Gross margins have compressed significantly to 12.3% in 2026Q1, down from 22.4% in 2023Q4, reflecting ongoing difficulties in maintaining pricing power and operational efficiency.
| Sales/Revenue | 3.01B | 3.04B | 3.36B | 3.72B | 3.86B | 4.14B | 4.16B | 4.47B | 5.39B | 6.02B | 6.41B | 6.66B | 6.94B |
| Revenue Growth % | -5.4% | -9.36% | -9.83% | -3.53% | -6.81% | -0.55% | -6.81% | -17.17% | -10.45% | -6.02% | -3.81% | -3.98% | - |
| Cost of Goods Sold | 2.51B | 2.49B | 2.73B | 2.89B | 3.02B | 3.14B | 3.21B | 3.49B | 4.18B | 4.98B | 5.5B | 5.98B | 5.8B |
| COGS % of Revenue | - | 81.85% | 81.35% | 77.59% | 78.23% | 75.8% | 77.08% | 78.22% | 77.55% | 82.65% | 85.8% | 89.72% | 83.6% |
| Gross Profit | 508M | 552M | 626M | 834M | 840M | 1B | 954M | 973M | 1.21B | 1.04B | 910M | 685M | 1.14B |
| Gross Margin % | 16.85% | 18.15% | 18.65% | 22.41% | 21.77% | 24.2% | 22.92% | 21.78% | 22.45% | 17.35% | 14.2% | 10.28% | 16.4% |
| Gross Profit Growth % | - | -11.82% | -24.94% | -0.71% | -16.17% | 5.03% | -1.95% | -19.65% | 15.89% | 14.84% | 32.85% | -39.81% | - |
| Operating Expenses | 433M | 610M | 461M | 465M | 677M | 900M | 469M | 487M | 1.03B | 871M | 997M | 1B | 955M |
| OpEx % of Revenue | - | 20.05% | 13.74% | 12.49% | 17.55% | 21.74% | 11.27% | 10.9% | 19.12% | 14.46% | 15.56% | 15.03% | 13.76% |
| Selling, General & Admin | 187M | 412M | 0 | 0 | 440M | 544M | 0 | 0 | 560M | 615M | 686M | 699M | 659M |
| SG&A % of Revenue | - | 13.54% | - | - | 11.4% | 13.14% | - | - | 10.38% | 10.21% | 10.71% | 10.49% | 9.5% |
| Research & Development | 4M | 4M | 6M | 7M | 7M | 4M | 1M | 8M | 11M | 13M | 31M | 52M | 46M |
| R&D % of Revenue | - | 0.13% | 0.18% | 0.19% | 0.18% | 0.1% | 0.02% | 0.18% | 0.2% | 0.22% | 0.48% | 0.78% | 0.66% |
| Other Operating Expenses | 3M | 194M | 455M | 458M | 230M | 352M | 468M | 479M | -5M | 18M | -34M | -38M | 2M |
| Operating Income | 75M | -58M | 165M | 369M | 163M | 102M | 485M | 486M | 180M | 174M | -87M | -316M | 183M |
| Operating Margin % | 2.49% | -1.91% | 4.92% | 9.91% | 4.23% | 2.46% | 11.65% | 10.88% | 3.34% | 2.89% | -1.36% | -4.74% | 2.64% |
| Operating Income Growth % | - | -135.15% | -55.28% | 126.38% | 59.8% | -78.97% | -0.21% | 170% | 3.45% | 300% | 72.47% | -272.68% | - |
| EBITDA | 268M | 136M | 290M | 519M | 393M | 454M | 886M | 895M | 640M | 669M | 526M | 284M | 970M |
| EBITDA Margin % | 8.89% | 4.47% | 8.64% | 13.94% | 10.19% | 10.97% | 21.28% | 20.04% | 11.87% | 11.11% | 8.21% | 4.26% | 13.98% |
| EBITDA Growth % | 12.13% | -53.1% | -44.12% | 32.06% | -13.44% | -48.76% | -1.01% | 39.84% | -4.33% | 27.19% | 85.21% | -70.72% | - |
| D&A (Non-Cash Add-back) | 193M | 194M | 125M | 150M | 230M | 352M | 401M | 409M | 460M | 495M | 613M | 600M | 787M |
| EBIT | -59M | -112M | -49M | 90M | -43M | 30M | 23M | 31M | -283M | 178M | -1.19B | -505M | 128M |
| Net Interest Income | -48M | -41M | -75M | -93M | -77M | -54M | -60M | -78M | -112M | -137M | -40M | -69M | -118M |
| Interest Income | 0 | 7M | 0 | 18M | 7M | 1M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 48M | 48M | 75M | 111M | 84M | 55M | 60M | 78M | 112M | 137M | 40M | 69M | 118M |
| Other Income/Expense | -206M | -102M | 339M | -701M | -290M | -127M | -624M | -2.25B | -575M | -193M | -1.14B | -258M | -423M |
| Pretax Income | -131M | -160M | 504M | -332M | -127M | -25M | -139M | -1.76B | -395M | -16M | -1.23B | -574M | 10M |
| Pretax Margin % | -4.35% | -5.26% | 15.02% | -8.92% | -3.29% | -0.6% | -3.34% | -39.44% | -7.32% | -0.27% | -19.15% | -8.62% | 0.14% |
| Income Tax | 21M | 10M | 78M | -36M | 55M | 3M | -21M | 172M | 21M | -193M | -244M | -238M | -24M |
| Effective Tax Rate % | -16.03% | -6.25% | 15.48% | 10.84% | -43.31% | -12% | 15.11% | -9.76% | -5.32% | 1206.25% | 19.89% | 41.46% | -240% |
| Net Income | -152M | -170M | 426M | -296M | -182M | -28M | -118M | -1.93B | -416M | 181M | -983M | -414M | -81M |
| Net Margin % | -5.04% | -5.59% | 12.69% | -7.95% | -4.72% | -0.68% | -2.83% | -43.3% | -7.71% | 3.01% | -15.34% | -6.21% | -1.17% |
| Net Income Growth % | -155.07% | -139.91% | 243.92% | -62.64% | -550% | 76.27% | 93.9% | -364.9% | -329.83% | 118.41% | -137.44% | -411.11% | - |
| Net Income (Continuing) | -152M | -170M | 426M | -296M | -182M | -28M | -118M | -1.93B | -416M | 177M | -983M | -336M | 34M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 4M | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 4M | 4M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -0.99 | -1.14 | 2.23 | -1.41 | -0.89 | -0.18 | -0.56 | -9.24 | -2.02 | 0.83 | -4.85 | -2.04 | -0.40 |
| EPS Growth % | -173.91% | -151.12% | 258.16% | -58.43% | -394.44% | 67.86% | 93.94% | -357.43% | -343.37% | 117.11% | -137.75% | -410% | - |
| EPS (Basic) | - | -1.14 | 2.28 | -1.41 | -0.89 | -0.18 | -0.56 | -9.24 | -2.02 | 0.84 | -4.85 | -2.04 | -0.40 |
| Diluted Shares Outstanding | 153.8M | 158.42M | 191.13M | 216.78M | 215.89M | 212.72M | 210.02M | 209.32M | 206.06M | 218.07M | 202.68M | 202.63M | 202.63M |
| Basic Shares Outstanding | 140.99M | 149.12M | 182.51M | 216.78M | 215.89M | 212.72M | 210.02M | 209.32M | 206.06M | 204M | 202.68M | 202.63M | 202.63M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | - | - |
Persistent revenue contraction
As reported in recent financial filings, Conduent's revenue has experienced a consistent downward trajectory, culminating in a 3.7% year-over-year decline to $723 million in 2026Q1, reflecting the ongoing challenges of balancing portfolio divestitures against the difficulty of securing new, high-value government and transportation contracts.
The persistent revenue decay suggests that the company's 'leaky bucket' of expiring legacy contracts is currently outpacing its ability to capture new business. Investors should monitor whether this contraction is a deliberate strategic pruning of low-margin commercial work or a broader loss of competitive relevance in its core government services niche.
Based on the company's latest income statement data, gross margins have compressed significantly to 12.3% in 2026Q1, down from the 22.4% levels observed in late 2023, indicating that the firm is struggling to maintain pricing power amidst rising labor costs and operational inefficiencies.
The erosion of gross margins appears to confirm that the company's labor-intensive service model is highly sensitive to wage inflation and lacks the automated scale required to protect profitability. This trend warrants further investigation into whether the current cost structure can be stabilized without a fundamental shift toward higher-margin, technology-led service delivery.
According to the provided quarterly data, Conduent's operating margin has deteriorated into negative territory at -0.4% in 2026Q1, demonstrating that the company is currently unable to achieve the necessary operating leverage to offset its shrinking revenue base and fixed administrative overhead.
The inability to scale operating income suggests that the company's cost-cutting initiatives have not yet kept pace with the decline in top-line performance. This negative operating leverage implies that any further revenue weakness may lead to disproportionate impacts on the bottom line, increasing the urgency for a more aggressive restructuring of the firm's operating expense profile.
As evidenced by the erratic net income swings, including a $216 million profit in 2024Q2 followed by a $33 million loss in 2026Q1, the company's bottom-line performance appears heavily influenced by non-operating items and divestiture-related accounting rather than core operational profitability.
The significant variance in net income suggests that investors should exercise caution when evaluating EPS, as these figures may be distorted by one-time gains or charges associated with the ongoing portfolio transformation. The lack of consistent, positive net income indicates that the underlying business model is currently failing to generate sustainable shareholder value.
Quick answers to the most common questions about buying CNDT stock.
For fiscal year 2025, Conduent Incorporated (CNDT) reported total revenue of $3.04B. This represents a 56.2% decline compared to $6.94B in 2014.
Conduent Incorporated (CNDT) reported a net loss of $170.0M for the fiscal year ending 2025.
Conduent Incorporated (CNDT) reported an operating income of $-58.0M, resulting in an operating profit margin of -1.9%. This margin reflects the operational efficiency of the business before interest and taxes.
Conduent Incorporated (CNDT) generated $552.0M in gross profit for the year, representing a gross profit margin of 18.1%. This demonstrates the company's core pricing power and production efficiency.