The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Ananda Baruah - Loop Capital Markets LLC - Analyst
: Yes. Hey, guys, good morning. And thanks for taking the question. I guess two, if I could, on the product. The first is on the product delay and on
the sales productivity dynamics that you guys talked to, and you did give a lot of good context around it. I guess the question is, can you -- if you
mentioned, I missed it. Specifically on the product delay, what was it that you guys saw as occurring?
And I guess, sort of in that context, what did you learn that can have -- that can sort of have sort of these dynamics not pop up again? And then I
guess also on the sales productivity, any greater specificity around -- what actually occurred that surprised you guys that sort of led to the diminished
sales productivity? And then I just have a quick follow up as well. Thanks.
Question: Ananda Baruah - Loop Capital Markets LLC - Analyst
: That's all super useful context, and I really appreciate it. So just a quick follow up to that, and then I'll see you on the floor. Any sense of sort of
macro or the general market demand backdrop? Was it a bit softer? And if that was also a contributor to the sort of, John, the flattening, Q over Q,
and sort of efficiency progression -- sales efficiency progression?
Question: Ananda Baruah - Loop Capital Markets LLC - Analyst
: Got it. Thanks, guys.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Great. Thanks so much for taking my questions this morning. I have two, if I may. Maybe just to start, Steve, if we step back, you guys are doing a
lot, right? You're exiting businesses, you're changing the delivery model in several regions, you're reducing headcount, you're launching new
products, you're acquiring new businesses, and this is all happening at the same time while your end markets do face demand headwinds.
That's tough, and I credit you for taking all these actions. But as I think about your preliminary comments on 2025, you're setting an expectation
for revenue growth, operating income growth, and margin expansion. And I'm just wondering why you think that is the right expectation to set
today, given everything that's happened in the background, and obviously given some of the challenges that you run into this year, which some
you could theoretically face next year as you continue to go through this reinvention.
So just -- maybe the question is, amidst all of these changes and moving pieces, what gives you the confidence to say we can get back to growth
and margin expansion next year? And then I have a follow up, please.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Okay, super. Thank you, Steve. And then maybe just as a quick follow up or just point of clarification, so you guys have adjusted EBITDA margins
close to 9%. I believe that just with the disclosures that you provided on ITsavvy, EBITDA margins are around 7%, so you guys talked about this
asset being dilute, excuse me, accretive immediately.
Can you just help us understand some of the math that you're getting to that accretion in terms of either revenue synergies? I know you alluded
to some cost synergies, but if you could just kind of in totality help us understand the assumptions around this being accretive, that would be super
helpful. Thank you.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: And Xavier, maybe just one final point of clarification. As we incorporate ITsavvy into the model, is that -- I assume it flows through services,
maintenance, and rentals line, just as we think about our model. I just want to make sure we're kind of incorporating that correctly. Thanks.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Awesome. Thank you so much.
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OCTOBER 29, 2024 / 12:00PM, XRX.OQ - Q3 2024 Xerox Holdings Corp Earnings Call
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