Xerox 8-K Results of Operations and Financial Condition

Xerox Financial Information	Exhibit 99.1
(unaudited)

(in millions, except per-share data)		2013 (Revised)(1)															2014 (Revised)(1)
		Q1			Q2			Q3			Q4			FY			Q1			Q2			Q3			Q3 YTD
Revenues
Sales		$	1,279		$	1,432		$	1,352		$	1,519		$	5,582		$	1,257		$	1,342		$	1,275		$	3,874
Outsourcing, maintenance and rentals			3,460			3,497			3,415			3,569			13,941			3,414			3,501			3,424			10,339
Financing			118			113			133			119			483			100			98			96			294
Total Revenues			4,857			5,042			4,900			5,207			20,006			4,771			4,941			4,795			14,507
Cost of Revenue
Cost of sales			804			915			851			980			3,550			778			832			774			2,384
Cost of outsourcing, maintenance and rentals			2,461			2,429			2,395			2,523			9,808			2,454			2,488			2,444			7,386
Cost of financing			43			42			40			38			163			36			36			35			107
Total Cost of Revenue			3,308			3,386			3,286			3,541			13,521			3,268			3,356			3,253			9,877
Gross Profit
Sales gross profit			475			517			501			539			2,032			479			510			501			1,490
Outsourcing, maintenance and rentals gross profit			999			1,068			1,020			1,046			4,133			960			1,013			980			2,953
Financing gross profit			75			71			93			81			320			64			62			61			187
Gross Profit			1,549			1,656			1,614			1,666			6,485			1,503			1,585			1,542			4,630
Research, development & engineering			155			149			146			153			603			145			143			139			427
Bad debt expense			24			33			27			36			120			14			22			18			54
Selling, administrative and general exp. (excl. bad debts)			1,000			992			974			987			3,953			931			937			924			2,792
Total selling, administrative and general exp.			1,024			1,025			1,001			1,023			4,073			945			959			942			2,846
Non-financing interest expense			61			61			59			59			240			63			60			56			179
Aggregate exchange (gains) / losses			(4	)		(3	)		1			(1	)		(7	)		1			(1	)		—			—
All other, net			(41	)		1			(22	)		(25	)		(87	)		(25	)		6			15			(4	)
Total Other, net			16			59			38			33			146			39			65			71			175
Restructuring and asset impairment charges			(8	)		33			35			55			115			26			39			27			92
Amortization of intangible assets			76			76			77			76			305			77			78			77			232
Total Costs and Expenses			4,571			4,728			4,583			4,881			18,763			4,500			4,640			4,509			13,649
Income before Income Taxes & Equity Income			286			314			317			326			1,243			271			301			286			858
Income Taxes			46			61			79			67			253			42			73			66			181
Equity in Net Income of Unconsol. Affil.			47			36			43			43			169			42			33			44			119
Income from Continuing Operations			287			289			281			302			1,159			271			261			264			796
Income (Loss) from Discontinued Operations, net of tax			13			(12	)		10			9			20			15			11			8			34
Net Income			300			277			291			311			1,179			286			272			272			830
Less: Net Income attributable to Noncontrolling Interests			4			6			5			5			20			5			6			6			17
Net Income attributable to Xerox Corporation		$	296		$	271		$	286		$	306		$	1,159		$	281		$	266		$	266		$	813
Adjusted Average Shares	- Basic		1,225			1,230			1,236			1,214			1,225			1,179			1,161			1,149			1,163
	- Diluted		1,280			1,287			1,286			1,261			1,274			1,225			1,208			1,192			1,208
Earnings Per Share	- Basic:
	Continuing Operations		0.23			0.23			0.22			0.24			0.91			0.22			0.21			0.22			0.65
	Discontinued Operations		0.01			(0.01	)		0.01			0.01			0.02			0.01			0.01			0.01			0.03
	Total Basic Earnings per Share		0.24			0.22			0.23			0.25			0.93			0.23			0.22			0.23			0.68
	-Diluted:
	Continuing Operations		0.22			0.22			0.21			0.23			0.89			0.22			0.21			0.21			0.64
	Discontinued Operations		0.01			(0.01	)		0.01			0.01			0.02			0.01			0.01			0.01			0.03
	Total Diluted Earnings per Share		0.23			0.21			0.22			0.24			0.91			0.23			0.22			0.22			0.67
	- Adjusted:
	Adjusted Net Income		330			330			324			344			1,328			314			303			306			923
	Adjusted Earnings per Share(2)		0.26			0.26			0.25			0.27			1.04			0.26			0.25			0.26			0.76
	Intangible Amortization(2)		0.04			0.04			0.04			0.04			0.15			0.04			0.04			0.05			0.12
Key Ratios:
Gross Margins	- Sales		37.1	%		36.1	%		37.1	%		35.5	%		36.4	%		38.1	%		38.0	%		39.3	%		38.5	%
	- Outsourcing/Maintenance/Rentals		28.9	%		30.5	%		29.9	%		29.3	%		29.6	%		28.1	%		28.9	%		28.6	%		28.6	%
	- Financing		63.6	%		62.8	%		69.9	%		68.1	%		66.3	%		64.0	%		63.3	%		63.5	%		63.6	%
	- Total		31.9	%		32.8	%		32.9	%		32.0	%		32.4	%		31.5	%		32.1	%		32.2	%		31.9	%
SAG as a % of Revenue			21.1	%		20.3	%		20.4	%		19.6	%		20.4	%		19.8	%		19.4	%		19.6	%		19.6	%
Tax Rate			16.1	%		19.4	%		24.9	%		20.6	%		20.4	%		15.5	%		24.3	%		23.1	%		21.1	%
Other Data:
Amortization of purchased intangibles (after taxes)		$	47		$	47		$	48		$	47		$	189		$	48		$	48		$	48		$	144

⁽¹⁾  Revised for the reclassification of the ITO business from Services segment to discontinued operations.

⁽²⁾  Adjusted Earnings per Share is a non-GAAP measure and represents Diluted EPS from Continuing Operations before the after-tax amortization of intangible assets.

Xerox Corporation Business Segment Performance

(unaudited)

(in millions)	2013 (Revised)(1)															2014 (Revised)(1)
	Q1			Q2			Q3			Q4			FY			Q1			Q2			Q3			Q3 YTD
Revenues
Services	$	2,584		$	2,613		$	2,596		$	2,686		$	10,479		$	2,585		$	2,651		$	2,623		$	7,859
Document Technology		2,135			2,263			2,159			2,351			8,908			2,044			2,126			2,029			6,199
Other		138			166			145			170			619			142			164			143			449
Total Revenues	$	4,857		$	5,042		$	4,900		$	5,207		$	20,006		$	4,771		$	4,941		$	4,795		$	14,507
Segment Profit (Loss)
Services	$	250		$	276		$	268		$	261		$	1,055		$	222		$	226		$	240		$	688
Document Technology		186			245			260			273			964			249			306			284			839
Other		(68	)		(61	)		(54	)		(34	)		(217	)		(50	)		(75	)		(82	)		(207	)
Segment Profit (Loss)	$	368		$	460		$	474		$	500		$	1,802		$	421		$	457		$	442		$	1,320
Segment Margin
Services		9.7	%		10.6	%		10.3	%		9.7	%		10.1	%		8.6	%		8.5	%		9.1	%		8.8	%
Document Technology		8.7	%		10.8	%		12.0	%		11.6	%		10.8	%		12.2	%		14.4	%		14.0	%		13.5	%
Other		(49.3	%)		(36.7	%)		(37.2	%)		(20.0	%)		(35.1	%)		(35.2	%)		(45.7	%)		(57.3	%)		(46.1	%)
Segment Margin		7.6	%		9.1	%		9.7	%		9.6	%		9.0	%		8.8	%		9.2	%		9.2	%		9.1	%

(1) Revised for the reclassification of the ITO business from Services segment to discontinued operations. Segment profit for our other segments, Document Technology and Other, were impacted by minor reallocation of expenses as well as rounding.