Core Insights - Five stocks have been added to the Zacks Rank 1 (Strong Buy) List, indicating strong potential for investment Group 1: Company Performance - Great Lakes Dredge & Dock (GLDD) has seen a 34.8% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - AppLovin (APP) has experienced a 12.5% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2] - The ODP Corporation (ODP) has seen a 9% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [3] - Suzano (SUZ) has experienced a 7.8% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [3] - Ferrari (RACE) has seen a 5.3% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [4]

Financial Data and Key Metrics Changes - The company generated total revenue of $1.7 billion in Q1 2025, reflecting a 9% decline compared to the same quarter last year, but showing improvement in year-over-year trends compared to prior quarters [19] - Adjusted EBITDA was $76 million, down from $91 million in the previous year, while adjusted free cash flow increased significantly to $45 million, more than double the $17 million generated in the same period last year [21][23] - GAAP operating loss was $32 million, compared to a GAAP operating income of $41 million in the prior year, primarily due to restructuring expenses and asset impairments [20] Business Line Data and Key Metrics Changes - The consumer division, Office Depot, reported sales of $838 million, down 11% year-over-year, but showed a 500 basis point improvement in same-store sales compared to the previous year [23][24] - ODP Business Solutions reported revenue of $852 million, down 8% year-over-year, impacted by cautious business conditions and a large customer loss from the previous year [26] - The supply chain business, VARE, achieved over 85% year-over-year revenue growth from third-party customers, highlighting strong demand for its services [12][31] Market Data and Key Metrics Changes - The company is expanding into the hospitality market, which is valued at $16 billion, and has established partnerships with major suppliers to support this initiative [14][15] - The onboarding of new business contracts, including a significant contract with CoreTrust, is ongoing, with expectations for these to contribute more meaningfully in the second half of the year [11][27] Company Strategy and Development Direction - The company is focused on its "Optimize for Growth" plan, which aims to realign its organizational structure and reduce fixed costs while enhancing its B2B pivot and expanding into higher growth segments [7][16] - The strategy includes reducing reliance on retail and increasing operational flexibility, with a focus on capitalizing on core strengths in supply chain and distribution [7][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improving trends within the consumer business and anticipates better performance in the B2B segment as new customers are onboarded and the hospitality sector gains traction [36][39] - The company is actively monitoring the evolving tariff situation and has taken proactive measures to mitigate potential impacts, including diversifying sourcing strategies [35][66] Other Important Information - The company closed nine retail stores as part of its restructuring plan and eliminated areas of corporate support to reduce costs [17] - Total liquidity at the end of the quarter was $653 million, consisting of $185 million in cash and $468 million in available credit [33] Q&A Session Summary Question: Insights into retail momentum and sales strategies - Management highlighted four key strategies driving improved performance: enhanced customer engagement, a revised merchandising strategy, a daily management system, and targeted sales promotions [42][44][46] Question: Future pace of store closures - The company will evaluate store closures based on optimizing cash flow and margin dollars, with ongoing assessments of store performance [49][50] Question: Onboarding delays for new contracts - Delays are attributed to longer lead times in the hospitality sector and the complexity of onboarding large contracts like CoreTrust [52][54] Question: Categories strengthening in retail - Management noted success in non-tariff categories and a shift to a more value-oriented merchandising strategy, which has improved sales [61][62] Question: Impact of tariffs on business - The company believes it has mitigated most tariff impacts through strategic sourcing and pricing adjustments, with ongoing monitoring of the situation [64][66] Question: Converting new business pipeline into revenue - New leadership and a rigorous management system are being implemented to enhance the conversion of the business pipeline into revenue [88][90] Question: Update on stock buyback - Management reassured that they continually evaluate stock repurchase opportunities, reflecting confidence in the company's future [93]

Financial Data and Key Metrics Changes - The company generated total revenue of $1.7 billion in Q1 2025, reflecting a 9% decline compared to the same quarter last year, but showing improvement in year-over-year trends compared to prior quarters [19] - Adjusted EBITDA for the quarter was $76 million, down from $91 million in the previous year, while adjusted free cash flow increased significantly to $45 million from $17 million [22][24] - GAAP operating loss was $32 million compared to a GAAP operating income of $41 million in the prior year, with adjusted operating income at $54 million, down from $66 million [20] Business Line Data and Key Metrics Changes - The consumer division, Office Depot, reported sales of $838 million, down 11% year-over-year, but showed a 500 basis point improvement in same-store sales metrics [24][25] - ODP Business Solutions reported revenue of $852 million, down 8% year-over-year, impacted by cautious business conditions and a large customer loss from the previous year [27] - The supply chain business, VARE, achieved over 85% year-over-year revenue growth from third-party customers, with third-party revenue reaching $17 million, up 89% [12][32] Market Data and Key Metrics Changes - The company is expanding into the hospitality market, which is valued at $16 billion, and has established partnerships with major suppliers to support this initiative [13][14] - The onboarding of new business contracts, including a significant contract with CoreTrust, is ongoing, with expectations for these to contribute more meaningfully in the second half of the year [11][28] Company Strategy and Development Direction - The company is focused on a B2B pivot and expanding into higher growth segments such as hospitality and supply chain services, while reducing reliance on retail [7][16] - The "Optimize for Growth" restructuring plan aims to realign organizational structure and reduce fixed costs, with nine retail stores closed during the quarter [17][20] - The company is actively managing its balance sheet and liquidity, ending the quarter with total liquidity of $653 million [34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improving trends within the consumer business and anticipates better performance in the B2B segment as new customers are onboarded [37][39] - The company is closely monitoring the evolving tariff situation and has taken proactive measures to mitigate potential impacts [36][41] - Management expects significant improvements in adjusted free cash flow generation compared to the previous year, with a focus on driving cash and margin [37][39] Other Important Information - The company has made significant progress in cash management, achieving a cash conversion improvement that contributed to the increase in adjusted free cash flow [13] - The company is evaluating the pace of store closures in light of improved retail performance and ongoing strategic initiatives [51] Q&A Session Summary Question: Insights into retail momentum and sales strategies - Management highlighted four key strategies driving improved performance, including enhanced customer engagement, a revised merchandising strategy, daily performance management, and targeted sales promotions [44][48] Question: Future pace of store closures - Management indicated that the "Optimize for Growth" plan will evaluate store performance to maximize cash flow and margin, with ongoing assessments of store closures [51][52] Question: Onboarding delays for new contracts - Management noted that onboarding delays are due to longer lead times in the hospitality sector and the complexity of large contracts like CoreTrust [55][56] Question: Categories showing strength in retail - Management reported success in non-tariff categories and a shift to a more value-oriented merchandising strategy, which has improved sales performance [63][64] Question: Impact of tariffs on business - Management believes they have mitigated most tariff impacts through diversified sourcing strategies and proactive pricing adjustments [66][68] Question: Converting new business pipeline into revenue - Management is focusing on bringing in qualified leadership, rigorous management systems, and frequent high-level meetings with new partners to drive conversion [90][91] Question: Update on stock buyback - Management stated that they continually evaluate stock repurchase opportunities and have confidence in the company's future [96]

Financial Performance - Consolidated YOY comparable revenue trends improved in Q1 2025[9] - Adjusted free cash flow significantly increased YOY, reaching $45 million in Q1 2025, compared to $17 million in the same period last year[9, 19] - Adjusted EBITDA was $76 million[18, 23] - Adjusted operating income was $54 million[18, 23] Business Segments - Office Depot's same store sales improved by 500 basis points YOY[9] - Veyer's revenue from third-party customers grew strongly, up 89% to $17 million in Q1 2025[9, 34] - ODP Business Solutions' adjacency categories accounted for 44% of the division's total revenue[28] Strategic Initiatives - The company is executing the "Optimize for Growth" plan, expecting a $380 million uplift in EBITDA and $1.3 billion in total value creation[12] - The company closed 9 retail store locations in Q1 2025, incurring $48 million in restructuring costs[12] - The company is expanding into the hospitality market, a $16 billion addressable market[10, 11] Financial Position - The company has a strong liquidity position, with $653 million in total available liquidity, including $185 million in cash and cash equivalents[38]

Group 1: Earnings Performance - Acco Brands reported a quarterly loss of $0.02 per share, better than the Zacks Consensus Estimate of a loss of $0.04, and compared to earnings of $0.03 per share a year ago, indicating a 50% earnings surprise [1] - The company posted revenues of $317.4 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 0.43%, and down from year-ago revenues of $358.9 million [2] - Over the last four quarters, Acco has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2] Group 2: Stock Performance and Outlook - Acco shares have declined approximately 26.5% since the beginning of the year, while the S&P 500 has decreased by 5.3% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $0.34 on revenues of $404.1 million, and for the current fiscal year, it is $1.02 on revenues of $1.56 billion [7] Group 3: Industry Context - The Office Supplies industry, to which Acco belongs, is currently ranked in the bottom 12% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5][6]

Core Viewpoint - Xerox Holdings Corporation reported a quarterly loss of $0.06 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.05, marking an earnings surprise of -20% [1] - The company has consistently missed consensus EPS estimates over the last four quarters [2] Financial Performance - Xerox posted revenues of $1.46 billion for the quarter ended March 2025, missing the Zacks Consensus Estimate by 3.19%, compared to $1.5 billion in revenues a year ago [2] - The company has only surpassed consensus revenue estimates once in the last four quarters [2] Stock Performance - Xerox shares have declined approximately 47.7% since the beginning of the year, in contrast to the S&P 500's decline of -5.3% [3] - The current Zacks Rank for Xerox is 4 (Sell), indicating expected underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.25 on revenues of $1.58 billion, and for the current fiscal year, it is $0.72 on revenues of $6.25 billion [7] - The trend for estimate revisions ahead of the earnings release has been unfavorable [6] Industry Context - The Office Supplies industry, to which Xerox belongs, is currently ranked in the bottom 13% of over 250 Zacks industries, suggesting a challenging environment [8]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $1.6 billion, down approximately 10% compared to the same quarter last year, primarily due to lower sales in the retail business and reduced consumer traffic [44][50] - GAAP operating income for Q4 was $20 million, down from $52 million in the prior year, with adjusted operating income at $32 million compared to $57 million [45][50] - Adjusted net income from continuing operations for Q4 was $20 million or $0.66 per diluted share, down from $43 million or $1.13 per diluted share in the prior year [47][50] - Full-year 2024 total company sales were $7 billion, down from $7.8 billion in 2023, with adjusted net income from continuing operations at $114 million or $3.30 per share, compared to $263 million or $6.61 per share in the prior year [49][51] Business Line Data and Key Metrics Changes - ODP Business Solutions revenue for Q4 was $827 million, down 9% year-over-year, influenced by a weak macroeconomic environment and reduced enterprise spending [54] - Office Depot's revenue for Q4 was $784 million, a 13% decline driven by fewer retail stores and lower consumer demand [58] - Veyor's third-party revenue increased by 150% year-over-year, reaching $20 million, while consolidated sales were $1.1 billion [63] Market Data and Key Metrics Changes - The hospitality industry represents a $16 billion market, with ODP securing a key supplier agreement, marking a significant entry into this growing sector [16][28] - The overall addressable market opportunity, including healthcare and other sectors, is estimated to exceed $60 billion [32] Company Strategy and Development Direction - The company is focusing on a B2B pivot, expanding beyond traditional office supplies into higher growth segments, including hospitality and healthcare [12][34] - An "optimized for growth" restructuring plan has been launched to accelerate revenue growth in B2B while reducing reliance on retail operations [34][36] - The company aims to leverage its supply chain and distribution capabilities to capture new business opportunities and enhance customer service [13][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in 2024 due to macroeconomic factors and competitive pressures but expressed optimism about future growth opportunities [10][38] - The company expects to see benefits from its B2B initiatives and the hospitality sector, with a focus on long-term sustainable growth [41][78] Other Important Information - The company ended the quarter with total liquidity of $644 million and total debt of $279 million, maintaining a solid balance sheet [66] - Capital expenditures in Q4 were $25 million, flat with the prior year, primarily focused on growth investments [48] Q&A Session Summary Question: Can you discuss the genesis of the hospital deal? - The deal originated from an existing relationship, with the customer recognizing the need for a reliable supply chain, leading to ODP being selected as a preferred partner [81][82] Question: How should we think about the revenue ramp from this deal? - The revenue ramp will be a combination of exclusive products and a "hunting license" approach, with joint sales efforts expected to enhance growth [90] Question: What is the timeframe for the optimize for growth plan? - The plan is a multiyear initiative, expected to take three to four years to realize the projected EBITDA uplift [94] Question: Have you considered strategic alternatives for the retail business? - The company is always exploring ways to maximize shareholder value, including potential strategic alternatives for the retail segment [97] Question: What are your assumptions for growth in the B2B office suppliers market? - The B2B segment is expected to hold steady, with ongoing challenges in the office supply sector making market share difficult to gauge [106] Question: How much exposure does ODP have to the federal government? - ODP does not have significant exposure to federal business at this moment [112]

Q120 Fourth Quarter & Full Year 2024 Financial Results v Safe Harbor Statement The Private Securities Litigation Reform Act of 1995, as amended, (the "Act"), provides protection from liability in private lawsuits for "forward-looking" statements made by public companies under certain circumstances, provided that the public company discloses with specificity the risk factors that may impact its future results. The Company wants to take advantage of the "safe harbor" provisions of the Act. Certain statements ...