Conduent(US:CNDT)2025-11-07 13:04Financial Performance - For Q3 2025, Conduent reported a net loss of $46 million, compared to a net income of $123 million in Q3 2024, representing a significant decline[14] - Comprehensive loss for Q3 2025 was $50 million, down from a comprehensive income of $137 million in the same quarter last year[14] - Conduent reported a net loss of $46 million for the three months ended September 30, 2025, compared to a net income of $123 million for the same period in 2024, representing a decline of 137%[22] - Total comprehensive loss for the three months ended September 30, 2025, was $50 million, compared to a total comprehensive income of $137 million for the same period in 2024[22] - The company reported an income (loss) before income taxes of $(38) million for Q3 2025, compared to $159 million in Q3 2024[50] - Basic net earnings per share for Q3 2025 were $(0.30), down from $0.75 in Q3 2024, indicating a negative trend in profitability[106] Assets and Liabilities - Total assets decreased to $2.5 billion as of September 30, 2025, down from $2.6 billion at the end of 2024[17] - Cash and cash equivalents fell to $248 million, a decrease of $118 million from $366 million at the end of 2024[17] - Long-term debt increased to $697 million, up from $615 million at the end of 2024, indicating rising financial leverage[17] - The balance of retained earnings (deficit) increased to $(2,577) million as of September 30, 2025, from $(2,418) million as of September 30, 2024, indicating a deterioration in retained earnings[22] - The total other current assets decreased slightly to $258 million as of September 30, 2025, from $261 million at the end of 2024[108] - Total other current liabilities remained stable at $289 million as of September 30, 2025, compared to $290 million at the end of 2024[108] Revenue and Segments - Total consolidated revenue for Q3 2025 was $767 million, a decrease of 5% from $807 million in Q3 2024[38] - Commercial segment revenue decreased to $367 million in Q3 2025 from $385 million in Q3 2024, representing a decline of 4.7%[38] - Government segment revenue decreased to $238 million in Q3 2025 from $255 million in Q3 2024, a decline of 6.7%[38] - Transportation segment revenue increased to $162 million in Q3 2025 from $141 million in Q3 2024, marking a growth of 14.9%[38] - For the nine months ended September 30, 2025, total revenue was $2.272 billion, down from $2.556 billion in the same period of 2024, a decrease of 11.1%[38] Cash Flow and Operating Activities - Net cash used in operating activities for the nine months ended September 30, 2025, was $112 million, compared to a net cash used of $91 million in the same period of 2024[19] - Proceeds from divestitures amounted to $53 million in the nine months ended September 30, 2025, significantly lower than $823 million in the same period of 2024[19] Equity and Stock - The company had treasury stock purchases amounting to $13 million in Q3 2025, compared to $14 million in Q3 2024[22] - Conduent's additional paid-in capital increased to $3,964 million as of September 30, 2025, up from $3,952 million as of September 30, 2024[22] - The company had a total equity of $717 million as of September 30, 2025, down from $881 million as of September 30, 2024[22] - The Company issued 120,000 shares of Series A convertible perpetual preferred stock with a liquidation preference of $120 million, earning quarterly cash dividends at a rate of 8% per year[105] - The Company has not declared any common stock dividends during the periods presented, indicating a focus on retaining earnings[106] Restructuring and Costs - The company incurred restructuring costs totaling $24 million for the nine months ended September 30, 2025, compared to $21 million for the same period in 2024[64] - The company has ongoing restructuring programs aimed at reducing costs and improving productivity, with potential future provisions for new initiatives[62] Debt and Financial Obligations - As of September 30, 2025, the Company had $134 million in outstanding borrowings under its Revolving Credit Facility and utilized $25 million for letters of credit[77] - The Company had a remaining unused capacity of $198 million under the Revolving Credit Facility and $11 million under the Performance Letter of Credit Facility as of September 30, 2025[77] - The Company was in compliance with all debt covenants, including a consolidated first lien net leverage ratio not exceeding 4.50 to 1.00 and a fixed charge coverage ratio of at least 2.50 to 1.00[79] - The Company recognized a loss on extinguishment of debt of $1 million for the three months ended September 30, 2025, related to the voluntary repayment of Term Loan A[78] Market Conditions and Challenges - The company has faced challenges related to geopolitical events and macroeconomic conditions, impacting its operational performance and market competitiveness[7] Other Financial Information - The Company recognized an expense related to defined contribution plans of $4 million for the nine months ended September 30, 2025[91] - The balance of Accumulated Other Comprehensive Loss (AOCL) was $(441) million as of September 30, 2025, reflecting a change from $(472) million at December 31, 2024[93] - The Company believes it has recorded adequate provisions for various claims and litigation as of September 30, 2025, but the ultimate outcome remains unpredictable[94] - The Company had outstanding forward exchange contracts with gross notional values of $239 million as of September 30, 2025, with approximately 81% maturing within three months[81] - The fair value of the Company's long-term debt was estimated at $697 million as of September 30, 2025, compared to a fair value of $676 million as of December 31, 2024[88] - The Company had $546 million of outstanding surety bonds and $131 million of outstanding letters of credit as of September 30, 2025, to secure performance obligations[104]