets: | ||
Interest rate swaps | $ 5 | $ 5 |
Deferred compensation investments in cash surrender life insurance | 97 | 94 |
Deferred compensation investments in mutual funds | 34 | 32 |
Total | 154 | 153 |
Liabilities: | ||
Deferred compensation plan liabilities | 145 | 135 |
Total | 183 | 193 |
Foreign Exchange Forward [Member] | ||
Assets: | ||
Foreign exchange contracts | 16 | 20 |
Liabilities: | ||
Foreign exchange contracts - forwards | 35 | 58 |
Options Held [Member] | ||
Assets: | ||
Foreign exchange contracts | 2 | 2 |
Foreign Exchange Option [Member] | ||
Liabilities: | ||
Foreign exchange contracts - forwards | $ 3 | $ 0 |
Fair Value of Financial Asset61
Fair Value of Financial Assets and Liabilities, Nonrecurring (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 1,641 | $ 1,411 |
Accounts receivable, net | 2,722 | 2,652 |
Short-term debt | 1,648 | 1,427 |
Long-term debt | 5,998 | 6,314 |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 1,641 | 1,411 |
Accounts receivable, net | 2,722 | 2,652 |
Short-term debt | 1,664 | 1,417 |
Long-term debt | $ 6,262 | $ 6,719 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | ||
Components of Net Periodic Benefit Costs: | ||||||
Recognized curtailment gain | $ (22) | |||||
Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: | ||||||
Net actuarial (gain) loss(1) | 200 | $ (100) | $ 112 | $ (297) | ||
Amortization of prior service credit | [1] | (32) | (11) | (40) | (23) | |
Amortization of net actuarial loss | [1] | 46 | 33 | 99 | 61 | |
Pension Benefits | ||||||
Contributions [Abstract] | ||||||
Defined Benefit Plan, Contributions by Employer | 98 | $ 284 | ||||
Anticipated additional contributions to the defined benefit and post retirement plans in current fiscal year | 242 | |||||
Anticipated total cash contributions to defined benefit and post retirement plans in the current year | 340 | 340 | ||||
Retiree Health | ||||||
Components of Net Periodic Benefit Costs: | ||||||
Service cost | 2 | 2 | 4 | 4 | ||
Interest cost | 8 | 9 | 17 | 18 | ||
Expected return on plan assets | 0 | 0 | 0 | 0 | ||
Recognized net actuarial loss | 1 | 0 | 1 | 0 | ||
Amortization of prior service credit | (8) | (10) | (15) | (21) | ||
Recognized settlement loss | 0 | 0 | 0 | 0 | ||
Recognized curtailment gain | (22) | 0 | (22) | 0 | ||
Defined Benefit Plans | (19) | 1 | (15) | 1 | ||
Defined contribution plans (3) | [2] | 0 | 0 | 0 | 0 | |
Net Periodic Benefit Cost | (19) | 1 | (15) | 1 | ||
Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: | ||||||
Net actuarial (gain) loss(1) | [3] | (58) | 0 | (58) | 0 | |
Amortization of prior service credit | 8 | 10 | 15 | 21 | ||
Amortization of net actuarial loss | (1) | 0 | (1) | 0 | ||
Curtailment gain - recognition of net prior service credit | 22 | 0 | 22 | 0 | ||
Total Recognized in Other Comprehensive Loss(2) | [4] | (29) | 10 | (22) | 21 | |
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss | (48) | 11 | (37) | 22 | ||
Contributions [Abstract] | ||||||
Defined Benefit Plan, Contributions by Employer | 29 | 70 | ||||
Anticipated additional contributions to the defined benefit and post retirement plans in current fiscal year | 42 | |||||
Anticipated total cash contributions to defined benefit and post retirement plans in the current year | 71 | 71 | ||||
ITO [Member] | ||||||
Components of Net Periodic Benefit Costs: | ||||||
Defined contribution plans (3) | [2] | 4 | 4 | |||
United States | Pension Benefits | ||||||
Components of Net Periodic Benefit Costs: | ||||||
Service cost | 1 | 3 | 2 | 5 | ||
Interest cost | 38 | 38 | 76 | 78 | ||
Expected return on plan assets | (38) | (42) | (76) | (80) | ||
Recognized net actuarial loss | 6 | 6 | 13 | 8 | ||
Amortization of prior service credit | 0 | (1) | (1) | (1) | ||
Recognized settlement loss | 18 | 13 | 45 | 25 | ||
Recognized curtailment gain | 0 | 0 | 0 | 0 | ||
Defined Benefit Plans | 25 | 17 | 59 | 35 | ||
Defined contribution plans (3) | [2] | 15 | 15 | 31 | 30 | |
Net Periodic Benefit Cost | 40 | 32 | 90 | 65 | ||
Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: | ||||||
Net actuarial (gain) loss(1) | [3] | (140) | 100 | (52) | 297 | |
Amortization of prior service credit | 0 | 1 | 1 | 1 | ||
Amortization of net actuarial loss | (24) | (19) | (58) | (33) | ||
Curtailment gain - recognition of net prior service credit | 0 | 0 | 0 | 0 | ||
Total Recognized in Other Comprehensive Loss(2) | [4] | (164) | 82 | (109) | 265 | |
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss | (124) | 114 | (19) | 330 | ||
Contributions [Abstract] | ||||||
Defined Benefit Plan, Contributions by Employer | 13 | 124 | ||||
Anticipated additional contributions to the defined benefit and post retirement plans in current fiscal year | 167 | |||||
Anticipated total cash contributions to defined benefit and post retirement plans in the current year | 180 | 180 | ||||
Non-U.S. Plans | Pension Benefits | ||||||
Components of Net Periodic Benefit Costs: | ||||||
Service cost | 9 | 8 | 17 | 17 | ||
Interest cost | 53 | 67 | 106 | 136 | ||
Expected return on plan assets | (74) | (85) | (147) | (172) | ||
Recognized net actuarial loss | 21 | 14 | 40 | 28 | ||
Amortization of prior service credit | (2) | 0 | (2) | (1) | ||
Recognized settlement loss | 0 | 0 | 0 | 0 | ||
Recognized curtailment gain | 0 | 0 | 0 | 0 | ||
Defined Benefit Plans | 7 | 4 | 14 | 8 | ||
Defined contribution plans (3) | [2] | 11 | 8 | 20 | 18 | |
Net Periodic Benefit Cost | 18 | 12 | 34 | 26 | ||
Other changes in plan assets and benefit obligations recognized in Other Comprehensive Loss: | ||||||
Net actuarial (gain) loss(1) | [3] | (2) | 0 | (2) | 0 | |
Amortization of prior service credit | 2 | 0 | 2 | 1 | ||
Amortization of net actuarial loss | (21) | (14) | (40) | (28) | ||
Curtailment gain - recognition of net prior service credit | 0 | 0 | 0 | 0 | ||
Total Recognized in Other Comprehensive Loss(2) | [4] | (21) | (14) | (40) | (27) | |
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Loss | (3) | $ (2) | (6) | $ (1) | ||
Contributions [Abstract] | ||||||
Defined Benefit Plan, Contributions by Employer | 85 | $ 160 | ||||
Anticipated additional contributions to the defined benefit and post retirement plans in current fiscal year | 75 | |||||
Anticipated total cash contributions to defined benefit and post retirement plans in the current year | $ 160 | $ 160 | ||||
[1] | Reclassified to Total Net Periodic Benefit Cost - refer to Note 14 - Employee Benefit Plans for additional information. | |||||
[2] | The six months ended June 30, 2015 and 2014, exclude defined contribution expense of $4 and $4, respectively, related to our ITO business, which was reported as a discontinued operation up to its sale on June 30, 2015. Refer to Note 5 - Divestitures for additional information regarding this sale. | |||||
[3] | The net actuarial (gain) loss for U.S. Plans primarily reflect; i) the remeasurement of our primary U.S. pension plans as a result of the payment of periodic settlements; and ii) adjustments for the actual valuation results based on January 1st plan census data. | |||||
[4] | Amounts represent the pre-tax effect included within Other comprehensive income (loss). Refer to Note 16 - Other Comprehensive Income (Loss) for related tax effects and the after-tax amounts. |
Shareholders Equity (Details 1)
Shareholders Equity (Details 1) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | [1] | $ 10,678 | $ 10,678 | ||||||
Noncontrolling Interests, Beginning Balance | [1] | 75 | 75 | ||||||
Total Equity, Beginning Balance | $ 10,753 | [1],[2] | $ 12,419 | 10,753 | [1],[2] | $ 12,419 | |||
Comprehensive income (loss), net attributable to Xerox | $ 253 | $ 302 | 97 | 524 | |||||
Comprehensive income (loss), net attributable to noncontrolling interests | 6 | 7 | 10 | 12 | |||||
Comprehensive income (loss), net including portion attributable to noncontrolling interests | 259 | 309 | 107 | 536 | |||||
Cash dividends declared - common | [3] | (155) | (148) | ||||||
Cash dividends declared - preferred | [4] | (12) | (12) | ||||||
Conversion of notes to common stock | 9 | ||||||||
Stock option and incentive plans, net | 57 | 93 | |||||||
Payments to acquire treasury stock, including fees | (611) | (479) | |||||||
Cancellation of treasury stock | 0 | 0 | |||||||
Distributions to noncontrolling interests | (42) | (13) | |||||||
Ending Balance | 10,054 | 10,054 | |||||||
Noncontrolling Interests, Ending Balance | 43 | 43 | |||||||
Total Equity, Ending Balance | $ 10,097 | $ 12,405 | $ 10,097 | $ 12,405 | |||||
Dividends per common share (in dollars per share) | $ 0.07 | $ 0.07 | $ 0.0625 | $ 0.0625 | $ 0.14 | $ 0.125 | |||
Dividends per preferred share (in dollars per share) | $ 20 | $ 20 | $ 20 | $ 20 | |||||
Xerox Shareholders’ Equity | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | $ 10,678 | [2] | $ 12,300 | $ 10,678 | [2] | $ 12,300 | |||
Comprehensive income (loss), net attributable to Xerox | 97 | 524 | |||||||
Cash dividends declared - common | [3] | (155) | (148) | ||||||
Cash dividends declared - preferred | [4] | (12) | (12) | ||||||
Conversion of notes to common stock | 9 | ||||||||
Stock option and incentive plans, net | 57 | 93 | |||||||
Payments to acquire treasury stock, including fees | (611) | (479) | |||||||
Cancellation of treasury stock | 0 | 0 | |||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||
Ending Balance | $ 10,054 | $ 12,287 | 10,054 | 12,287 | |||||
Common Stock | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | 1,124 | [2] | 1,210 | 1,124 | [2] | 1,210 | |||
Comprehensive income (loss), net attributable to Xerox | 0 | 0 | |||||||
Cash dividends declared - common | [3] | 0 | 0 | ||||||
Cash dividends declared - preferred | [4] | 0 | 0 | ||||||
Conversion of notes to common stock | 1 | ||||||||
Stock option and incentive plans, net | 3 | 6 | |||||||
Payments to acquire treasury stock, including fees | 0 | 0 | |||||||
Cancellation of treasury stock | (30) | (52) | |||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||
Ending Balance | 1,097 | 1,165 | 1,097 | 1,165 | |||||
Additional Paid-in Capital | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | 4,283 | [2] | 5,282 | 4,283 | [2] | 5,282 | |||
Comprehensive income (loss), net attributable to Xerox | 0 | 0 | |||||||
Cash dividends declared - common | [3] | 0 | 0 | ||||||
Cash dividends declared - preferred | [4] | 0 | 0 | ||||||
Conversion of notes to common stock | 8 | ||||||||
Stock option and incentive plans, net | 54 | 87 | |||||||
Payments to acquire treasury stock, including fees | 0 | 0 | |||||||
Cancellation of treasury stock | (370) | (531) | |||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||
Ending Balance | 3,967 | 4,846 | 3,967 | 4,846 | |||||
Treasury Stock | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | (105) | [2] | (252) | (105) | [2] | (252) | |||
Comprehensive income (loss), net attributable to Xerox | 0 | 0 | |||||||
Cash dividends declared - common | [3] | 0 | 0 | ||||||
Cash dividends declared - preferred | [4] | 0 | 0 | ||||||
Conversion of notes to common stock | 0 | ||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||
Payments to acquire treasury stock, including fees | (611) | [5] | (479) | ||||||
Cancellation of treasury stock | 400 | 583 | |||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||
Ending Balance | (316) | (148) | (316) | (148) | |||||
Retained Earnings (4) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | 9,535 | [2] | 8,839 | 9,535 | [2] | 8,839 | |||
Comprehensive income (loss), net attributable to Xerox | 237 | 547 | |||||||
Cash dividends declared - common | [3] | (155) | (148) | ||||||
Cash dividends declared - preferred | [4] | (12) | (12) | ||||||
Conversion of notes to common stock | 0 | ||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||
Payments to acquire treasury stock, including fees | 0 | 0 | |||||||
Cancellation of treasury stock | 0 | 0 | |||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||
Ending Balance | 9,605 | 9,226 | 9,605 | 9,226 | |||||
AOCL | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Beginning Balance | [6] | (4,159) | [2] | (2,779) | (4,159) | [2] | (2,779) | ||
Comprehensive income (loss), net attributable to Xerox | [6] | (140) | (23) | ||||||
Cash dividends declared - common | [3],[6] | 0 | 0 | ||||||
Cash dividends declared - preferred | [4],[6] | 0 | 0 | ||||||
Conversion of notes to common stock | [6] | 0 | |||||||
Stock option and incentive plans, net | [6] | 0 | 0 | ||||||
Payments to acquire treasury stock, including fees | [6] | 0 | 0 | ||||||
Cancellation of treasury stock | [6] | 0 | 0 | ||||||
Distributions to noncontrolling interests | [6] | 0 | 0 | ||||||
Ending Balance | [6] | (4,299) | (2,802) | (4,299) | (2,802) | ||||
Non-controlling Interests | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Noncontrolling Interests, Beginning Balance | $ 75 | [2] | $ 119 | 75 | [2] | 119 | |||
Comprehensive income (loss), net attributable to noncontrolling interests | 10 | 12 | |||||||
Cash dividends declared - common | [3] | 0 | 0 | ||||||
Cash dividends declared - preferred | [4] | 0 | 0 | ||||||
Conversion of notes to common stock | 0 | ||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||
Payments to acquire treasury stock, including fees | 0 | 0 | |||||||
Cancellation of treasury stock | 0 | 0 | |||||||
Distributions to noncontrolling interests | (42) | (13) | |||||||
Noncontrolling Interests, Ending Balance | $ 43 | $ 118 | $ 43 | $ 118 | |||||
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. | ||||||||
[2] | Balance at December 31, 2014 was revised - Refer to Note 1 - Basis of Presentation for additional information regarding this revision. | ||||||||
[3] | Cash dividends declared on common stock of $0.07 per share in each quarter of 2015 and $0.0625 per share in each quarter of 2014. | ||||||||
[4] | Cash dividends declared on preferred stock of $20.00 per share in each quarter of 2015 and 2014. | ||||||||
[5] | Includes associated fees. | ||||||||
[6] | Refer to Note 16 - Other Comprehensive Income (Loss) for components of AOCL. |
Shareholders Equity (Details 2)
Shareholders Equity (Details 2) - USD ($) shares in Thousands, $ in Millions | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | |||
Treasury Stock [Roll Forward] | ||||
Treasury Stock, Shares, Beginning (shares) | [1] | 7,609 | ||
Treasury Stock, Shares, Ending (shares) | 27,828 | |||
Treasury Stock, Value, Beginning | [1] | $ 105 | ||
Purchases | 611 | $ 479 | ||
Cancellation of treasury stock | 0 | 0 | ||
Treasury Stock, Value, Ending | $ 316 | |||
Treasury Stock | ||||
Treasury Stock [Roll Forward] | ||||
Treasury Stock, Shares, Beginning (shares) | 7,609 | |||
Purchases (in shares) | [2] | 50,081 | ||
Cancellations (in shares) | (29,862) | |||
Treasury Stock, Shares, Ending (shares) | 27,828 | |||
Treasury Stock, Value, Beginning | $ 105 | |||
Purchases | 611 | [2] | 479 | |
Cancellation of treasury stock | (400) | $ (583) | ||
Treasury Stock, Value, Ending | $ 316 | |||
[1] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. | |||
[2] | Includes associated fees. |
Other Comprehensive Loss (Detai
Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |||
Comprehensive Income [Abstract] | |||||||
Translation Adjustments Gains (Losses) | $ 191 | $ 92 | $ (315) | $ 94 | |||
Translation Adjustments Gains (Losses) , Net of Tax | [1] | 194 | 92 | (315) | 91 | ||
Changes in fair value of cash flow hedges - (losses) gains, pre-tax | (24) | 11 | 7 | 29 | |||
Changes in fair value of cash flow hedges - (losses) gains, net of tax | (18) | 7 | 7 | 20 | |||
Changes in cash flow hedges reclassed to earnings, pre-tax | [2] | 0 | 8 | 10 | 29 | ||
Changes in cash flow hedges reclassed to earnings, net of tax | [2] | (1) | 7 | 4 | 21 | ||
Other gains (losses), pre-tax | 1 | 1 | 0 | 0 | |||
Other gains (losses), net of tax | 0 | 1 | (1) | 0 | |||
Net Unrealized (Losses) Gains, Pre-tax | (23) | 20 | 17 | 58 | |||
Net Unrealized (Losses) Gains, Net of Tax | [1] | (19) | 15 | 10 | 41 | ||
Net actuarial gain (losses), pre-tax | 200 | (100) | 112 | (297) | |||
Net actuarial gain (losses), net of tax | 123 | (61) | 69 | (183) | |||
Prior service amortization/curtailment, pre-tax | [3] | (32) | (11) | (40) | (23) | ||
Prior service amortization/curtailment, net of tax | [3] | (19) | (7) | (24) | (14) | ||
Actuarial loss amortization/settlements, pre-tax | [3] | 46 | 33 | 99 | 61 | ||
Actuarial loss amortization/settlements, net of tax | [3] | 32 | 22 | 67 | 41 | ||
Fuji Xerox changes in defined benefit plans, net, pre-tax | [4] | 8 | 3 | 27 | 30 | ||
Fuji Xerox changes in defined benefit plans, net, net of tax | [4] | 8 | 3 | 27 | 30 | ||
Other (losses) gains, pre-tax | [5] | (76) | (27) | 27 | (28) | ||
Other (losses) gains, net of tax | [5] | (77) | (27) | 26 | (28) | ||
Change in Defined Benefit Plans Gains (Losses), Pre-tax | 146 | (102) | 225 | (257) | |||
Change in Defined Benefit Plans Gains (Losses), Net of Tax | [1] | 67 | (70) | 165 | (154) | ||
Other Comprehensive Income (Loss), Pre-Tax | 314 | 10 | (73) | (105) | |||
Other Comprehensive Income(Loss), Net of Tax | 242 | 37 | (140) | (22) | |||
Other comprehensive income attributable to noncontrolling interest, pre-tax | 1 | 1 | 0 | 1 | |||
Other comprehensive income attributable to noncontrolling interest, net of tax | 1 | 1 | 0 | 1 | |||
Other Comprehensive Income (Loss) Attributable to Xerox, Pre-tax | 313 | 9 | (73) | (106) | |||
Other Comprehensive Income (Loss), Attributable to Xerox, Net of Tax | 241 | $ 36 | (140) | $ (23) | |||
Cumulative translation adjustments | (2,058) | (2,058) | $ (1,743) | ||||
Other unrealized losses, net | (12) | (12) | (22) | ||||
Benefit plans net actuarial losses and prior service credits | [6] | (2,229) | (2,229) | (2,394) | |||
Total Accumulated Other Comprehensive Loss Attributable to Xerox | $ (4,299) | $ (4,299) | $ (4,159) | [7] | |||
[1] | Refer to Note 16 - Other Comprehensive Income (Loss) for gross components of Other Comprehensive Income (Loss), reclassification adjustments out of Accumulated Other Comprehensive Loss and related tax effects. | ||||||
[2] | Reclassified to Cost of sales - refer to Note 12 - Financial Instruments for additional information regarding our cash flow hedges. | ||||||
[3] | Reclassified to Total Net Periodic Benefit Cost - refer to Note 14 - Employee Benefit Plans for additional information. | ||||||
[4] | Represents our share of Fuji Xerox's benefit plan changes. | ||||||
[5] | Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL. | ||||||
[6] | Includes our share of Fuji Xerox. | ||||||
[7] | Certain prior year amounts have been revised - Refer to Note 1 - Basis of Presentation for additional information. |
Earnings per Share, Reconciliat
Earnings per Share, Reconciliation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Basic Earnings per Share: | ||||
Net income from continuing operations attributable to Xerox | $ 107 | $ 255 | $ 298 | $ 521 |
Adjusted Net Income From Continuing Operations Available to Common Shareholders | 101 | 249 | 286 | 509 |
Net (Loss) income from discontinued operations attributable to Xerox | (95) | 11 | (61) | 26 |
Adjusted Net Income Available to Common Shareholders | $ 6 | $ 260 | $ 225 | $ 535 |
Weighted average common shares outstanding | 1,087,720 | 1,160,842 | 1,098,370 | 1,170,177 |
Continuing operations (dollars per share) | $ 0.09 | $ 0.21 | $ 0.26 | $ 0.43 |
Discontinued operations (dollars per share) | (0.08) | 0.01 | (0.06) | 0.03 |
Total Basic Earnings per Share (dollars per share) | $ 0.01 | $ 0.22 | $ 0.20 | $ 0.46 |
Diluted Earnings per Share: | ||||
Net income from continuing operations attributable to Xerox | $ 107 | $ 255 | $ 298 | $ 521 |
Adjusted Net Income From Continuing Operations Available to Common Shareholders | 101 | 249 | 286 | 509 |
Net (Loss) income from discontinued operations attributable to Xerox | (95) | 11 | (61) | 26 |
Adjusted Net Income Available to Common Shareholders | $ 6 | $ 260 | $ 225 | $ 535 |
Weighted average common shares outstanding | 1,087,720 | 1,160,842 | 1,098,370 | 1,170,177 |
Common shares issuable with respect to: | ||||
Adjusted Weighted Average Common Shares Outstanding | 1,105,269 | 1,180,759 | 1,115,285 | 1,189,338 |
Continuing operations (dollars per share) | $ 0.09 | $ 0.21 | $ 0.26 | $ 0.43 |
Discontinued operations (dollars per share) | (0.08) | 0.01 | (0.06) | 0.02 |
Total Diluted Earnings per Share (dollars per share) | $ 0.01 | $ 0.22 | $ 0.20 | $ 0.45 |
Stock options [Member] | ||||
Common shares issuable with respect to: | ||||
Stock options and Restricted stock and performance shares (in shares) | 1,409 | 3,116 | 1,615 | 3,369 |
Restricted Stock and Performance Shares [Member] | ||||
Common shares issuable with respect to: | ||||
Stock options and Restricted stock and performance shares (in shares) | 16,140 | 16,801 | 15,300 | 15,792 |
Convertible Preferred Stock [Member] | ||||
Common shares issuable with respect to: | ||||
Convertible preferred stock | 0 | 0 | 0 | 0 |
Earnings (loss) per share, basic [Member] | ||||
Basic Earnings per Share: | ||||
Accrued dividends on preferred stock | $ (6) | $ (6) | $ (12) | $ (12) |
Earnings (loss) per share, diluted [Member] | ||||
Basic Earnings per Share: | ||||
Accrued dividends on preferred stock | $ (6) | $ (6) | $ (12) | $ (12) |
Earnings per Share, Anti Diluti
Earnings per Share, Anti Dilutive Securities (Details) - $ / shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 43,537 | 48,428 | 44,170 | 49,184 | ||
Dividends per common share (in dollars per share) | $ 0.07 | $ 0.07 | $ 0.0625 | $ 0.0625 | $ 0.14 | $ 0.125 |
Stock options [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 2,590 | 5,566 | 2,384 | 5,313 | ||
Restricted Stock and Performance Shares [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 13,981 | 15,896 | 14,820 | 16,905 | ||
Convertible preferred stock [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 26,966 | 26,966 | 26,966 | 26,966 |
Contingencies and Litigation (D
Contingencies and Litigation (Details) - Brazil Tax And Labor Contingencies [Member] - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Loss Contingencies [Line Items] | ||
Unreserved tax and labor contingencies | $ 728 | $ 817 |
Escrow cash deposits | 90 | |
Net book value of assets with liens | 17 | |
Letters of credit | $ 223 |
Contingencies and Litigation, O
Contingencies and Litigation, Other Contingencies (Details) - Jun. 30, 2015 loans in Millions, $ in Millions | USD ($)loans |
Letter of Credit [Member] | |
Guarantor Obligations [Line Items] | |
Maximum exposure, undiscounted | $ 426 |
Surety Bond [Member] | |
Guarantor Obligations [Line Items] | |
Maximum exposure, undiscounted | $ 656 |
Federal Family Education Loan Program (FFELP) Guaranteed Loans [Member] | |
Guarantor Obligations [Line Items] | |
Outstanding Student Loan Portfolio, Loans | loans | 2.5 |
Outstanding Principal Balance - Student Loan Portfolio | $ 36,100 |
Reserves for losses on defaulted loans | $ 3 |