x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
New York | 16-0468020 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |
P.O. Box 4505, 201 Merritt 7 Norwalk, Connecticut | 06851-1056 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | x | Accelerated filer | o | Non-accelerated filer (Do not check if smaller reporting company) | o | Smaller reporting company | o | Emerging growth company | o |
Class | Outstanding at June 30, 2018 | |
Common Stock, $1 par value | 255,101,733 shares |
Page | ||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in millions, except per-share data) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Revenues | ||||||||||||||||
Sales | $ | 1,017 | $ | 1,010 | $ | 1,950 | $ | 1,946 | ||||||||
Services, maintenance and rentals | 1,425 | 1,483 | 2,856 | 2,925 | ||||||||||||
Financing | 68 | 74 | 139 | 150 | ||||||||||||
Total Revenues | 2,510 | 2,567 | 4,945 | 5,021 | ||||||||||||
Costs and Expenses | ||||||||||||||||
Cost of sales | 622 | 619 | 1,185 | 1,184 | ||||||||||||
Cost of services, maintenance and rentals | 854 | 872 | 1,722 | 1,753 | ||||||||||||
Cost of financing | 33 | 33 | 67 | 66 | ||||||||||||
Research, development and engineering expenses | 101 | 102 | 201 | 213 | ||||||||||||
Selling, administrative and general expenses | 624 | 626 | 1,252 | 1,260 | ||||||||||||
Restructuring and related costs | 34 | 39 | 62 | 157 | ||||||||||||
Amortization of intangible assets | 12 | 15 | 24 | 29 | ||||||||||||
Transaction and related costs, net | 58 | — | 96 | — | ||||||||||||
Other expenses, net | 39 | 68 | 69 | 182 | ||||||||||||
Total Costs and Expenses | 2,377 | 2,374 | 4,678 | 4,844 | ||||||||||||
Income before Income Taxes and Equity Income | 133 | 193 | 267 | 177 | ||||||||||||
Income tax expense | 38 | 43 | 78 | 19 | ||||||||||||
Equity in net income (loss) of unconsolidated affiliates | 19 | 20 | (49 | ) | 60 | |||||||||||
Income from Continuing Operations | 114 | 170 | 140 | 218 | ||||||||||||
Loss from discontinued operations, net of tax | — | — | — | (6 | ) | |||||||||||
Net Income | 114 | 170 | 140 | 212 | ||||||||||||
Less: Net income attributable to noncontrolling interests | 2 | 4 | 5 | 6 | ||||||||||||
Net Income Attributable to Xerox | $ | 112 | $ | 166 | $ | 135 | $ | 206 | ||||||||
Amounts Attributable to Xerox | ||||||||||||||||
Net income from continuing operations | $ | 112 | $ | 166 | $ | 135 | $ | 212 | ||||||||
Net loss from discontinued operations | — | — | — | (6 | ) | |||||||||||
Net Income Attributable to Xerox | $ | 112 | $ | 166 | $ | 135 | $ | 206 | ||||||||
Basic Earnings (Loss) per Share | ||||||||||||||||
Continuing operations | $ | 0.42 | $ | 0.64 | $ | 0.50 | $ | 0.81 | ||||||||
Discontinued operations | — | — | — | (0.03 | ) | |||||||||||
Total Basic Earnings per Share | $ | 0.42 | $ | 0.64 | $ | 0.50 | $ | 0.78 | ||||||||
Diluted Earnings (Loss) per Share | ||||||||||||||||
Continuing operations | $ | 0.42 | $ | 0.63 | $ | 0.50 | $ | 0.80 | ||||||||
Discontinued operations | — | — | — | (0.02 | ) | |||||||||||
Total Diluted Earnings per Share | $ | 0.42 | $ | 0.63 | $ | 0.50 | $ | 0.78 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net Income | $ | 114 | $ | 170 | $ | 140 | $ | 212 | ||||||||
Less: Net income attributable to noncontrolling interests | 2 | 4 | 5 | 6 | ||||||||||||
Net Income Attributable to Xerox | 112 | 166 | 135 | 206 | ||||||||||||
Other Comprehensive (Loss) Income, Net(1) | ||||||||||||||||
Translation adjustments, net | (322 | ) | 204 | (146 | ) | 337 | ||||||||||
Unrealized (losses) gains, net | (3 | ) | (14 | ) | 14 | (6 | ) | |||||||||
Changes in defined benefit plans, net | 90 | (29 | ) | 108 | (3 | ) | ||||||||||
Other Comprehensive (Loss) Income, Net | (235 | ) | 161 | (24 | ) | 328 | ||||||||||
Less: Other comprehensive income, net attributable to noncontrolling interests | — | — | — | 1 | ||||||||||||
Other Comprehensive (Loss) Income, Net Attributable to Xerox | (235 | ) | 161 | (24 | ) | 327 | ||||||||||
Comprehensive (Loss) Income, Net | (121 | ) | 331 | 116 | 540 | |||||||||||
Less: Comprehensive income, net attributable to noncontrolling interests | 2 | 4 | 5 | 7 | ||||||||||||
Comprehensive (Loss) Income, Net Attributable to Xerox | $ | (123 | ) | $ | 327 | $ | 111 | $ | 533 |
(in millions, except share data in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Assets | ||||||||
Cash and cash equivalents | $ | 1,263 | $ | 1,293 | ||||
Accounts receivable, net | 1,297 | 1,357 | ||||||
Billed portion of finance receivables, net | 100 | 112 | ||||||
Finance receivables, net | 1,240 | 1,317 | ||||||
Inventories | 947 | 915 | ||||||
Other current assets | 233 | 236 | ||||||
Total current assets | 5,080 | 5,230 | ||||||
Finance receivables due after one year, net | 2,183 | 2,323 | ||||||
Equipment on operating leases, net | 438 | 454 | ||||||
Land, buildings and equipment, net | 564 | 629 | ||||||
Investments in affiliates, at equity | 1,344 | 1,404 | ||||||
Intangible assets, net | 244 | 268 | ||||||
Goodwill | 3,897 | 3,930 | ||||||
Deferred tax assets | 917 | 1,026 | ||||||
Other long-term assets | 889 | 682 | ||||||
Total Assets | $ | 15,556 | $ | 15,946 | ||||
Liabilities and Equity | ||||||||
Short-term debt and current portion of long-term debt | $ | 412 | $ | 282 | ||||
Accounts payable | 1,153 | 1,108 | ||||||
Accrued compensation and benefits costs | 357 | 444 | ||||||
Accrued expenses and other current liabilities | 832 | 907 | ||||||
Total current liabilities | 2,754 | 2,741 | ||||||
Long-term debt | 4,813 | 5,235 | ||||||
Pension and other benefit liabilities | 1,502 | 1,595 | ||||||
Post-retirement medical benefits | 650 | 662 | ||||||
Other long-term liabilities | 215 | 206 | ||||||
Total Liabilities | 9,934 | 10,439 | ||||||
Commitments and Contingencies (See Note 18) | ||||||||
Convertible Preferred Stock | 214 | 214 | ||||||
Common stock | 255 | 255 | ||||||
Additional paid-in capital | 3,920 | 3,893 | ||||||
Retained earnings | 4,974 | 4,856 | ||||||
Accumulated other comprehensive loss | (3,772 | ) | (3,748 | ) | ||||
Xerox shareholders’ equity | 5,377 | 5,256 | ||||||
Noncontrolling interests | 31 | 37 | ||||||
Total Equity | 5,408 | 5,293 | ||||||
Total Liabilities and Equity | $ | 15,556 | $ | 15,946 | ||||
Shares of common stock issued and outstanding | 255,102 | 254,613 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Cash Flows from Operating Activities | ||||||||||||||||
Net income | $ | 114 | $ | 170 | $ | 140 | $ | 212 | ||||||||
Loss from discontinued operations, net of tax | — | — | — | 6 | ||||||||||||
Income from continuing operations | 114 | 170 | 140 | 218 | ||||||||||||
Adjustments required to reconcile Net income to Cash flows from operating activities | ||||||||||||||||
Depreciation and amortization | 139 | 135 | 278 | 268 | ||||||||||||
Provisions | 23 | 17 | 40 | 35 | ||||||||||||
Net gain on sales of businesses and assets | (16 | ) | (1 | ) | (32 | ) | (1 | ) | ||||||||
Undistributed equity in net income of unconsolidated affiliates | (16 | ) | 10 | 52 | (30 | ) | ||||||||||
Stock-based compensation | 13 | 12 | 29 | 25 | ||||||||||||
Restructuring and asset impairment charges | 34 | 32 | 62 | 140 | ||||||||||||
Payments for restructurings | (37 | ) | (66 | ) | (91 | ) | (124 | ) | ||||||||
Defined benefit pension cost | 26 | 37 | 53 | 99 | ||||||||||||
Contributions to defined benefit pension plans | (37 | ) | (23 | ) | (75 | ) | (46 | ) | ||||||||
(Increase) decrease in accounts receivable and billed portion of finance receivables | (10 | ) | (63 | ) | 36 | (140 | ) | |||||||||
Decrease (increase) in inventories | 16 | (30 | ) | (71 | ) | (88 | ) | |||||||||
Increase in equipment on operating leases | (63 | ) | (50 | ) | (119 | ) | (102 | ) | ||||||||
Decrease in finance receivables | 57 | 69 | 142 | 134 | ||||||||||||
Decrease (increase) in other current and long-term assets | 37 | 14 | 19 | (43 | ) | |||||||||||
Decrease in accounts payable and accrued compensation | (70 | ) | (21 | ) | (58 | ) | — | |||||||||
Decrease in other current and long-term liabilities | (5 | ) | (6 | ) | (4 | ) | (7 | ) | ||||||||
Net change in income tax assets and liabilities | 28 | 5 | 41 | (36 | ) | |||||||||||
Net change in derivative assets and liabilities | (17 | ) | 44 | (23 | ) | 99 | ||||||||||
Other operating, net | 19 | (4 | ) | 32 | 12 | |||||||||||
Net cash provided by operating activities of continuing operations | 235 | 281 | 451 | 413 | ||||||||||||
Net cash used in operating activities of discontinued operations | — | (15 | ) | — | (95 | ) | ||||||||||
Net cash provided by operating activities | 235 | 266 | 451 | 318 | ||||||||||||
Cash Flows from Investing Activities | ||||||||||||||||
Cost of additions to land, buildings, equipment and software | (32 | ) | (21 | ) | (50 | ) | (47 | ) | ||||||||
Proceeds from sales of land, buildings and equipment | 16 | — | 32 | 1 | ||||||||||||
Acquisitions, net of cash acquired | — | (65 | ) | — | (76 | ) | ||||||||||
Collections of deferred proceeds from sales of receivables | — | 51 | — | 99 | ||||||||||||
Collections on beneficial interest from sales of finance receivables | — | 5 | — | 11 | ||||||||||||
Other investing, net | 1 | — | 1 | (29 | ) | |||||||||||
Net cash used in investing activities | (15 | ) | (30 | ) | (17 | ) | (41 | ) | ||||||||
Cash Flows from Financing Activities | ||||||||||||||||
Net (payments) proceeds on short-term debt | — | — | (1 | ) | 1 | |||||||||||
Proceeds from issuance of long-term debt | 3 | 2 | 5 | 5 | ||||||||||||
Payments on long-term debt | (272 | ) | (2 | ) | (310 | ) | (1,330 | ) | ||||||||
Dividends | (68 | ) | (68 | ) | (135 | ) | (155 | ) | ||||||||
Other financing, net | (2 | ) | (12 | ) | (15 | ) | 141 | |||||||||
Net cash used in financing activities | (339 | ) | (80 | ) | (456 | ) | (1,338 | ) | ||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (28 | ) | 27 | (19 | ) | 36 | ||||||||||
(Decrease) increase in cash, cash equivalents and restricted cash | (147 | ) | 183 | (41 | ) | (1,025 | ) | |||||||||
Cash, cash equivalents and restricted cash at beginning of period | 1,474 | 1,194 | 1,368 | 2,402 | ||||||||||||
Cash, Cash Equivalents and Restricted Cash at End of Period | $ | 1,327 | $ | 1,377 | $ | 1,327 | $ | 1,377 |
As of June 30, 2018 | ||||||||||||
Superseded Revenue Guidance(1) | Adjustments | As Reported | ||||||||||
Deferred tax assets | $ | 950 | $ | (33 | ) | $ | 917 | |||||
Other long-term assets | 747 | 142 | 889 | |||||||||
Retained earnings | 4,865 | 109 | 4,974 |
(1) | Reflects balance of account under revenue recognition guidance superseded by ASC Topic 606. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Primary geographical markets(1): | ||||||||||||||||
United States | $ | 1,479 | $ | 1,533 | $ | 2,893 | $ | 3,002 | ||||||||
Europe | 660 | 674 | 1,336 | 1,314 | ||||||||||||
Canada | 147 | 150 | 291 | 295 | ||||||||||||
Other | 224 | 210 | 425 | 410 | ||||||||||||
Total Revenues | $ | 2,510 | $ | 2,567 | $ | 4,945 | $ | 5,021 | ||||||||
Major product and services lines: | ||||||||||||||||
Equipment(2) | $ | 561 | $ | 547 | $ | 1,060 | $ | 1,049 | ||||||||
Supplies, paper and other sales | 456 | 463 | 890 | 897 | ||||||||||||
Maintenance agreements(3) | 634 | 662 | 1,267 | 1,301 | ||||||||||||
Service arrangements(4) | 614 | 634 | 1,237 | 1,258 | ||||||||||||
Rental and other | 177 | 187 | 352 | 366 | ||||||||||||
Financing | 68 | 74 | 139 | 150 | ||||||||||||
Total Revenues | $ | 2,510 | $ | 2,567 | $ | 4,945 | $ | 5,021 | ||||||||
Sales channels: | ||||||||||||||||
Direct equipment lease(5) | $ | 172 | $ | 163 | $ | 332 | $ | 323 | ||||||||
Distributors & resellers(6) | 370 | 372 | 701 | 693 | ||||||||||||
Customer direct | 475 | 475 | 917 | 930 | ||||||||||||
Total Sales | $ | 1,017 | $ | 1,010 | $ | 1,950 | $ | 1,946 |
(1) | Geographic area data is based upon the location of the subsidiary reporting the revenue. |
(2) | For the three and six months ended June 30, 2017, Equipment sale revenues exclude $9 and $20, respectively, of equipment-related training revenue, which was classified as Services under previous revenue guidance - see "Adoption Summary" above. |
(3) | Includes revenues from maintenance agreements on sold equipment as well as revenues associated with service agreements sold in our small and mid-sized business (SMB) focused channels and through our channel partners as Xerox Partner Print Services (XPPS). |
(4) | Primarily includes revenues from our Managed Document Services (MDS) offerings. Also includes revenues from embedded operating leases, which were not significant. |
(5) | Primarily reflects direct sales through bundled lease arrangements. |
(6) | Primarily reflects sales through our two-tier distribution channels. |
Three Months Ended June 30, 2017 | ||||||||||||
As Reported | Adjustment | As Recasted | ||||||||||
Cost of sales | $ | 619 | $ | — | $ | 619 | ||||||
Cost of services, maintenance and rentals | 884 | (12 | ) | 872 | ||||||||
Research, development and engineering expenses | 106 | (4 | ) | 102 | ||||||||
Selling, administrative and general expenses | 643 | (17 | ) | 626 | ||||||||
Restructuring and related costs | 40 | (1 | ) | 39 | ||||||||
Other expenses, net | 34 | 34 | 68 |
Six Months Ended June 30, 2017 | ||||||||||||
As Reported | Adjustment | As Recasted | ||||||||||
Cost of sales | $ | 1,186 | $ | (2 | ) | $ | 1,184 | |||||
Cost of services, maintenance and rentals | 1,784 | (31 | ) | 1,753 | ||||||||
Research, development and engineering expenses | 224 | (11 | ) | 213 | ||||||||
Selling, administrative and general expenses | 1,307 | (47 | ) | 1,260 | ||||||||
Restructuring and related costs | 160 | (3 | ) | 157 | ||||||||
Other expenses, net | 88 | 94 | 182 |
• | Investments - Debt Securities and Regulated Operations: ASU 2018-04, (Topics 320 and 980) Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273 (SEC Update). |
• | Service Concession Arrangements: ASU 2017-10, (Topic 853) Determining the Customer of the Operation Services (a consensus of the FASB Emerging Issues Task Force). This update is effective for our fiscal year beginning January 1, 2018. |
• | Compensation - Stock Compensation: ASU 2017-09, (Topic 718) Scope of Modification Accounting. This update is effective for our fiscal year beginning January 1, 2018. |
• | Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets: ASU 2017-05, (Subtopic 610-20) Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. This update is effective for our fiscal year beginning January 1, 2018. |
• | Financial Instruments - Classification and Measurement: ASU 2016-01, Financial Instruments - Recognition and Measurement of Financial Instruments and Financial Liabilities. This update is effective for our fiscal year beginning January 1, 2018. |
Six Months Ended June 30, 2017 | ||||
Loss from operations | $ | 8 | ||
Loss on disposal | — | |||
Net loss before income taxes | (8 | ) | ||
Income tax benefit | 2 | |||
Loss from discontinued operations, net of tax | $ | (6 | ) |
June 30, 2018 | December 31, 2017 | |||||||
Cash and cash equivalents | $ | 1,263 | $ | 1,293 | ||||
Restricted cash | ||||||||
Tax and labor litigation deposits in Brazil | 62 | 72 | ||||||
Other restricted cash | 2 | 3 | ||||||
Total Restricted cash | 64 | 75 | ||||||
Cash, cash equivalents and restricted cash | $ | 1,327 | $ | 1,368 |
June 30, 2018 | December 31, 2017 | |||||||
Other current assets | $ | 1 | $ | 1 | ||||
Other long-term assets | 63 | 74 | ||||||
Total Restricted cash | $ | 64 | $ | 75 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Provision for receivables | $ | 13 | $ | 10 | $ | 26 | $ | 23 | ||||||||
Provision for inventory | 10 | 7 | 14 | 12 | ||||||||||||
Provision for product warranty | 3 | 3 | 7 | 7 | ||||||||||||
Depreciation of buildings and equipment | 44 | 34 | 88 | 68 | ||||||||||||
Depreciation and obsolescence of equipment on operating leases | 63 | 68 | 127 | 135 | ||||||||||||
Amortization of internal use software | 19 | 16 | 37 | 31 | ||||||||||||
Amortization of product software | — | 1 | — | 3 | ||||||||||||
Amortization of acquired intangible assets | 12 | 15 | 24 | 29 | ||||||||||||
Amortization of customer contract costs(1) | 25 | 1 | 50 | 2 | ||||||||||||
Cost of additions to land, buildings and equipment | 17 | 13 | 26 | 30 | ||||||||||||
Cost of additions to internal use software | 15 | 8 | 24 | 17 | ||||||||||||
Common stock dividends | 64 | 64 | 128 | 145 | ||||||||||||
Preferred stock dividends | 4 | 4 | 7 | 10 | ||||||||||||
Payments to noncontrolling interests | 1 | 11 | 13 | 12 |
(1) | Amortization of $24 and $48 for the three and six months ended June 30, 2018, respectively, is related to the cost of obtaining a contract and is reported in Decrease (increase) in other current and long-term assets. Refer to Note 2 - Adoption of New Revenue Recognition Standard - Contract Costs for additional information. |
June 30, 2018 | December 31, 2017 | |||||||
Invoiced | $ | 1,001 | $ | 1,048 | ||||
Accrued | 353 | 368 | ||||||
Allowance for doubtful accounts | (57 | ) | (59 | ) | ||||
Accounts receivable, net | $ | 1,297 | $ | 1,357 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Accounts receivable sales(1) | $ | 128 | $ | 567 | $ | 231 | $ | 1,078 | |||||||
Deferred proceeds | — | 56 | — | 108 | |||||||||||
Loss on sales of accounts receivable | — | 3 | 1 | 6 | |||||||||||
Estimated increase (decrease) to operating cash flows(2) | 26 | 54 | (25 | ) | (11 | ) |
(1) | Customers may also enter into structured-payable arrangements that require us to sell our receivables from that customer to a third-party financial institution, which then makes payments to us to settle the customer's receivable. In these instances, we ensure the sale of the receivables are bankruptcy remote and the payment made to us is without recourse. The activity associated with these arrangements is not reflected in this disclosure as payments under these arrangements have not been material and these are customer directed arrangements. |
(2) | Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency. |
Allowance for Credit Losses: | United States | Canada | Europe | Other(1) | Total | |||||||||||||||
Balance at December 31, 2017 | $ | 56 | $ | 15 | $ | 35 | $ | 2 | $ | 108 | ||||||||||
Provision | 5 | — | 4 | — | 9 | |||||||||||||||
Charge-offs | (5 | ) | (1 | ) | (4 | ) | — | (10 | ) | |||||||||||
Recoveries and other(2) | — | — | 1 | — | 1 | |||||||||||||||
Balance at March 31, 2018 | $ | 56 | $ | 14 | $ | 36 | $ | 2 | $ | 108 | ||||||||||
Provision | 4 | 1 | 4 | — | 9 | |||||||||||||||
Charge-offs | (4 | ) | (1 | ) | (3 | ) | — | (8 | ) | |||||||||||
Recoveries and other(2) | — | — | (2 | ) | — | (2 | ) | |||||||||||||
Balance at June 30, 2018 | $ | 56 | $ | 14 | $ | 35 | $ | 2 | $ | 107 | ||||||||||
Finance receivables as of June 30, 2018 collectively evaluated for impairment (3) | $ | 1,962 | $ | 356 | $ | 1,256 | $ | 56 | $ | 3,630 | ||||||||||
Balance at December 31, 2016 | $ | 55 | $ | 16 | $ | 37 | $ | 2 | $ | 110 | ||||||||||
Provision | 4 | — | 5 | — | 9 | |||||||||||||||
Charge-offs | (6 | ) | (2 | ) | (2 | ) | — | (10 | ) | |||||||||||
Recoveries and other(2) | — | 2 | — | — | 2 | |||||||||||||||
Balance at March 31, 2017 | $ | 53 | $ | 16 | $ | 40 | $ | 2 | $ | 111 | ||||||||||
Provision | 4 | 1 | 1 | — | 6 | |||||||||||||||
Charge-offs | (10 | ) | (1 | ) | (3 | ) | — | (14 | ) | |||||||||||
Recoveries and other(2) | 1 | — | 4 | — | 5 | |||||||||||||||
Balance at June 30, 2017 | $ | 48 | $ | 16 | $ | 42 | $ | 2 | $ | 108 | ||||||||||
Finance receivables as of June 30, 2017 collectively evaluated for impairment(3) | $ | 2,028 | $ | 383 | $ | 1,336 | $ | 64 | $ | 3,811 |
(1) | Includes developing market countries and smaller units. |
(2) | Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations. |
(3) | Total Finance receivables exclude the allowance for credit losses of $107 and $108 at June 30, 2018 and 2017, respectively. |
• | Investment grade: This rating includes accounts with excellent to good business credit, asset quality and capacity to meet financial obligations. These customers are less susceptible to adverse effects due to shifts in economic conditions or changes in circumstance. The rating generally equates to a Standard & Poor's (S&P) rating of BBB- or better. Loss rates in this category are normally less than 1%. |
• | Non-investment grade: This rating includes accounts with average credit risk that are more susceptible to loss in the event of adverse business or economic conditions. This rating generally equates to a BB S&P rating. Although we experience higher loss rates associated with this customer class, we believe the risk is somewhat mitigated by the fact that our leases are fairly well dispersed across a large and diverse customer base. In addition, the higher loss rates are largely offset by the higher rates of return we obtain with such leases. Loss rates in this category are generally in the range of 2% to 5%. |
• | Substandard: This rating includes accounts that have marginal credit risk such that the customer’s ability to make repayment is impaired or may likely become impaired. We use numerous strategies to mitigate risk including higher rates of interest, prepayments, personal guarantees, etc. Accounts in this category include customers who were downgraded during the term of the lease from investment and non-investment grade evaluation when the lease was originated. Accordingly, there is a distinct possibility for a loss of principal and interest or customer default. The loss rates in this category are generally in the range of 7% to 10%. |
June 30, 2018 | December 31, 2017 | ||||||||||||||||||||||||||||||
Investment Grade | Non-investment Grade | Substandard | Total Finance Receivables | Investment Grade | Non-investment Grade | Substandard | Total Finance Receivables | ||||||||||||||||||||||||
Finance and other services | $ | 184 | $ | 331 | $ | 85 | $ | 600 | $ | 199 | $ | 345 | $ | 75 | $ | 619 | |||||||||||||||
Government and education | 459 | 65 | 7 | 531 | 490 | 61 | 6 | 557 | |||||||||||||||||||||||
Graphic arts | 86 | 133 | 96 | 315 | 84 | 97 | 141 | 322 | |||||||||||||||||||||||
Industrial | 80 | 81 | 16 | 177 | 82 | 84 | 14 | 180 | |||||||||||||||||||||||
Healthcare | 82 | 51 | 9 | 142 | 88 | 48 | 9 | 145 | |||||||||||||||||||||||
Other | 61 | 93 | 43 | 197 | 68 | 98 | 40 | 206 | |||||||||||||||||||||||
Total United States | 952 | 754 | 256 | 1,962 | 1,011 | 733 | 285 | 2,029 | |||||||||||||||||||||||
Finance and other services | 51 | 37 | 24 | 112 | 54 | 42 | 27 | 123 | |||||||||||||||||||||||
Government and education | 42 | 4 | 4 | 50 | 48 | 5 | 5 | 58 | |||||||||||||||||||||||
Graphic arts | 28 | 30 | 27 | 85 | 34 | 35 | 27 | 96 | |||||||||||||||||||||||
Industrial | 18 | 11 | 10 | 39 | 20 | 12 | 11 | 43 | |||||||||||||||||||||||
Other | 33 | 23 | 14 | 70 | 36 | 25 | 16 | 77 | |||||||||||||||||||||||
Total Canada | 172 | 105 | 79 | 356 | 192 | 119 | 86 | 397 | |||||||||||||||||||||||
France | 227 | 193 | 21 | 441 | 234 | 226 | 22 | 482 | |||||||||||||||||||||||
U.K./Ireland | 101 | 127 | 11 | 239 | 106 | 150 | 10 | 266 | |||||||||||||||||||||||
Central(1) | 187 | 128 | 13 | 328 | 189 | 149 | 16 | 354 | |||||||||||||||||||||||
Southern(2) | 46 | 144 | 13 | 203 | 52 | 144 | 13 | 209 | |||||||||||||||||||||||
Nordics(3) | 26 | 18 | 1 | 45 | 29 | 21 | 1 | 51 | |||||||||||||||||||||||
Total Europe | 587 | 610 | 59 | 1,256 | 610 | 690 | 62 | 1,362 | |||||||||||||||||||||||
Other | 34 | 20 | 2 | 56 | 38 | 28 | 6 | 72 | |||||||||||||||||||||||
Total | $ | 1,745 | $ | 1,489 | $ | 396 | $ | 3,630 | $ | 1,851 | $ | 1,570 | $ | 439 | $ | 3,860 |
(1) | Switzerland, Germany, Austria, Belgium and Holland. |
(2) | Italy, Greece, Spain and Portugal. |
(3) | Sweden, Norway, Denmark and Finland. |
June 30, 2018 | |||||||||||||||||||||||||||
Current | 31-90 Days Past Due | >90 Days Past Due | Total Billed | Unbilled | Total Finance Receivables | >90 Days and Accruing | |||||||||||||||||||||
Finance and other services | $ | 14 | $ | 3 | $ | 2 | $ | 19 | $ | 581 | $ | 600 | $ | 10 | |||||||||||||
Government and education | 16 | 3 | 2 | 21 | 510 | 531 | 22 | ||||||||||||||||||||
Graphic arts | 11 | 1 | — | 12 | 303 | 315 | 4 | ||||||||||||||||||||
Industrial | 5 | 1 | 1 | 7 | 170 | 177 | 4 | ||||||||||||||||||||
Healthcare | 4 | 1 | 1 | 6 | 136 | 142 | 5 | ||||||||||||||||||||
Other | 6 | 1 | 1 | 8 | 189 | 197 | 5 | ||||||||||||||||||||
Total United States | 56 | 10 | 7 | 73 | 1,889 | 1,962 | 50 | ||||||||||||||||||||
Canada | 7 | 2 | 1 | 10 | 346 | 356 | 20 | ||||||||||||||||||||
France | 7 | — | — | 7 | 434 | 441 | 17 | ||||||||||||||||||||
U.K./Ireland | 1 | 1 | — | 2 | 237 | 239 | — | ||||||||||||||||||||
Central(1) | 1 | 1 | 1 | 3 | 325 | 328 | 8 | ||||||||||||||||||||
Southern(2) | 3 | 1 | 1 | 5 | 198 | 203 | 6 | ||||||||||||||||||||
Nordics(3) | — | — | — | — | 45 | 45 | — | ||||||||||||||||||||
Total Europe | 12 | 3 | 2 | 17 | 1,239 | 1,256 | 31 | ||||||||||||||||||||
Other | 3 | — | — | 3 | 53 | 56 | — | ||||||||||||||||||||
Total | $ | 78 | $ | 15 | $ | 10 | $ | 103 | $ | 3,527 | $ | 3,630 | $ | 101 | |||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||
Current | 31-90 Days Past Due | >90 Days Past Due | Total Billed | Unbilled | Total Finance Receivables | >90 Days and Accruing | |||||||||||||||||||||
Finance and other services | $ | 18 | $ | 3 | $ | 1 | $ | 22 | $ | 597 | $ | 619 | $ | 12 | |||||||||||||
Government and education | 18 | 3 | 3 | 24 | 533 | 557 | 21 | ||||||||||||||||||||
Graphic arts | 12 | 1 | — | 13 | 309 | 322 | 6 | ||||||||||||||||||||
Industrial | 6 | 1 | 1 | 8 | 172 | 180 | 4 | ||||||||||||||||||||
Healthcare | 5 | 1 | 1 | 7 | 138 | 145 | 5 | ||||||||||||||||||||
Other | 7 | 1 | 1 | 9 | 197 | 206 | 3 | ||||||||||||||||||||
Total United States | 66 | 10 | 7 | 83 | 1,946 | 2,029 | 51 | ||||||||||||||||||||
Canada | 8 | 2 | 1 | 11 | 386 | 397 | 17 | ||||||||||||||||||||
France | 6 | — | — | 6 | 476 | 482 | 22 | ||||||||||||||||||||
U.K./Ireland | 3 | — | — | 3 | 263 | 266 | — | ||||||||||||||||||||
Central(1) | 1 | 2 | — | 3 | 351 | 354 | 6 | ||||||||||||||||||||
Southern(2) | 4 | 1 | 1 | 6 | 203 | 209 | 6 | ||||||||||||||||||||
Nordics(3) | — | — | — | — | 51 | 51 | — | ||||||||||||||||||||
Total Europe | 14 | 3 | 1 | 18 | 1,344 | 1,362 | 34 | ||||||||||||||||||||
Other | 3 | — | — | 3 | 69 | 72 | — | ||||||||||||||||||||
Total | $ | 91 | $ | 15 | $ | 9 | $ | 115 | $ | 3,745 | $ | 3,860 | $ | 102 |
June 30, 2018 | December 31, 2017 | ||||||
Finished goods | $ | 803 | $ | 777 | |||
Work-in-process | 52 | 49 | |||||
Raw materials | 92 | 89 | |||||
Total Inventories | $ | 947 | $ | 915 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Fuji Xerox | $ | 17 | $ | 18 | $ | (53 | ) | $ | 55 | ||||||
Other | 2 | 2 | 4 | 5 | |||||||||||
Total Equity in net income (loss) of unconsolidated affiliates | $ | 19 | $ | 20 | $ | (49 | ) | $ | 60 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Summary of Operations | |||||||||||||||
Revenues | $ | 2,226 | $ | 2,325 | $ | 4,691 | $ | 4,884 | |||||||
Costs and expenses | 2,098 | 2,191 | 4,869 | 4,543 | |||||||||||
Income (Loss) before Income Taxes | 128 | 134 | (178 | ) | 341 | ||||||||||
Income tax expense | 50 | 32 | 11 | 76 | |||||||||||
Net Income (Loss) | 78 | 102 | (189 | ) | 265 | ||||||||||
Less: Net income attributable to noncontrolling interests | 1 | 1 | 1 | 2 | |||||||||||
Net Income (Loss) – Fuji Xerox | $ | 77 | $ | 101 | $ | (190 | ) | $ | 263 | ||||||
Weighted Average Exchange Rate(1) | 109.05 | 111.01 | 108.54 | 112.42 |
(1) | Represents Yen/U.S. Dollar exchange rate used to translate. |
Severance and Related Costs | Lease Cancellation and Other Costs | Asset Impairments(2) | Total | ||||||||||||
Balance at December 31, 2017 | $ | 108 | $ | 1 | $ | — | $ | 109 | |||||||
Provision | 24 | 12 | — | 36 | |||||||||||
Reversals | (8 | ) | — | — | (8 | ) | |||||||||
Net current period charges(1) | 16 | 12 | — | 28 | |||||||||||
Charges against reserve and currency | (41 | ) | (11 | ) | — | (52 | ) | ||||||||
Balance at March 31, 2018 | $ | 83 | $ | 2 | $ | — | $ | 85 | |||||||
Provision | 40 | — | — | 40 | |||||||||||
Reversals | (6 | ) | — | — | (6 | ) | |||||||||
Net current period charges(1) | 34 | — | — | 34 | |||||||||||
Charges against reserve and currency | (39 | ) | (1 | ) | — | (40 | ) | ||||||||
Balance at June 30, 2018 | $ | 78 | $ | 1 | $ | — | $ | 79 |
(1) | Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown for restructuring and asset impairments charges. |
(2) | Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Charges against reserve and currency | $ | (40 | ) | $ | (59 | ) | $ | (92 | ) | $ | (116 | ) | |||
Effects of foreign currency and other non-cash items | 3 | (7 | ) | 1 | (8 | ) | |||||||||
Restructuring cash payments | $ | (37 | ) | $ | (66 | ) | $ | (91 | ) | $ | (124 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Interest expense(1) | $ | 60 | $ | 57 | $ | 123 | $ | 126 | |||||||
Interest income(2) | 72 | 76 | 146 | 154 |
(1) | Includes Cost of financing as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income. |
(2) | Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income. |
Debt Instrument | Year First Designated | Notional Amount | Net Fair Value | Weighted Average Interest Rate Paid | Interest Rate Received | Basis | Maturity | |||||||||||||
Senior Note 2021 | 2014 | $ | 300 | $ | (5 | ) | 2.95 | % | 4.5 | % | Libor | 2021 |
• | Forecasted purchases and sales in foreign currency |
Designation of Derivatives | Balance Sheet Location | June 30, 2018 | December 31, 2017 | |||||||
Derivatives Designated as Hedging Instruments | ||||||||||
Foreign exchange contracts - forwards | Other current assets | $ | 5 | $ | 1 | |||||
Other current liabilities | (2 | ) | (15 | ) | ||||||
Foreign currency options | Other current assets | 2 | — | |||||||
Other current liabilities | (1 | ) | — | |||||||
Interest rate swaps | Other long-term assets | — | 1 | |||||||
Other long-term liabilities | (5 | ) | — | |||||||
Net designated derivative liability | $ | (1 | ) | $ | (13 | ) | ||||
Derivatives NOT Designated as Hedging Instruments | ||||||||||
Foreign exchange contracts – forwards | Other current assets | $ | 19 | $ | 1 | |||||
Other current liabilities | (4 | ) | (10 | ) | ||||||
Net undesignated derivative asset (liability) | $ | 15 | $ | (9 | ) | |||||
Summary of Derivatives | Total Derivative Assets | $ | 26 | $ | 3 | |||||
Total Derivative Liabilities | (12 | ) | (25 | ) | ||||||
Net Derivative asset (liability) | $ | 14 | $ | (22 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Gain (Loss) on Derivative Instruments | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Fair Value Hedges - Interest Rate Contracts | ||||||||||||||||
Derivative (loss) gain recognized in interest expense | $ | (1 | ) | $ | 2 | $ | (6 | ) | $ | 1 | ||||||
Hedged item gain (loss) recognized in interest expense | 1 | (2 | ) | 6 | (1 | ) | ||||||||||
Cash Flow Hedges - Foreign Exchange Forward Contracts and Options | ||||||||||||||||
Derivative (loss) gain recognized in OCI (effective portion) | $ | (2 | ) | $ | (22 | ) | $ | 10 | $ | (13 | ) | |||||
Derivative Loss reclassified from AOCL to income - Cost of sales (effective portion) | — | (4 | ) | (12 | ) | (8 | ) |
Derivatives NOT Designated as Hedging Instruments | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
Location of Derivative Gain | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Foreign exchange contracts – forwards | Other expense – Currency gain (loss), net | $ | 18 | $ | (14 | ) | $ | 18 | $ | (10 | ) |
June 30, 2018 | December 31, 2017 | ||||||
Assets: | |||||||
Foreign exchange contracts - forwards | $ | 24 | $ | 2 | |||
Foreign currency options | 2 | — | |||||
Interest rate swaps | — | 1 | |||||
Deferred compensation investments in mutual funds | 19 | 18 | |||||
Total | $ | 45 | $ | 21 | |||
Liabilities: | |||||||
Foreign exchange contracts - forwards | $ | 6 | $ | 25 | |||
Foreign currency options | 1 | — | |||||
Interest rate swaps | 5 | — | |||||
Deferred compensation plan liabilities | 18 | 19 | |||||
Total | $ | 30 | $ | 44 |
June 30, 2018 | December 31, 2017 | ||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||
Cash and cash equivalents | $ | 1,263 | $ | 1,263 | $ | 1,293 | $ | 1,293 | |||||||
Accounts receivable, net | 1,297 | 1,297 | 1,357 | 1,357 | |||||||||||
Short-term debt and current portion of long-term debt | 412 | 411 | 282 | 283 | |||||||||||
Long-term debt | 4,813 | 4,815 | 5,235 | 5,373 |
Three Months Ended June 30, | |||||||||||||||||||||||
Pension Benefits | |||||||||||||||||||||||
U.S. Plans | Non-U.S. Plans | Retiree Health | |||||||||||||||||||||
Components of Net Periodic Benefit Costs: | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Service cost | $ | — | $ | 1 | $ | 7 | $ | 8 | $ | 1 | $ | 1 | |||||||||||
Interest cost | 34 | 32 | 38 | 38 | 7 | 7 | |||||||||||||||||
Expected return on plan assets | (36 | ) | (30 | ) | (62 | ) | (54 | ) | — | — | |||||||||||||
Recognized net actuarial loss | 6 | 6 | 15 | 19 | — | — | |||||||||||||||||
Amortization of prior service credit | (1 | ) | (1 | ) | (1 | ) | (1 | ) | (1 | ) | (1 | ) | |||||||||||
Recognized settlement loss | 26 | 19 | — | — | — | — | |||||||||||||||||
Defined benefit plans | 29 | 27 | (3 | ) | 10 | 7 | 7 | ||||||||||||||||
Defined contribution plans(1) | 10 | 10 | 7 | 7 | n/a | n/a | |||||||||||||||||
Net Periodic Benefit Cost | 39 | 37 | 4 | 17 | 7 | 7 | |||||||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||||||||
Net actuarial loss (gain)(2) | 12 | 12 | — | — | 10 | (11 | ) | ||||||||||||||||
Amortization of net actuarial loss | (32 | ) | (25 | ) | (15 | ) | (19 | ) | — | — | |||||||||||||
Amortization of prior service credit | 1 | 1 | 1 | 1 | 1 | 1 | |||||||||||||||||
Total Recognized in Other Comprehensive (Loss) Income(3) | (19 | ) | (12 | ) | (14 | ) | (18 | ) | 11 | (10 | ) | ||||||||||||
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive (Loss) Income | $ | 20 | $ | 25 | $ | (10 | ) | $ | (1 | ) | $ | 18 | $ | (3 | ) |
Six Months Ended June 30, | |||||||||||||||||||||||
Pension Benefits | |||||||||||||||||||||||
U.S. Plans | Non-U.S. Plans | Retiree Health | |||||||||||||||||||||
Components of Net Periodic Benefit Costs: | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Service cost | $ | 1 | $ | 2 | $ | 13 | $ | 15 | $ | 2 | $ | 2 | |||||||||||
Interest cost | 67 | 66 | 77 | 77 | 13 | 14 | |||||||||||||||||
Expected return on plan assets | (70 | ) | (61 | ) | (125 | ) | (107 | ) | — | — | |||||||||||||
Recognized net actuarial loss | 12 | 11 | 30 | 38 | — | — | |||||||||||||||||
Amortization of prior service credit | (1 | ) | (1 | ) | (2 | ) | (2 | ) | (2 | ) | (2 | ) | |||||||||||
Recognized settlement loss | 51 | 61 | — | — | — | — | |||||||||||||||||
Defined benefit plans | 60 | 78 | (7 | ) | 21 | 13 | 14 | ||||||||||||||||
Defined contribution plans(1) | 19 | 20 | 14 | 14 | n/a | n/a | |||||||||||||||||
Net Periodic Benefit Cost | 79 | 98 | 7 | 35 | 13 | 14 | |||||||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||||||||
Net actuarial (gain) loss(2) | (46 | ) | 20 | — | — | 10 | (11 | ) | |||||||||||||||
Amortization of net actuarial loss | (63 | ) | (72 | ) | (30 | ) | (38 | ) | — | — | |||||||||||||
Amortization of prior service credit | 1 | 1 | 2 | 2 | 2 | 2 | |||||||||||||||||
Total Recognized in Other Comprehensive (Loss) Income(3) | (108 | ) | (51 | ) | (28 | ) | (36 | ) | 12 | (9 | ) | ||||||||||||
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive (Loss) Income | $ | (29 | ) | $ | 47 | $ | (21 | ) | $ | (1 | ) | $ | 25 | $ | 5 |
(2) | The net actuarial (gain) loss for U.S. Plans primarily reflects (i) the re-measurement of our primary U.S. pension plans as a result of the payment of periodic settlements and (ii) adjustments for the actuarial valuation results based on January 1st plan census data. |
(3) | Amounts represent the pre-tax effect included within Other Comprehensive (Loss) Income. Refer to Note 16 - Other Comprehensive (Loss) Income for related tax effects and the after-tax amounts. |
Six Months Ended June 30, | Year Ended December 31, | |||||||||||||||
2018 | 2017 | Estimated 2018 | 2017 | |||||||||||||
U.S. plans | $ | 14 | $ | 12 | $ | 76 | $ | 675 | ||||||||
Non-U.S. plans | 61 | 34 | 116 | 161 | ||||||||||||
Total Pension | $ | 75 | $ | 46 | $ | 192 | $ | 836 | ||||||||
Retiree Health | $ | 29 | $ | 32 | $ | 62 | $ | 64 |
Common Stock | Additional Paid-in Capital | Retained Earnings | AOCL(4) | Xerox Shareholders’ Equity | Non-controlling Interests | Total Equity | |||||||||||||||||||||
Balance at December 31, 2017 | $ | 255 | $ | 3,893 | $ | 4,856 | $ | (3,748 | ) | $ | 5,256 | $ | 37 | $ | 5,293 | ||||||||||||
Cumulative effect of change in accounting principles(1) | — | — | 120 | — | 120 | — | 120 | ||||||||||||||||||||
Comprehensive income (loss), net | — | — | 135 | (24 | ) | 111 | 5 | 116 | |||||||||||||||||||
Cash dividends declared - common(2) | — | — | (130 | ) | — | (130 | ) | — | (130 | ) | |||||||||||||||||
Cash dividends declared - preferred(3) | — | — | (7 | ) | — | (7 | ) | — | (7 | ) | |||||||||||||||||
Stock option and incentive plans, net | — | 27 | — | — | 27 | — | 27 | ||||||||||||||||||||
Distributions to noncontrolling interests | — | — | — | — | — | (11 | ) | (11 | ) | ||||||||||||||||||
Balance at June 30, 2018 | $ | 255 | $ | 3,920 | $ | 4,974 | $ | (3,772 | ) | $ | 5,377 | $ | 31 | $ | 5,408 |
Common Stock | Additional Paid-in Capital | Retained Earnings | AOCL(4) | Xerox Shareholders’ Equity | Non- controlling Interests | Total Equity | |||||||||||||||||||||
Balance at December 31, 2016 | $ | 254 | $ | 3,858 | $ | 4,934 | $ | (4,337 | ) | $ | 4,709 | $ | 38 | $ | 4,747 | ||||||||||||
Comprehensive income, net | — | — | 206 | 327 | 533 | 7 | 540 | ||||||||||||||||||||
Cash dividends declared - common(2) | — | — | (129 | ) | — | (129 | ) | — | (129 | ) | |||||||||||||||||
Cash dividends declared - preferred(3) | — | — | (7 | ) | — | (7 | ) | — | (7 | ) | |||||||||||||||||
Stock option and incentive plans, net | — | 17 | — | — | 17 | — | 17 | ||||||||||||||||||||
Distributions to noncontrolling interests | — | — | — | — | — | (10 | ) | (10 | ) | ||||||||||||||||||
Balance at June 30, 2017 | $ | 254 | $ | 3,875 | $ | 5,004 | $ | (4,010 | ) | $ | 5,123 | $ | 35 | $ | 5,158 |
(1) | Includes $117 related to the adoptions of the new Revenue Recognition Standard, see Note 2 for additional information, and $3 related to our share of Fuji Xerox's adoption of ASU 2016-01 - Financial Instruments - Classification and Measurement. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Stock-based compensation expense, pre-tax | $ | 13 | $ | 12 | $ | 29 | $ | 25 | ||||||||
Income tax benefit recognized in earnings | 3 | 3 | 7 | 6 |
Three Months Ended June 30, 2018 | ||||
Term | 3 years | |||
Risk-free interest rate(1) | 2.39 | % | ||
Dividend yield(2) | 3.24 | % | ||
Xerox’s historical volatility(3) | 29.12 | % | ||
Weighted average fair value(4) | $ | 32.21 |
(1) | The risk-free interest rate was based on the zero-coupon U.S. Treasury yield curve from the valuation date, with a maturity matched to the TSR performance period. |
(2) | The dividend yield was calculated as the expected quarterly dividend divided by Xerox’s three-month average stock price as of the valuation date. |
(3) | Xerox’s historical volatility is calculated from daily stock returns over a 3.0-year look-back term from the valuation date. |
(4) | The weighted average of fair values used to record compensation expense as determined by the Monte Carlo simulation. |
Percentile | Payout as a Percent of Target(1) | ||
80th and above | 200 | % | |
50th | 100 | % | |
25th | 35 | % | |
Below 25th | 0 | % |
(1) | For performance between the levels described above, the degree of vesting is interpolated on a linear basis. |
Three Months Ended June 30, 2018 | ||||
Expected term(1) | 6.13 years | |||
Expected volatility(2) | 27.25 | % | ||
Expected dividend yield(3) | 3.25 | % | ||
Risk-free interest rate(4) | 2.63 | % | ||
Weighted average fair value(5) | $ | 5.75 |
(1) | Since these SO grants are effectively part of a new program, the expected term was calculated using the "Simplified Method” under the SEC guidance based on the SOs vesting schedule and contractual term. We did not have sufficient historical exercise data to provide a reasonable basis to estimate an expected term. |
(2) | The expected volatility was calculated based on a combination of Xerox's term-matched historical volatility and implied volatility from traded options. |
(3) | The dividend yield was calculated as the expected quarterly dividend divided by Xerox’s three-month average stock price as of the grant date. |
(4) | The risk-free interest rate was based on the zero-coupon U.S. Treasury yield curve with a maturity matched to the expected term of the SOs. |
(5) | The weighted average of fair values used to record compensation expense as determined by the BS option-pricing model. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||
Pre-tax | Net of Tax | Pre-tax | Net of Tax | Pre-tax | Net of Tax | Pre-tax | Net of Tax | |||||||||||||||||||||||||
Translation Adjustments (Losses) Gains | $ | (335 | ) | $ | (322 | ) | $ | 204 | $ | 204 | $ | (151 | ) | $ | (146 | ) | $ | 338 | $ | 337 | ||||||||||||
Unrealized (Losses) Gains | ||||||||||||||||||||||||||||||||
Changes in fair value of cash flow hedges - (losses) gains | (2 | ) | (1 | ) | (22 | ) | (17 | ) | 10 | 7 | (13 | ) | (11 | ) | ||||||||||||||||||
Changes in cash flow hedges reclassed to earnings(1) | — | — | 4 | 2 | 12 | 10 | 8 | 4 | ||||||||||||||||||||||||
Other (losses) gains | (2 | ) | (2 | ) | 1 | 1 | (3 | ) | (3 | ) | 1 | 1 | ||||||||||||||||||||
Net unrealized (losses) gains | (4 | ) | (3 | ) | (17 | ) | (14 | ) | 19 | 14 | (4 | ) | (6 | ) | ||||||||||||||||||
Defined Benefit Plans (Losses) Gains | ||||||||||||||||||||||||||||||||
Net actuarial/prior service (losses) gains | (22 | ) | (16 | ) | (1 | ) | (1 | ) | 36 | 27 | (9 | ) | (6 | ) | ||||||||||||||||||
Prior service amortization(2) | (3 | ) | (3 | ) | (3 | ) | (2 | ) | (5 | ) | (4 | ) | (5 | ) | (3 | ) | ||||||||||||||||
Actuarial loss amortization/settlement(2) | 47 | 35 | 44 | 30 | 93 | 70 | 110 | 74 | ||||||||||||||||||||||||
Fuji Xerox changes in defined benefit plans, net(3) | (3 | ) | (3 | ) | 8 | 8 | (24 | ) | (24 | ) | 21 | 21 | ||||||||||||||||||||
Other gains (losses)(4) | 77 | 77 | (64 | ) | (64 | ) | 39 | 39 | (89 | ) | (89 | ) | ||||||||||||||||||||
Changes in defined benefit plans gains (losses) | 96 | 90 | (16 | ) | (29 | ) | 139 | 108 | 28 | (3 | ) | |||||||||||||||||||||
Other Comprehensive (Loss) Income | (243 | ) | (235 | ) | 171 | 161 | 7 | (24 | ) | 362 | 328 | |||||||||||||||||||||
Less: Other comprehensive income attributable to noncontrolling interests | — | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||||||
Other Comprehensive (Loss) Income Attributable to Xerox | $ | (243 | ) | $ | (235 | ) | $ | 171 | $ | 161 | $ | 7 | $ | (24 | ) | $ | 361 | $ | 327 |
(1) | Reclassified to Cost of sales - refer to Note 12 - Financial Instruments for additional information regarding our cash flow hedges. |
(2) | Reclassified to Total Net Periodic Benefit Cost - refer to Note 14 - Employee Benefit Plans for additional information. |
(3) | Represents our share of Fuji Xerox's benefit plan changes. |
(4) | Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL. |
June 30, 2018 | December 31, 2017 | |||||||
Cumulative translation adjustments | $ | (1,927 | ) | $ | (1,781 | ) | ||
Other unrealized gains (losses), net | 2 | (12 | ) | |||||
Benefit plans net actuarial losses and prior service credits(1) | (1,847 | ) | (1,955 | ) | ||||
Total Accumulated other comprehensive loss attributable to Xerox | $ | (3,772 | ) | $ | (3,748 | ) |
(1) | Includes our share of Fuji Xerox. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Basic Earnings (Loss) per Share: | |||||||||||||||
Net Income from Continuing Operations Attributable to Xerox | $ | 112 | $ | 166 | $ | 135 | $ | 212 | |||||||
Accrued dividends on preferred stock | (3 | ) | (3 | ) | (7 | ) | (7 | ) | |||||||
Adjusted Net income from continuing operations available to common shareholders | 109 | 163 | 128 | 205 | |||||||||||
Net loss from discontinued operations attributable to Xerox | — | — | — | (6 | ) | ||||||||||
Adjusted Net income available to common shareholders | $ | 109 | $ | 163 | $ | 128 | $ | 199 | |||||||
Weighted average common shares outstanding | 254,895 | 254,193 | 254,791 | 254,107 | |||||||||||
Basic Earnings (Loss) per Share: | |||||||||||||||
Continuing operations | $ | 0.42 | $ | 0.64 | $ | 0.50 | $ | 0.81 | |||||||
Discontinued operations | — | — | — | (0.03 | ) | ||||||||||
Basic Earnings per Share | $ | 0.42 | $ | 0.64 | $ | 0.50 | $ | 0.78 | |||||||
Diluted Earnings (Loss) per Share: | |||||||||||||||
Net Income from Continuing Operations Attributable to Xerox | $ | 112 | $ | 166 | $ | 135 | $ | 212 | |||||||
Accrued dividends on preferred stock | (3 | ) | — | (7 | ) | (7 | ) | ||||||||
Adjusted Net income from continuing operations available to common shareholders | 109 | 166 | 128 | 205 | |||||||||||
Net loss from discontinued operations attributable to Xerox | — | — | — | (6 | ) | ||||||||||
Adjusted Net income available to common shareholders | $ | 109 | $ | 166 | $ | 128 | $ | 199 | |||||||
Weighted average common shares outstanding | 254,895 | 254,193 | 254,791 | 254,107 | |||||||||||
Common shares issuable with respect to: | |||||||||||||||
Stock options | — | — | — | — | |||||||||||
Restricted stock and performance shares | 3,052 | 2,275 | 2,931 | 2,190 | |||||||||||
Convertible preferred stock | — | 6,742 | — | — | |||||||||||
Adjusted Weighted average common shares outstanding | 257,947 | 263,210 | 257,722 | 256,297 | |||||||||||
Diluted Earnings (Loss) per Share: | |||||||||||||||
Continuing operations | $ | 0.42 | $ | 0.63 | $ | 0.50 | $ | 0.80 | |||||||
Discontinued operations | — | — | — | (0.02 | ) | ||||||||||
Diluted Earnings per Share | $ | 0.42 | $ | 0.63 | $ | 0.50 | $ | 0.78 | |||||||
The following securities were not included in the computation of diluted earnings per share as they were either contingently issuable shares or shares that if included would have been anti-dilutive: | |||||||||||||||
Stock options | 1,097 | — | 1,097 | — | |||||||||||
Restricted stock and performance shares | 4,329 | 2,375 | 4,450 | 2,460 | |||||||||||
Convertible preferred stock | 6,742 | — | 6,742 | 6,742 | |||||||||||
Total Anti-Dilutive Securities | 12,168 | 2,375 | 12,289 | 9,202 | |||||||||||
Dividends per Common Share | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 |
1. | Deason v. Fujifilm Holdings Corp., et al.; Deason v. Xerox Corp., et al.; In re Xerox Corporation Consolidated Shareholder Litigation: |
2. | Ribbe v. Jacobson, et al.: |
3. | Fujifilm Holdings Corp. v. Xerox Corporation: |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
(in millions) | 2018 | 2017 | B/(W) | 2018 | 2017 | B/(W) | ||||||||||||||||||
Net income from continuing operations attributable to Xerox | $ | 112 | $ | 166 | $ | (54 | ) | $ | 135 | $ | 212 | $ | (77 | ) | ||||||||||
Adjusted(1) Net income from continuing operations attributable to Xerox | 213 | 224 | (11 | ) | 391 | 400 | (9 | ) |
(1) | See the “Non-GAAP Financial Measures” section for an explanation of the non-GAAP financial measure. |
(2) | Working capital reflects Accounts receivable, net, Inventories and Accounts payable and accrued compensation. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||
(in millions) | 2018 | 2017 | % Change | CC % Change | 2018 | 2017 | % Change | CC % Change | % of Total Revenue 2018 | % of Total Revenue 2017 | ||||||||||||||||||||||||
Equipment sales | $ | 561 | $ | 556 | 0.9 | % | (0.6 | )% | $ | 1,060 | $ | 1,069 | (0.8 | )% | (3.3 | )% | 21 | % | 21 | % | ||||||||||||||
Post sale revenue | 1,949 | 2,011 | (3.1 | )% | (5.0 | )% | 3,885 | 3,952 | (1.7 | )% | (4.6 | )% | 79 | % | 79 | % | ||||||||||||||||||
Total Revenue | $ | 2,510 | $ | 2,567 | (2.2 | )% | (4.0 | )% | $ | 4,945 | $ | 5,021 | (1.5 | )% | (4.3 | )% | 100 | % | 100 | % | ||||||||||||||
Reconciliation to Condensed Consolidated Statements of Income: | ||||||||||||||||||||||||||||||||||
Sales | $ | 1,017 | $ | 1,010 | 0.7 | % | (0.3 | )% | $ | 1,950 | $ | 1,946 | 0.2 | % | (2.8 | )% | ||||||||||||||||||
Less: Supplies, paper and other sales | (456 | ) | (463 | ) | (1.5 | )% | (2.0 | )% | (890 | ) | (897 | ) | (0.8 | )% | (2.2 | )% | ||||||||||||||||||
Add: Equipment-related training(1) | — | 9 | NM | NM | — | 20 | NM | NM | ||||||||||||||||||||||||||
Equipment sales | $ | 561 | $ | 556 | 0.9 | % | (0.6 | )% | $ | 1,060 | $ | 1,069 | (0.8 | )% | (3.3 | )% | ||||||||||||||||||
Services, maintenance and rentals | $ | 1,425 | $ | 1,483 | (3.9 | )% | (6.1 | )% | $ | 2,856 | $ | 2,925 | (2.4 | )% | (5.0 | )% | ||||||||||||||||||
Add: Supplies, paper and other sales | 456 | 463 | (1.5 | )% | (2.0 | )% | 890 | 897 | (0.8 | )% | (2.2 | )% | ||||||||||||||||||||||
Add: Financing | 68 | 74 | (8.1 | )% | (10.9 | )% | 139 | 150 | (7.3 | )% | (10.8 | )% | ||||||||||||||||||||||
Less: Equipment-related training(1) | — | (9 | ) | NM | NM | — | (20 | ) | NM | NM | ||||||||||||||||||||||||
Post sale revenue | $ | 1,949 | $ | 2,011 | (3.1 | )% | (5.0 | )% | $ | 3,885 | $ | 3,952 | (1.7 | )% | (4.6 | )% | ||||||||||||||||||
North America | $ | 1,514 | $ | 1,534 | (1.3 | )% | (1.8 | )% | $ | 2,952 | $ | 3,007 | (1.8 | )% | (2.3 | )% | 60 | % | 60 | % | ||||||||||||||
International | 898 | 895 | 0.3 | % | (3.9 | )% | 1,789 | 1,747 | 2.4 | % | (4.7 | )% | 36 | % | 35 | % | ||||||||||||||||||
Other | 98 | 138 | (29.0 | )% | (29.0 | )% | 204 | 267 | (23.6 | )% | (23.6 | )% | 4 | % | 5 | % | ||||||||||||||||||
Total Revenue(2) | $ | 2,510 | $ | 2,567 | (2.2 | )% | (4.0 | )% | $ | 4,945 | $ | 5,021 | (1.5 | )% | (4.3 | )% | 100 | % | 100 | % | ||||||||||||||
Memo: | ||||||||||||||||||||||||||||||||||
Managed Document Services(3) | $ | 871 | $ | 833 | 4.6 | % | 2.3 | % | $ | 1,733 | $ | 1,653 | 4.8 | % | 1.5 | % | 35 | % | 33 | % |
(1) | In 2018, upon adoption of ASU 2014-09 Revenue Recognition, revenue from training related to equipment installation is now included in Equipment sales. In prior periods, this revenue was reported within Services, maintenance and rentals. |
(2) | Refer to the "Geographic Sales Channels and Product and Offerings Definitions" section. |
(3) | Excluding Equipment revenue, Managed Document Services (MDS) was $752 million and $736 million for the three months ended June 30, 2018 and 2017, respectively, representing an increase of 2.2% including a 2.1-percentage point favorable impact from currency. For the six months ended June 30, 2018 and 2017, excluding equipment revenue, MDS was $1,505 million and $1,450 million, respectively, representing an increase of 3.8% including a 3.2-percentage point favorable impact from currency. |
• | Services, maintenance and rentals revenue includes rental and maintenance revenue (including bundled supplies) as well as the post sale component of the document services revenue from our Managed Document Services (MDS) offerings, and revenues from our Communication and Marketing Solutions (CMS). |
◦ | For the three months ended June 30, 2018 Service, maintenance and rentals revenues decreased 3.9% as compared to second quarter 2017, with a 2.2-percentage point favorable impact from currency. The decline at constant currency1 reflected the continuing trends of lower page volumes (including a higher mix of lower usage products), an ongoing competitive price environment, and a lower population of devices, which are partially associated with lower signings and installs in prior periods. These impacts are partially offset by higher revenues from MDS, driven by our SMB-focused channels, along with revenues from our Global Imaging business, inclusive of acquisitions. |
◦ | For the six months ended June 30, 2018 Service, maintenance and rentals revenues decreased 2.4% as compared to the prior year period, with a 2.6-percentage point favorable impact from currency. The decline at constant currency1 reflected the continuing trends of lower page volumes (including a higher mix of lower usage products), an ongoing competitive price environment and a lower population of devices, which are partially associated with lower signings and installs in prior periods. These impacts are partially offset by higher revenues from MDS, driven by our SMB-focused channels, along with revenues from our Global Imaging business, inclusive of acquisitions, and higher revenues from developing markets. |
• | Supplies, paper and other sales includes unbundled supplies and other sales. |
◦ | For the three months ended June 30, 2018 Supplies paper and other sales decreased 1.5% as compared to second quarter 2017, with a 0.5-percentage point favorable impact from currency. The decline at constant currency1 was driven by lower network integration and software licensing sales, while paper and supplies revenues increased, excluding original equipment manufacturer (OEM), supplies primarily from higher sales in developing markets and our Global Imaging business. |
◦ | For the six months ended June 30, 2018 Supplies paper and other sales decreased 0.8% as compared to the prior year period, with a 1.4-percentage point favorable impact from currency. The decline at constant currency1 was driven by continued declines in OEM supplies as well as lower supplies demand consistent with a lower population of devices in the field and lower network integration and software licensing sales, partially offset by higher paper sales and supplies sales within our Global Imaging business. |
• | Financing revenue is generated from financed equipment sale transactions. For the three months ended June 30, 2018 Financing revenue decreased 8.1% compared to second quarter 2017, with a 2.8-percentage point favorable impact from currency, while Financing revenue decreased 7.3% for the six months ended June 30, 2018 as compared to the prior year period, with a 3.5-percentage point favorable impact from currency. The decrease in these revenues reflected a declining finance receivables balance due to lower equipment sales in prior periods. |
Three Months Ended June 30, | Six Months Ended June 30, | % of Equipment Sales | ||||||||||||||||||||||||||
(in millions) | 2018 | 2017 | % Change | CC % Change | 2018 | 2017 | % Change | CC % Change | 2018 | 2017 | ||||||||||||||||||
Entry(1) | $ | 62 | $ | 55 | 12.7% | 10.6% | $ | 115 | $ | 111 | 3.6% | (0.3)% | 11% | 10% | ||||||||||||||
Mid-range | 390 | 358 | 8.9% | 7.4% | 724 | 690 | 4.9% | 2.6% | 68% | 65% | ||||||||||||||||||
High-end | 100 | 109 | (8.3)% | (9.9)% | 192 | 206 | (6.8)% | (9.7)% | 18% | 19% | ||||||||||||||||||
Other(1) | 9 | 34 | (73.5)% | (73.5)% | 29 | 62 | (53.2)% | (53.2)% | 3% | 6% | ||||||||||||||||||
Equipment sales(2) | $ | 561 | $ | 556 | 0.9% | (0.6)% | $ | 1,060 | $ | 1,069 | (0.8)% | (3.3)% | 100% | 100% |
(1) | In 2018, revenues from our OEM business are included in Other, which had historically been reported within Entry. This reclassification was made to provide better transparency to our business results. Prior year amounts have been adjusted to conform to this change. |
(2) | In 2018, upon adoption of ASU 2014-09 Revenue Recognition, revenue from training related to equipment installation is now included in Equipment Sales (previously included in Post sale revenue). Prior year amounts have been adjusted to conform to this change. |
• | 21% increase in color multifunction devices, reflecting demand for recently launched products across nearly all channels. |
• | 21% increase in black-and-white multifunction devices, driven largely by higher activity from low-end devices in developing markets as well as higher sales through U.S. indirect channels. |
• | 29% increase in mid-range color installs, reflecting demand across large enterprise and indirect channels as well as a favorable impact due to the timing of our ConnectKey launch in the prior year. |
• | 13% increase in mid-range black-and-white, reflecting demand for recently launched products as well as a favorable impact due to the timing of our ConnectKey launch in the prior year which more than offset market trends. |
• | 9% decrease in high-end color installs, as growth from our new Iridesse production press was offset by lower installs of iGen and lower-end production systems. |
• | 12% decrease in high-end black-and-white systems reflecting market trends. |
• | 13% increase in color multifunction devices, reflecting demand for recently launched products across nearly all channels. |
• | 20% increase in black-and-white multifunction devices, driven largely by higher activity from low-end devices in developing markets as well as higher sales through U.S. indirect channels. |
• | 23% increase in mid-range color installs, demand across large enterprise and indirect channels as well as a favorable impact due to the timing of our ConnectKey launch in the prior year. |
• | 12% increase in mid-range black-and-white, as demand for recently launched products and a favorable impact due to the timing of our ConnectKey launch in the prior year more than offset market trends. |
• | 3% decrease in high-end color systems, as growth from Iridesse and Versant products was offset by lower installs of iGen and lower-end production systems. |
• | 11% decrease in high-end black-and-white systems reflecting market trends. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
(in millions) | 2018 | 2017 | % Change | CC % Change | 2018 | 2017 | % Change | CC % Change | ||||||||||||||||
Signings | $ | 517 | $ | 643 | (19.6)% | (20.7)% | $ | 1,026 | $ | 1,155 | (11.2)% | (12.4)% |
• | North America, which includes our sales channels in the U.S. and Canada. |
• | International, which includes our sales channels in Europe, Eurasia, Latin America, Middle East, Africa and India. |
• | Other primarily includes our OEM business, as well as sales to and royalties from Fuji Xerox, and our licensing revenue. |
• | “Entry”, which includes A4 devices and desktop printers. Prices in this product group can range from approximately $150 to $3,000. |
• | “Mid-Range”, which includes A3 Office and Light Production devices that generally serve workgroup environments in mid to large enterprises. Prices in this product group can range from approximately $2,000 to $75,000+. |
• | “High-End”, which includes production printing and publishing systems that generally serve the graphic communications marketplace and large enterprises. Prices for these systems can range from approximately $30,000 to $1,000,000+. |
• | Managed Document Services (MDS) revenue, which includes solutions and services that span from managing print to automating processes to managing content. Our primary offerings within MDS are Managed Print Services (including from Global Imaging Systems), as well as workflow automation services, and Centralized Print Services and Solutions (CPS). MDS excludes Communications and Marketing Solutions (CMS). |
(1) | Entry installations exclude OEM sales; including OEM sales, for the three and six months ended June 30, 2018 Entry color multifunction devices decreased 20% and 7%,respectively, while Entry black-and-white multifunction devices increased 12% and 14%, respectively. |
(2) | Mid-range and High-end color installations exclude Fuji Xerox digital front-end sales; including Fuji Xerox digital front-end sales, for the three and six months ended June 30, 2018 Mid-range color devices increased 29% and 23%, respectively and High-end color systems decreased 10% and 3%, respectively. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(in millions) | 2018 | 2017 | B/(W) | 2018 | 2017 | B/(W) | ||||||||||||||||||||
Gross Profit | $ | 1,001 | $ | 1,043 | $ | (42 | ) | $ | 1,971 | $ | 2,018 | $ | (47 | ) | ||||||||||||
RD&E | 101 | 102 | 1 | 201 | 213 | 12 | ||||||||||||||||||||
SAG | 624 | 626 | 2 | 1,252 | 1,260 | 8 | ||||||||||||||||||||
Equipment Gross Margin | 31.8 | % | 28.7 | % | 3.1 | pts. | 32.1 | % | 29.7 | % | 2.4 | pts. | ||||||||||||||
Post sale Gross Margin | 42.1 | % | 43.9 | % | (1.8 | ) | pts. | 42.0 | % | 43.0 | % | (1.0 | ) | pts. | ||||||||||||
Total Gross Margin | 39.9 | % | 40.6 | % | (0.7 | ) | pts. | 39.9 | % | 40.2 | % | (0.3 | ) | pts. | ||||||||||||
RD&E as a % of Revenue | 4.0 | % | 4.0 | % | — | pts. | 4.1 | % | 4.2 | % | 0.1 | pts. | ||||||||||||||
SAG as a % of Revenue | 24.9 | % | 24.4 | % | (0.5 | ) | pts. | 25.3 | % | 25.1 | % | (0.2 | ) | pts. | ||||||||||||
Pre-tax Income | $ | 133 | $ | 193 | $ | (60 | ) | $ | 267 | $ | 177 | $ | 90 | |||||||||||||
Pre-tax Income Margin | 5.3 | % | 7.5 | % | (2.2 | ) | pts. | 5.4 | % | 3.5 | % | 1.9 | pts. | |||||||||||||
Adjusted(1) Operating Profit | $ | 299 | $ | 338 | $ | (39 | ) | $ | 552 | $ | 608 | $ | (56 | ) | ||||||||||||
Adjusted(1) Operating Margin | 11.9 | % | 13.2 | % | (1.3 | ) | pts. | 11.2 | % | 12.1 | % | (0.9 | ) | pts. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(in millions) | 2018 | 2017 | Change | 2018 | 2017 | Change | |||||||||||||||||
R&D | $ | 83 | $ | 78 | $ | 5 | $ | 164 | $ | 166 | $ | (2 | ) | ||||||||||
Sustaining engineering | 18 | 24 | (6 | ) | 37 | 47 | (10 | ) | |||||||||||||||
Total RD&E Expenses | $ | 101 | $ | 102 | $ | (1 | ) | $ | 201 | $ | 213 | $ | (12 | ) |
• | Costs related to the previously disclosed settlement agreement reached with certain shareholders as well as third-party legal and other related costs associated with on-going litigation resulting from the terminated combination transaction and other related shareholder actions. |
• | $19 million of costs related to the commitment for a $2.5 billion unsecured bridge loan facility, which was terminated concurrent with the termination of the Fuji Xerox combination transaction. |
• | Insurance recoveries of approximately $15 million for litigation and related settlement costs. We continue to pursue additional recoveries from insurance carriers and other parties for costs and expenses related to the terminated transaction and shareholder litigation and therefore additional recoveries and adjustments may be recorded in future periods, when finalized. As previously disclosed, in July 2018, we reached a settlement with a financial advisor for the refund of approximately $13.5 million, which will be recorded in the third quarter 2018. |
• | Costs related to the proposed combination transaction with Fuji Xerox, which was terminated in May 2018, primarily for third-party accounting, legal, consulting and other similar types of services. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Non-financing interest expense | $ | 27 | $ | 24 | $ | 56 | $ | 60 | |||||||
Non-service retirement-related costs | 25 | 34 | 50 | 94 | |||||||||||
Interest income | (4 | ) | (2 | ) | (7 | ) | (4 | ) | |||||||
Gains on sales of businesses and assets | (16 | ) | (1 | ) | (32 | ) | (1 | ) | |||||||
Currency losses (gains), net | 1 | 1 | (1 | ) | 4 | ||||||||||
Loss on sales of accounts receivable | — | 3 | 1 | 6 | |||||||||||
Loss on early extinguishment of debt | — | — | — | 13 | |||||||||||
All other expenses, net | 6 | 9 | 2 | 10 | |||||||||||
Other expenses, net | $ | 39 | $ | 68 | $ | 69 | $ | 182 |
(1) | Refer to the Effective Tax Rate reconciliation table in the "Non-GAAP Financial Measures" section. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Total Equity in net income (loss) of unconsolidated affiliates | $ | 19 | $ | 20 | $ | (49 | ) | $ | 60 | |||||||
Fuji Xerox after-tax restructuring and other charges included in equity income (loss) | 4 | 3 | 83 | 3 |
(1) | Refer to the Net income and EPS reconciliation table in the "Non-GAAP Financial Measures" section. |
Six Months Ended June 30, | Change | |||||||||||
(in millions) | 2018 | 2017 | ||||||||||
Net cash provided by operating activities of continuing operations | $ | 451 | $ | 413 | $ | 38 | ||||||
Net cash used in operating activities of discontinued operations | — | (95 | ) | 95 | ||||||||
Net cash provided by operating activities | 451 | 318 | 133 | |||||||||
Net cash used in investing activities | (17 | ) | (41 | ) | 24 | |||||||
Net cash used in financing activities | (456 | ) | (1,338 | ) | 882 | |||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (19 | ) | 36 | (55 | ) | |||||||
Decrease in cash, cash equivalents and restricted cash | (41 | ) | (1,025 | ) | 984 | |||||||
Cash, cash equivalents and restricted cash at beginning of period | 1,368 | 2,402 | (1,034 | ) | ||||||||
Cash, Cash Equivalents and Restricted Cash at End of Period | $ | 1,327 | $ | 1,377 | $ | (50 | ) |
• | $41 million increase in pre-tax income before Transaction and related costs, net, Depreciation and amortization, Gain on sales of businesses and assets, Restructuring and asset impairment charges and Defined benefit pension costs. |
• | $176 million increase from accounts receivable primarily due to the timing of collections and lower revenue, as well as the prior year reclassification of $99 million of collections of deferred proceeds from the sales of accounts receivables to investing. |
• | $33 million increase from lower restructuring payments. |
• | $18 million increase due to lower net tax payments. |
• | $17 million increase from inventory due to timing of the product launch in prior year. |
• | $98 million decrease primarily related to the prior year settlements of foreign currency derivative contracts. |
• | $68 million decrease from Accounts payable and accrued compensation primarily related to the year-over-year timing of supplier and vendor payments. |
• | $38 million decrease due to net payments for Transaction and related costs. |
• | $29 million decrease from higher pension contributions primarily in the U.K. Refer to Note 14 - Employee Benefit Plans in the Condensed Consolidated Financial Statements for additional information. |
• | $27 million decrease in dividends received from equity investments primarily due to lower income from Fuji Xerox. |
• | $99 million decrease primarily as a result of the termination of certain accounts receivables sales arrangements in fourth quarter 2017. |
• | $76 million increase due to no acquisitions in 2018. |
• | $31 million increase primarily from the sale of non-core business assets in 2018. |
• | $1,018 million decrease from net debt activity. 2018 reflects payments of $265 million on Senior Notes, $25 million related to the termination of a capital lease obligation and $19 million of bridge facility costs. 2017 reflects payments of $1.0 billion on Senior Notes and net payments of $326 million on the tender and exchange of certain Senior Notes including transaction costs. |
• | $20 million decrease from common and preferred stock dividends. |
• | $161 million increase resulting from the prior year final cash adjustment with Conduent. |
(in millions) | June 30, 2018 | December 31, 2017 | ||||||
Principal debt balance(1) | $ | 5,286 | $ | 5,579 | ||||
Net unamortized discount | (30 | ) | (35 | ) | ||||
Debt issuance costs | (28 | ) | (32 | ) | ||||
Fair value adjustments(2) | ||||||||
- terminated swaps | (8 | ) | 4 | |||||
- current swaps | 5 | 1 | ||||||
Total Debt | $ | 5,225 | $ | 5,517 |
(1) | Includes Notes Payable of $4 million and $6 million as of June 30, 2018 and December 31, 2017, respectively. |
(2) | Fair value adjustments include the following - (i) fair value adjustments to debt associated with terminated interest rate swaps, which are being amortized to interest expense over the remaining term of the related notes; and (ii) changes in fair value of hedged debt obligations attributable to movements in benchmark interest rates. Hedge accounting requires hedged debt instruments to be reported inclusive of any fair value adjustment. |
(in millions) | June 30, 2018 | December 31, 2017 | ||||||
Total finance receivables, net(1) | $ | 3,523 | $ | 3,752 | ||||
Equipment on operating leases, net | 438 | 454 | ||||||
Total Finance Assets, net(2) | $ | 3,961 | $ | 4,206 |
(1) | Includes (i) Billed portion of finance receivables, net, (ii) Finance receivables, net and (iii) Finance receivables due after one year, net as included in our Condensed Consolidated Balance Sheets. |
(2) | The change from December 31, 2017 includes a decrease of $64 million due to currency. |
(in millions) | June 30, 2018 | December 31, 2017 | ||||||
Finance receivables debt(1) | $ | 3,084 | $ | 3,283 | ||||
Equipment on operating leases debt | 383 | 397 | ||||||
Financing debt | 3,467 | 3,680 | ||||||
Core debt | 1,758 | 1,837 | ||||||
Total Debt | $ | 5,225 | $ | 5,517 |
(1) | Finance receivables debt is the basis for our calculation of "Cost of financing" expense in the Condensed Consolidated Statements of Income. |
(in millions) | Amount | |||
2018 Q3 | $ | 5 | ||
2018 Q4 | — | |||
2019 | 961 | |||
2020 | 1,052 | |||
2021 | 1,064 | |||
2022 | 302 | |||
2023 and thereafter | 1,902 | |||
Total | $ | 5,286 |
• | Net income and Earnings per share (EPS) |
• | Effective tax rate |
• | 2017 - Loss on early extinguishment of debt in the first quarter of 2017. |
• | 2017 - A benefit from the remeasurement of a tax matter in the first quarter of 2017 that related to a previously adjusted item. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||
(in millions, except per share amounts) | Net Income | EPS | Net Income | EPS | Net Income | EPS | Net Income | EPS | ||||||||||||||||||||||||
Reported(1) | $ | 112 | $ | 0.42 | $ | 166 | $ | 0.63 | $ | 135 | $ | 0.50 | $ | 212 | $ | 0.80 | ||||||||||||||||
Adjustments: | ||||||||||||||||||||||||||||||||
Restructuring and related costs | 34 | 39 | 62 | 157 | ||||||||||||||||||||||||||||
Amortization of intangible assets | 12 | 15 | 24 | 29 | ||||||||||||||||||||||||||||
Transaction and related costs, net | 58 | — | 96 | — | ||||||||||||||||||||||||||||
Non-service retirement-related costs | 25 | 34 | 50 | 94 | ||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | — | — | 13 | ||||||||||||||||||||||||||||
Income tax on adjustments(2) | (32 | ) | (33 | ) | (59 | ) | (92 | ) | ||||||||||||||||||||||||
Remeasurement of unrecognized tax positions | — | — | — | (16 | ) | |||||||||||||||||||||||||||
Restructuring and other charges - Fuji Xerox(3) | 4 | 3 | 83 | 3 | ||||||||||||||||||||||||||||
Adjusted | $ | 213 | $ | 0.80 | $ | 224 | $ | 0.86 | $ | 391 | $ | 1.48 | $ | 400 | $ | 1.52 | ||||||||||||||||
Dividends on preferred stock used in adjusted EPS calculation(4) | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||
Weighted average shares for adjusted EPS(4) | 265 | 263 | 264 | 263 | ||||||||||||||||||||||||||||
Fully diluted shares at end of period(5) | 265 | — |
(1) | Net income and EPS from continuing operations attributable to Xerox. |
(2) | Refer to Effective Tax Rate reconciliation. |
(3) | Other charges in 2018 represent costs associated with the terminated combination transaction. |
(4) | For those periods that exclude the preferred stock dividend, the average shares for the calculations of diluted EPS include 7 million shares associated with our Series B Convertible preferred stock, as applicable. |
(5) | Represents common shares outstanding at June 30, 2018 as well as shares associated with our Series B Convertible preferred stock plus potential dilutive common shares as used for the calculation of diluted earnings per share for the second quarter 2018. |
Three Months Ended June 30, | |||||||||||||||||||||
2018 | 2017 | ||||||||||||||||||||
(in millions) | Pre-Tax Income | Income Tax Expense | Effective Tax Rate | Pre-Tax Income | Income Tax Expense | Effective Tax Rate | |||||||||||||||
Reported(1) | $ | 133 | $ | 38 | 28.6 | % | $ | 193 | $ | 43 | 22.3 | % | |||||||||
Non-GAAP Adjustments(2) | 129 | 32 | 88 | 33 | |||||||||||||||||
Adjusted(3) | $ | 262 | $ | 70 | 26.7 | % | $ | 281 | $ | 76 | 27.0 | % |
Six Months Ended June 30, | |||||||||||||||||||||
2018 | 2017 | ||||||||||||||||||||
(in millions) | Pre-Tax Income | Income Tax Expense | Effective Tax Rate | Pre-Tax Income | Income Tax Expense | Effective Tax Rate | |||||||||||||||
Reported(1) | $ | 267 | $ | 78 | 29.2 | % | $ | 177 | $ | 19 | 10.7 | % | |||||||||
Non-GAAP Adjustments(2) | 232 | 59 | 293 | 92 | |||||||||||||||||
Remeasurement of unrecognized tax positions | — | — | — | 16 | |||||||||||||||||
Adjusted(3) | $ | 499 | $ | 137 | 27.5 | % | $ | 470 | $ | 127 | 27.0 | % |
(1) | Pre-Tax Income and Income Tax Expense from continuing operations. |
(2) | Refer to Net Income and EPS reconciliation for details. |
(3) | The tax impact on Adjusted Pre-tax income from continuing operations is calculated under the same accounting principles applied to the As Reported Pre-tax income under ASC 740, which employs an annual effective tax rate method to the results. |
Three Months Ended June 30, | ||||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||||
(in millions) | Profit | Revenue | Margin | Profit | Revenue | Margin | ||||||||||||||||
Reported(1) | $ | 133 | $ | 2,510 | 5.3 | % | $ | 193 | $ | 2,567 | 7.5 | % | ||||||||||
Adjustments: | ||||||||||||||||||||||
Restructuring and related costs | 34 | 39 | ||||||||||||||||||||
Amortization of intangible assets | 12 | 15 | ||||||||||||||||||||
Transaction and related costs, net | 58 | — | ||||||||||||||||||||
Non-service retirement-related costs | 25 | 34 | ||||||||||||||||||||
Equity in net income of unconsolidated affiliates | 19 | 20 | ||||||||||||||||||||
Restructuring and other charges - Fuji Xerox(2) | 4 | 3 | ||||||||||||||||||||
Other expenses, net | 14 | 34 | ||||||||||||||||||||
Adjusted | $ | 299 | $ | 2,510 | 11.9 | % | $ | 338 | $ | 2,567 | 13.2 | % |
Six Months Ended June 30, | ||||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||||
(in millions) | Profit | Revenue | Margin | Profit | Revenue | Margin | ||||||||||||||||
Reported(1) | $ | 267 | $ | 4,945 | 5.4 | % | $ | 177 | $ | 5,021 | 3.5 | % | ||||||||||
Adjustments: | ||||||||||||||||||||||
Restructuring and related costs | 62 | 157 | ||||||||||||||||||||
Amortization of intangible assets | 24 | 29 | ||||||||||||||||||||
Transaction and related costs, net | 96 | — | ||||||||||||||||||||
Non-service retirement-related costs | 50 | 94 | ||||||||||||||||||||
Equity in net (loss) income of unconsolidated affiliates | (49 | ) | 60 | |||||||||||||||||||
Restructuring and other charges - Fuji Xerox(2) | 83 | 3 | ||||||||||||||||||||
Other expenses, net | 19 | 88 | ||||||||||||||||||||
Adjusted | $ | 552 | $ | 4,945 | 11.2 | % | $ | 608 | $ | 5,021 | 12.1 | % |
(1) | Pre-Tax Income and revenue from continuing operations. |
(2) | Other charges in 2018 represent costs associated with the terminated combination transaction. |
(a) | Sales of Unregistered Securities during the Quarter ended June 30, 2018 |
a. | Securities issued on April 30, 2018: Registrant issued 3,118 DSUs, representing the right to receive shares of common stock, par value $1 per share, at a future date. |
b. | No underwriters participated. The shares were issued to each of the non-employee Directors of Registrant: Gregory Q. Brown, Jonathan Christodoro, Joseph J. Echevarria, Richard J. Harrington, William Curt Hunter, Robert J. Keegan, Cheryl Gordon Krongard, Charles Prince, Ann N. Reese, Stephen H. Rusckowski and Sara Martinez Tucker. |
c. | The DSUs were issued at a deemed purchase price of $28.86 per DSU (aggregate price $89,985), based upon the market value on the date of record, in payment of the dividend equivalents due to DSU holders pursuant to Registrant’s 2004 Equity Compensation Plan for Non-Employee Directors. |
d. | Exemption from registration under the Act was claimed based upon Section 4(2) as a sale by an issuer not involving a public offering. |
(b) | Issuer Purchases of Equity Securities during the Quarter ended June 30, 2018 |
Total Number of Shares Purchased | Average Price Paid per Share(2) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum That May Be Purchased under the Plans or Programs | |||||||
April 1 through 30 | 7,764 | $ | 28.78 | n/a | n/a | |||||
May 1 through 31 | — | — | n/a | n/a | ||||||
June 1 through 30 | — | — | n/a | n/a | ||||||
Total | 7,764 |
(1) | These repurchases are made under a provision in our restricted stock compensation programs for the indirect repurchase of shares through a net-settlement feature upon the vesting of shares in order to satisfy minimum statutory tax-withholding requirements. |
(2) | Exclusive of fees and costs. |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase. | |
101.INS | XBRL Instance Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase. | |
101.SCH | XBRL Taxonomy Extension Schema Linkbase. |
XEROX CORPORATION (Registrant) | |
By: | /S/ JOSEPH H. MANCINI, JR. |
Joseph H. Mancini, Jr. Vice President and Chief Accounting Officer (Principal Accounting Officer) |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase. | |
101.INS | XBRL Instance Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase. | |
101.SCH | XBRL Taxonomy Extension Schema Linkbase. |
Xerox Corporation |
201 Merritt 7 |
Norwalk, CT 06851 |
Attention: "General Counsel" |
By: | /s/ D.H. Marshall |
Name: | Douglas H. Marshall |
Title: | Assistant Secretary |
Filer: | Xerox Corporation |
201 Merritt 7 | |
P.O. Box 4505 | |
Norwalk, Connecticut 06851 |
(1) | surrender the shares of Series B Preferred Stock to the Corporation; |
(2) | if required, furnish appropriate endorsements and transfer documents; and |
(3) | if required, pay all transfer or similar taxes. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Record Date for such dividend or distribution; |
CR1 | = | the Conversion Rate in effect immediately after the Record Date for such dividend or distribution; |
OS0 | = | the number of shares of Common Stock Outstanding at the Close of Business on the Record Date for such dividend or distribution; and |
OS1 | = | the number of shares of Common Stock that would be outstanding immediately after, and solely as a result of, such dividend or distribution. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the effective date of such subdivision or combination; |
CR1 | = | the Conversion Rate in effect immediately after the effective date of such subdivision or combination; |
OS0 | = | the number of shares of Common Stock Outstanding at the Close of Business on the effective date of such subdivision or combination; and |
OS1 | = | the number of shares of Common Stock that would be outstanding immediately after, and solely as a result of, such subdivision or combination. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Record Date for such distribution; |
CR' | = | the Conversion Rate in effect immediately after the Record Date for such distribution; |
OS0 | = | the number of shares of Common Stock Outstanding at the Close of Business on the Record Date for such distribution; |
X | = | the total number of shares of Common Stock issuable pursuant to such rights or warrants; and |
Y | = | the number of shares of Common Stock equal to (x) the aggregate price payable to exercise such rights or warrants divided by (y) the Current Market Price of the Common Stock. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Record Date for such distribution; |
CR' | = | the Conversion Rate in effect immediately after the Record Date for such distribution; |
SP0 | = | the Current Market Price of the Common Stock; and |
FMV | = | the Fair Market Value on the Record Date for such distribution of the Distributed Property, expressed as amount per share of Common Stock. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Record Date for such distribution; |
CR' | = | the Conversion Rate in effect immediately after the Record Date for such distribution; |
FMV | = | the average of the Closing Prices of the capital stock or similar equity interest distributed to holders of Common Stock applicable to one share of Common Stock over the 10 consecutive Trading Day period beginning on, and including, the effective date of the Spin-Off (the “Spin-Off Valuation Period”); and |
MP0 | = | the average of the Closing Prices of the Common Stock over the Spin-Off Valuation Period. |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Record Date for such dividend or distribution; |
CR1 | = | the Conversion Rate in effect immediately after the Record Date for such dividend or distribution; |
SP0 | = | the Current Market Price of the Common Stock; and |
DIV | = | the amount in cash per share of Common Stock of the dividend or distribution, as determined pursuant to the following sentences. If any adjustment is required to be made as set forth in this Subdivision 13(j)(vi) as a result of a distribution (1) that is a regularly scheduled quarterly dividend, such adjustment would be based on the amount by which such dividend exceeds the Dividend Threshold Amount or (2) that is not a regularly scheduled quarterly dividend, such adjustment would be based on the full amount of such distribution. The Dividend Threshold Amount is subject to adjustment on an inversely proportional basis whenever the Conversion Rate is adjusted; provided that no adjustment shall be made to the Dividend Threshold Amount for any adjustment made to the Conversion Rate as described under this Subdivision 13(j)(vi). |
CR0 | = | the Conversion Rate in effect at the Close of Business on the Expiration Date; |
CR1 | = | the Conversion Rate in effect immediately after the Expiration Date; |
FMV | = | the Fair Market Value, on the Expiration Date, of the aggregate value of all cash and any other consideration paid or payable for shares of Common Stock validly tendered or exchanged and not withdrawn as of the Expiration Date; |
OS1 | = | the number of shares of Common Stock outstanding immediately after the last time tenders or exchanges may be made pursuant to such tender offer or exchange offer (the “Expiration Time”); |
OS0 | = | the number of shares of Common Stock outstanding immediately prior to the Expiration Time; and |
SP1 | = | the average of the Closing Price of Common Stock during the ten consecutive Trading Day period commencing on the Trading Day immediately after the Expiration Date. |
Make-Whole Acquisition Stock Price | |||||
Make-Whole Acquisition Effective Date | $6.00 | $6.68 | $8.00 | $9.00 | $9.75 |
February 1, 2015 and thereafter | 16.8550 | 12.6052 | 6.5538 | 3.2978 | 0.0000 |
XEROX CORPORATION |
201 Merritt 7 |
Norwalk, CT 06851 |
Attention: General Counsel |
Signed on August 1, 2018 |
/s/ D.H. Marshall |
Douglas H. Marshall |
Assistant Secretary |
Filer: | Xerox Corporation | |
201 Merritt 7 | ||
Norwalk, CT 06851 |
Restricted Stock: |
XEROX CORPORATION | ||
By: ____________________________ | ||
Name: __________________________ | ||
Title: ___________________________ |
GRANTEE: | ||
_______________________________ |
(i) | an award of 269,314 options (the “Options”) to purchase shares of the Company's common stock, $1.00 par value (the “Common Stock”) at a purchase price of $28.51 per share, the closing price of the Common Stock on the Grant Date, pursuant to that certain award agreement and award summary, dated May 15, 2018 (together, the “Option Agreement”); and |
(ii) | an award of 167,164 performance share units (the “PSUs”) and 87,689 restricted stock units (the “RSUs”) pursuant to that certain award agreement and award summary, dated May 15, 2018 (together, the “PSU/RSU Agreement”); |
1. | Notwithstanding any contrary provision in the Plan, the Option Agreement and the PSU/RSU Agreement, as applicable, in the event that (i) the Executive voluntarily terminates his employment for Good Reason prior to the occurrence of a Change in Control, or (ii) the Company involuntarily terminates the Executive's employment without Cause prior to the occurrence of a Change in Control, the number of the Executive's outstanding Options, RSUs and PSUs, as applicable, that would have otherwise become vested during the twenty-four (24) month period following such |
2. | Notwithstanding any contrary provision in the Plan, the Option Agreement or the |
3. | Except as set forth in this Amendment, the Option Agreement and PSU/RSU Agreement, as applicable, shall remain in full force and effect. |
XEROX CORPORATION | ||
By: | /s/ Darrell Ford | |
Title: | Chief Human Resources Officer | |
Date: | June 1, 2018 |
GIOVANNI VISENTIN | ||
By: | /s/ Giovanni Visentin | |
Date: | June 1, 2018 |
President, Chief Operations Officer | |
Executive Vice President (President, North American Operations) | |
Executive Vice President and CHRO | |
Executive Vice President and Chief Financial Officer | |
Executive Vice President (President, International Operations) | |
Senior Vice President (Chief Technology Officer) | |
Senior Vice President (Chief Delivery Officer) | |
Senior Vice President and Chief Strategy & Marketing Officer | |
Vice President and Chief Accounting Officer | |
Vice President and Treasurer | |
Vice President, Worldwide Tax | |
Vice President and Controller |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Fixed Charges: | ||||||||||||||||
Interest expense(1) | $ | 61 | $ | 57 | $ | 126 | $ | 126 | ||||||||
Capitalized interest | — | — | — | — | ||||||||||||
Portion of rental expense which represents interest factor | 13 | 15 | 28 | 28 | ||||||||||||
Total Fixed Charges | $ | 74 | $ | 72 | $ | 154 | $ | 154 | ||||||||
Earnings Available for Fixed Charges: | ||||||||||||||||
Pre-tax income | $ | 133 | $ | 193 | $ | 267 | $ | 177 | ||||||||
Add: Distributed equity income of affiliated companies | 3 | 30 | 3 | 30 | ||||||||||||
Add: Fixed charges | 74 | 72 | 154 | 154 | ||||||||||||
Less: Capitalized interest | — | — | — | — | ||||||||||||
Less: Net income attributable to noncontrolling interests | (2 | ) | (4 | ) | (5 | ) | (6 | ) | ||||||||
Total Earnings Available for Fixed Charges | $ | 208 | $ | 291 | $ | 419 | $ | 355 | ||||||||
Ratio of Earnings to Fixed Charges | 2.81 | 4.04 | 2.72 | 2.31 | ||||||||||||
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends: | ||||||||||||||||
Fixed Charges: | ||||||||||||||||
Interest expense(1) | $ | 61 | $ | 57 | $ | 126 | $ | 126 | ||||||||
Capitalized interest | — | — | — | — | ||||||||||||
Portion of rental expense which represents interest factor | 13 | 15 | 28 | 28 | ||||||||||||
Total Fixed charges before preferred stock dividends pre-tax income requirements | 74 | 72 | 154 | 154 | ||||||||||||
Preferred stock dividends pre-tax income requirements | 5 | 6 | 10 | 12 | ||||||||||||
Total Combined Fixed Charges and Preferred Stock Dividends | $ | 79 | $ | 78 | $ | 164 | $ | 166 | ||||||||
Earnings Available for Fixed Charges: | ||||||||||||||||
Pre-tax income | $ | 133 | $ | 193 | $ | 267 | $ | 177 | ||||||||
Add: Distributed equity income of affiliated companies | 3 | 30 | 3 | 30 | ||||||||||||
Add: Fixed charges before preferred stock dividends | 74 | 72 | 154 | 154 | ||||||||||||
Less: Capitalized interest | — | — | — | — | ||||||||||||
Less: Net income attributable to noncontrolling interests | (2 | ) | (4 | ) | (5 | ) | (6 | ) | ||||||||
Total Earnings Available for Fixed Charges and Preferred Stock Dividends | $ | 208 | $ | 291 | $ | 419 | $ | 355 | ||||||||
Ratio of Earnings to Fixed Charges and Preferred Stock Dividends | 2.63 | 3.73 | 2.55 | 2.14 |
1. | I have reviewed this Quarterly Report on Form 10-Q of Xerox Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/S/ GIOVANNI VISENTIN | |
Giovanni Visentin Principal Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Xerox Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/S/ WILLIAM F. OSBOURN, JR. | |
William F. Osbourn, Jr. Principal Financial Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/S/ GIOVANNI VISENTIN | |
Giovanni Visentin Chief Executive Officer | |
August 2, 2018 | |
/S/ WILLIAM F. OSBOURN, JR. | |
William F. Osbourn, Jr. Chief Financial Officer | |
August 2, 2018 |
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Document And Entity Information |
6 Months Ended |
---|---|
Jun. 30, 2018
shares
| |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Xerox Corporation |
Entity Central Index Key | 0000108772 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2018 |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | Q2 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 255,101,733 |
Condensed Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||
Statement of Comprehensive Income [Abstract] | |||||||
Net Income | $ 114 | $ 170 | $ 140 | $ 212 | |||
Less: Net income attributable to noncontrolling interests | 2 | 4 | 5 | 6 | |||
Net Income Attributable to Xerox | 112 | 166 | 135 | 206 | |||
Other Comprehensive (Loss) Income, Net | |||||||
Translation adjustments, net | [1] | (322) | 204 | (146) | 337 | ||
Unrealized (losses) gains, net | [1] | (3) | (14) | 14 | (6) | ||
Changes in defined benefit plans, net | [1] | 90 | (29) | 108 | (3) | ||
Other Comprehensive (Loss) Income, Net | [1] | (235) | 161 | (24) | 328 | ||
Less: Other comprehensive income, net attributable to noncontrolling interests | 0 | 0 | 0 | 1 | |||
Other Comprehensive (Loss) Income, Net Attributable to Xerox | (235) | 161 | (24) | 327 | |||
Comprehensive (Loss) Income, Net | |||||||
Comprehensive (Loss) Income, Net | (121) | 331 | 116 | 540 | |||
Less: Comprehensive income, net attributable to noncontrolling interests | 2 | 4 | 5 | 7 | |||
Comprehensive (Loss) Income, Net Attributable to Xerox | $ (123) | $ 327 | $ 111 | $ 533 | |||
|
Condensed Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Assets | ||
Cash and cash equivalents | $ 1,263 | $ 1,293 |
Accounts receivable, net | 1,297 | 1,357 |
Billed portion of finance receivables, net | 100 | 112 |
Finance receivables, net | 1,240 | 1,317 |
Inventories | 947 | 915 |
Other current assets | 233 | 236 |
Total current assets | 5,080 | 5,230 |
Finance receivables due after one year, net | 2,183 | 2,323 |
Equipment on operating leases, net | 438 | 454 |
Land, buildings and equipment, net | 564 | 629 |
Investments in affiliates, at equity | 1,344 | 1,404 |
Intangible assets, net | 244 | 268 |
Goodwill | 3,897 | 3,930 |
Deferred tax assets | 917 | 1,026 |
Other long-term assets | 889 | 682 |
Total Assets | 15,556 | 15,946 |
Liabilities and Equity | ||
Short-term debt and current portion of long-term debt | 412 | 282 |
Accounts payable | 1,153 | 1,108 |
Accrued compensation and benefits costs | 357 | 444 |
Accrued expenses and other current liabilities | 832 | 907 |
Total current liabilities | 2,754 | 2,741 |
Long-term debt | 4,813 | 5,235 |
Pension and other benefit liabilities | 1,502 | 1,595 |
Post-retirement medical benefits | 650 | 662 |
Other long-term liabilities | 215 | 206 |
Total Liabilities | 9,934 | 10,439 |
Commitments and Contingencies (See Note 18) | ||
Convertible Preferred Stock | 214 | 214 |
Common stock | 255 | 255 |
Additional paid-in capital | 3,920 | 3,893 |
Retained earnings | 4,974 | 4,856 |
Accumulated other comprehensive loss | (3,772) | (3,748) |
Xerox shareholders’ equity | 5,377 | 5,256 |
Noncontrolling interests | 31 | 37 |
Total Equity | 5,408 | 5,293 |
Total Liabilities and Equity | $ 15,556 | $ 15,946 |
Shares of common stock issued and outstanding (in shares) | 255,102 | 254,613 |
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Cash Flows from Operating Activities | ||||
Net Income | $ 114 | $ 170 | $ 140 | $ 212 |
Loss from discontinued operations, net of tax | 0 | 0 | 0 | 6 |
Income from continuing operations | 114 | 170 | 140 | 218 |
Adjustments required to reconcile Net income to Cash flows from operating activities | ||||
Depreciation and amortization | 139 | 135 | 278 | 268 |
Provisions | 23 | 17 | 40 | 35 |
Net gain on sales of businesses and assets | (16) | (1) | (32) | (1) |
Undistributed equity in net income of unconsolidated affiliates | (16) | 10 | 52 | (30) |
Stock-based compensation | 13 | 12 | 29 | 25 |
Restructuring and asset impairment charges | 34 | 32 | 62 | 140 |
Payments for restructurings | (37) | (66) | (91) | (124) |
Defined benefit pension cost | 26 | 37 | 53 | 99 |
Contributions to defined benefit pension plans | (37) | (23) | (75) | (46) |
(Increase) decrease in accounts receivable and billed portion of finance receivables | (10) | (63) | 36 | (140) |
Decrease (increase) in inventories | 16 | (30) | (71) | (88) |
Increase in equipment on operating leases | (63) | (50) | (119) | (102) |
Decrease in finance receivables | 57 | 69 | 142 | 134 |
Decrease (increase) in other current and long-term assets | 37 | 14 | 19 | (43) |
Decrease in accounts payable and accrued compensation | (70) | (21) | (58) | 0 |
Decrease in other current and long-term liabilities | (5) | (6) | (4) | (7) |
Net change in income tax assets and liabilities | 28 | 5 | 41 | (36) |
Net change in derivative assets and liabilities | (17) | 44 | (23) | 99 |
Other operating, net | 19 | (4) | 32 | 12 |
Net cash provided by operating activities of continuing operations | 235 | 281 | 451 | 413 |
Net cash used in operating activities of discontinued operations | 0 | (15) | 0 | (95) |
Net cash provided by operating activities | 235 | 266 | 451 | 318 |
Cash Flows from Investing Activities | ||||
Cost of additions to land, buildings, equipment and software | (32) | (21) | (50) | (47) |
Proceeds from sales of land, buildings and equipment | 16 | 0 | 32 | 1 |
Acquisitions, net of cash acquired | 0 | (65) | 0 | (76) |
Collections of deferred proceeds from sales of receivables | 0 | 51 | 0 | 99 |
Collections on beneficial interest from sales of finance receivables | 0 | 5 | 0 | 11 |
Other investing, net | 1 | 0 | 1 | (29) |
Net cash used in investing activities | (15) | (30) | (17) | (41) |
Cash Flows from Financing Activities | ||||
Net (payments) proceeds on short-term debt | 0 | 0 | (1) | 1 |
Proceeds from issuance of long-term debt | 3 | 2 | 5 | 5 |
Payments on long-term debt | (272) | (2) | (310) | (1,330) |
Dividends | (68) | (68) | (135) | (155) |
Other financing, net | (2) | (12) | (15) | 141 |
Net cash used in financing activities | (339) | (80) | (456) | (1,338) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (28) | 27 | (19) | 36 |
(Decrease) increase in cash, cash equivalents and restricted cash | (147) | 183 | (41) | (1,025) |
Cash, cash equivalents and restricted cash at beginning of period | 1,474 | 1,194 | 1,368 | 2,402 |
Cash, Cash Equivalents and Restricted Cash at End of Period | $ 1,327 | $ 1,377 | $ 1,327 | $ 1,377 |
Basis of Presentation Basis of Presentation |
6 Months Ended |
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Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | Basis of Presentation References herein to “we,” “us,” “our,” the “company” and “Xerox” refer to Xerox Corporation and its consolidated subsidiaries unless the context suggests otherwise. We have prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with the accounting policies described in our 2017 Annual Report on Form 10-K ("2017 Annual Report") except as noted herein, and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. You should read these Condensed Consolidated Financial Statements in conjunction with the Consolidated Financial Statements included in our 2017 Annual Report. In our opinion, all adjustments, which are necessary for a fair statement of financial position, operating results and cash flows for the interim periods presented, have been made. These adjustments consist of normal recurring items. Interim results of operations are not necessarily indicative of the results of the full year. For convenience and ease of reference, we refer to the financial statement caption “Income before Income Taxes and Equity Income” as “pre-tax income.” |
Adoption of New Revenue Recognition Standard |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adoption of New Revenue Recognition Standard | Adoption of New Revenue Recognition Standard Adoption Summary: On January 1, 2018, we adopted ASU 2014-09, Revenue from Contracts with Customers (ASC Topic 606), which superseded nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASC Topic 606 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASC Topic 606 defines a five-step process to recognize revenue and requires more judgment and estimates within the revenue recognition process than required under previous U.S. GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. We adopted this standard using the modified retrospective method of adoption. Under ASC Topic 606, based on the nature of our contracts and consistent with prior practice, we recognize revenue upon invoicing the customer for the large majority of our revenue. Additionally, the unit of accounting, that is, the identification of performance obligations, is consistent with prior revenue recognition practice. Accordingly, the adoption of this standard did not have a material impact for the large majority of our revenues. Lastly, a significant portion of our Equipment sales are either recorded as sales-type leases or through direct sales to distributors and resellers and these revenue streams are not impacted by the adoption of ASC Topic 606. The only change of significance identified in our adoption involves a change in the classification of certain revenues that were previously reported in Services revenues. These revenues, which are approximately $50 annually, relate to certain analyst services performed in connection with the installation of equipment that are being considered part of the equipment sale performance obligation in 2018. Accordingly, in 2018 these revenues are now reported as part of Sales. As a result of this change, $9 and $20 of revenue was recorded, for the three and six months ended June 30, 2018, respectively, as Sales, which would have been previously recorded as Services revenue in prior periods. Another change identified upon adoption was with respect to deferred contract costs, which include incremental costs of obtaining a contract and costs to fulfill a contract. Deferred contract costs had been minimal under our prior practices as most costs to obtain a contract and fulfill a contract were expensed as incurred. However, as a result of the contract cost guidance included in ASC Topic 606 and ASC Topic 340-40 "Contracts with Customers", upon adoption, we recorded a transition asset of $153, and a net of tax increase of $117 to Retained earnings, related to the incremental cost to obtain contracts. Substantially all of this adjustment is related to the deferral of sales commissions paid to sales people and agents in connection with the placement of equipment with post sale service arrangements. The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:
____________
Revenue Recognition Summary: We generate revenue through the sale of equipment, supplies and maintenance and printing services. Revenue is measured based on consideration specified in a contract with a customer and is recognized when we satisfy a performance obligation by transferring control of a product to a customer or in the period the customer benefits from the service. With the exception of our sales-type lease arrangements, our invoices to the customer, which normally have short-term payment terms, are typically aligned to the transfer of goods or as services are rendered to our customers and therefore in most cases we recognize revenue based on our right to invoice customers. As a result of the application of this practical expedient for the substantial portion of our revenue, the disclosure of the value of unsatisfied performance obligations for our services is not required. Significant judgments primarily include the identification of performance obligations in our Document management services arrangements as well the pattern of delivery for those services. More specifically, revenue related to our products and services is generally recognized as follows: Equipment: Revenues from the sale of equipment directly to end customers, including those from sales-type leases (see below), are recognized when obligations under the terms of a contract with our customer are satisfied and control has been transferred to the customer. For equipment placements that require us to install the product at the customer location, revenue is normally recognized when the equipment has been delivered and installed at the customer location. Sales of customer installable products are recognized upon shipment or receipt by the customer according to the customer's shipping terms. Revenue from the equipment performance obligation also includes certain analyst training services performed in connection with the installation or delivery of the equipment. Maintenance services: We provide maintenance agreements on our equipment that include service and supplies for which the customer may pay a base minimum plus a price-per-page charge for usage. In arrangements that include minimums, those minimums are normally set below the customer’s estimated page volumes and are not considered substantive. These agreements are sold as part of a bundled lease arrangement or through distributors and resellers. We normally account for these maintenance agreements as a single performance obligation for printing services being delivered in a series with delivery being measured by usage as billed to the customer. Accordingly, revenue on these agreements are normally recognized as billed to the customer over the term of the agreements based on page volumes. A substantial portion of our products are sold with full service maintenance agreements, accordingly, other than the product warranty obligations associated with certain of our entry level products, we do not have any significant warranty obligations, including any obligations under customer satisfaction programs. Document management services: Revenues associated with our document management services are generally recognized as printing services are rendered, which is generally on the basis of the number of images produced. Revenues on unit-price contracts are recognized at the contractual selling prices as work is completed by the customer. We account for these arrangements as a single performance obligation for printing services being delivered in a series with delivery being measured by usage as billed to the customer. Our services contracts may also include the sale or lease of equipment and software. In these instances, we follow the policies noted for Equipment or Software Revenues and separately report the revenue associated with these performance obligations. Certain document management services arrangements may also include an embedded lease of equipment. In these instances, the revenues associated with the lease are recognized in accordance with the requirements for lease accounting. Sales to distributors and resellers: We utilize distributors and resellers to sell our equipment, supplies and maintenance services to end-user customers. We refer to our distributor and reseller network as our two-tier distribution model. Revenues on sales to distributors and resellers are generally recognized when products are shipped to such distributors and resellers. However, revenue is only recognized when the distributor or reseller has economic substance apart from the Company such that collectability is probable and we have no further obligations related to bringing about the resale, delivery or installation of the product that would impact transfer of control. Revenues associated with maintenance agreements sold through distributors and resellers to end customers are recognized in a consistent manner to maintenance services. Revenue that may be subject to a reversal of revenue due to contractual terms or uncertainties is not recorded as revenue until the contractual provisions lapse or the uncertainties are resolved. Distributors and resellers participate in various rebate, price-protection, cooperative marketing and other programs, and we estimate the variable consideration associated with these programs and record those amounts as a reduction to revenue when the sales occur. Similarly, we account for our estimates of sales returns and other allowances when the sales occur based on our historical experience. In certain instances, we may provide lease financing to end-user customers who purchased equipment we sold to distributors or resellers. We are not obligated to provide financing and we compete with other third-party leasing companies with respect to the lease financing provided to these end-user customers. Bundled Lease Arrangements: A significant portion of our direct sales of equipment to end customers are made through bundled lease arrangements, which typically include equipment, maintenance and financing components for which the customer pays a single negotiated fixed minimum monthly payment for all elements over the contractual lease term. These arrangements also typically include an incremental, variable component for page volumes in excess of contractual page volume minimums, which are often expressed in terms of price-per-page. The fixed minimum monthly payments are multiplied by the number of months in the contract term to arrive at the total fixed minimum payments that the customer is obligated to make (fixed payments) over the lease term. In applying our lease accounting methodology, we only consider the fixed payments for purposes of allocating to the relative fair value elements of the contract. Revenues under bundled arrangements are allocated considering the relative standalone selling prices of the lease and non-lease deliverables included in the bundled arrangement. Lease deliverables include the equipment, financing, maintenance and other executory costs, while non-lease deliverables generally consist of the supplies and non-maintenance services. The allocation for the lease deliverables begins by allocating revenues to the maintenance and other executory costs plus a profit thereon. These elements are generally recognized over the term of the lease as service revenue. The remaining amounts are allocated to the equipment and financing elements, which are subjected to the accounting estimates noted below under “Leases”. Leases: The two primary lease accounting provisions we assess for the classification of transactions as sales-type or operating leases are: (1) a review of the lease term to determine if it is equal to or greater than 75% of the economic life of the equipment and (2) a review of the present value of the minimum lease payments to determine if they are equal to or greater than 90% of the fair market value of the equipment at the inception of the lease. Equipment placements included in arrangements meeting these conditions are accounted for as sales-type leases and revenue is recognized as noted above for Equipment. Equipment placements included in arrangements that do not meet these conditions are accounted for as operating leases and revenue is recognized over the term of the lease. We consider the economic life of most of our products to be five years, since this represents the most frequent contractual lease term for our principal products and only a small percentage of our leases are for original terms longer than five years. There is no significant after-market for our used equipment. We believe five years is representative of the period during which the equipment is expected to be economically usable, with normal service, for the purpose for which it is intended. Residual values are not significant. With respect to fair value, we perform an analysis of equipment fair value based on cash selling prices during the applicable period. The cash selling prices are compared to the range of values determined for our leases. The range of cash selling prices must be reasonably consistent with the lease selling prices in order for us to determine that such lease prices are indicative of fair value. Our lease pricing interest rates, which are used in determining customer payments in a bundled lease arrangement, are developed based upon a variety of factors including local prevailing rates in the marketplace and the customer’s credit history, industry and credit class. We reassess our pricing interest rates quarterly based on changes in the local prevailing rates in the marketplace. These interest rates have generally been adjusted if the rates vary by 25 basis points or more, cumulatively, from the rate last in effect. The pricing interest rates generally equal the implicit rates within the leases, as corroborated by our comparisons of cash to lease selling prices. Software: Most of our equipment has both software and non-software components that function together to deliver the equipment's essential functionality and therefore they are accounted for together as part of Equipment sales revenues. Software accessories sold in connection with our Equipment sales, as well as free-standing software sales are accounted for as separate performance obligations if determined to be material in relation to the overall arrangement. Revenue from software is not a significant component of our Total revenues. Supplies: Supplies revenue is recognized upon transfer of control to the customer, generally upon utilization or shipment to the customer in accordance with the sales contract terms. Financing: Finance income attributable to sales-type leases, direct financing leases and installment loans is recognized on the accrual basis using the effective interest method. Revenues disaggregated by primary geographic markets, major product lines, and sales channels are as follows:
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Other Revenue Recognition Policies Contract assets and liabilities: We normally do not have contract assets, which are primarily unbilled accounts receivable that are conditional on something other than the passage of time. Our contract liabilities, which represent billings in excess of revenue recognized, are primarily related to advanced billings for maintenance and other services to be performed and were approximately $107 and $91 at June 30, 2018 and January 1, 2018, respectively. The majority of the balance at June 30, 2018 will be amortized to revenue over approximately the next 30 months. Contract Costs: Incremental direct costs of obtaining a contract primarily include sales commissions paid to sales people and agents in connection with the placement of equipment with associated post sale services arrangements. These costs are deferred and amortized on the straight-line basis over the estimated contract term, which is currently estimated to be approximately four years. We pay commensurate sales commissions upon customer renewals, therefore our amortization period is aligned to our initial contract term. For the three and six months ended June 30, 2018, the incremental direct costs of obtaining a contract of $23 and $40, respectively, were deferred and the related amortization was $24 and $48, respectively. The balance of deferred incremental direct costs net of accumulated amortization at June 30, 2018 was $176. This amount is expected to be amortized over its estimated period of benefit, which we currently estimate to be approximately four years. We may also incur costs associated with our services arrangements to generate or enhance resources and assets that will be used to satisfy our future performance obligations included in these arrangements. These costs are considered contract fulfillment costs. These costs are amortized over the contractual service period of the arrangement to cost of services. In addition, we also provide inducements to certain customers in various forms, including contractual credits, which are capitalized and amortized as a reduction of revenue over the term of the contract. Amounts deferred associated with contract fulfillment costs and inducements were $10 at June 30, 2018. Equipment and software used in the fulfillment of service arrangements and where the Company retains control are capitalized and depreciated over the shorter of their useful life or the term of the contract if an asset is contract specific. Revenue-based Taxes: Revenue-based taxes assessed by governmental authorities that are both imposed on and concurrent with specific revenue-producing transactions, and that are collected by the Company from a customer, are excluded from revenue. The primary revenue-based taxes are sales tax and value-added tax (VAT). Shipping and Handling: Shipping and handling costs are accounted for as a fulfillment cost and are included in Cost of sales in the Condensed Consolidated Statements of Income. |
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Recent Accounting Pronouncements | Recent Accounting Pronouncements Leases In February 2016, the FASB issued ASU 2016-02, Leases, with additional amendments being issued in 2018. This update requires the recognition of right-to-use assets and lease obligations by lessees for those leases currently classified as operating leases under existing lease guidance. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Short term leases with a term of 12 months or less are not required to be recognized. The update also requires qualitative and quantitative disclosure of key information regarding the amount, timing and uncertainty of cash flows arising from leasing arrangements to increase transparency and comparability among companies. The accounting for lessors does not fundamentally change except for changes to conform and align guidance to the lessee guidance as well as to the new revenue recognition guidance in ASU 2014-09. Some of these conforming changes such as those related to the definition of minimum lease payments, may potentially result in certain lease arrangements, which are currently accounted for as operating leases, being classified and accounted for as sales-type leases with a corresponding up-front recognition of equipment sales revenue. This update is effective for our fiscal year beginning January 1, 2019. There are certain practical expedients that can be elected. On the Lessee side, a cross-functional implementation team has been established which is evaluating the lease portfolio, system, process and policy change requirements. The Company has made progress in gathering the necessary data elements for the lease population and a system provider has been selected, with system configuration and implementation underway. The company is currently evaluating the impact of the new guidance on its consolidated financial results and expects it will have a material impact on the Consolidated Statement of Financial Position. The Company is currently planning to elect the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs and is evaluating the other practical expedients available under the guidance. On the Lessor side, the Company continues to assess the potential impacts of the guidance on its lease agreements with customers, including potential changes in contracting terms, and we also expect to elect the package of practical expedients. The aggregate undiscounted value of our operating lease commitments at December 31, 2017 was approximately $450 and was primarily related to leases of facilities. Financial Instruments - Credit Losses In June 2016, the FASB issued ASU 2016-13, Financial Instruments Credit Losses - Measurement of Credit Losses on Financial Instruments, which requires measurement and recognition of expected credit losses for financial assets. The update impacts financial assets and net investment in leases that are not accounted for at fair value through Net income. This update is effective for our fiscal year beginning January 1, 2020, with early adoption permitted as of January 1, 2019. We are currently evaluating the impact of the adoption of ASU 2016-13 on our consolidated financial statements. Cash Flows In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments. This update provides specific guidance on eight cash flow classification issues where current guidance is either unclear or does not include specific requirements. We adopted ASU 2016-15 effective for our fiscal year beginning January 1, 2018. This update includes specific guidance, that requires cash collected on beneficial interests received in a sale of receivables be classified as inflows from investing activities. Formerly, those collections were reported in operating cash flows. We reported $56 and $110 of collections on beneficial interests as operating cash inflows on the Statement of Cash Flows for the three and six months ended June 30, 2017, respectively. Accordingly, since the update must be applied retrospectively, our reported 2017 operating and investing cash flows were revised in 2018 to report this amount as investing cash flows. There is no expected impact to our 2018 cash flows from this reporting change, due to the termination of all accounts receivable sales arrangements in North America and most arrangements in Europe and the final repurchase of previously sold finance receivables during the fourth quarter of 2017. The other seven issues noted in this update are not expected to have a material impact on our financial condition, results of operations or cash flows. Additionally, in November 2016 the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash. The update requires that amounts generally described as restricted cash and restricted cash equivalents should be included with Cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted ASU 2016-18 effective for our fiscal year beginning January 1, 2018 and applied it retrospectively through a revision of previously reported amounts. We held $64 and $75 of restricted cash, currently reported in Other current or long-term assets at June 30, 2018 and December 31, 2017, respectively. The changes in our restricted cash balances were primarily related to our accounts receivable sales programs, which were terminated during the fourth quarter of 2017. Accordingly, this update is not expected to have a material impact on our financial condition, results of operations or cash flows. Refer to Note 5 - Supplementary Financial Information for additional information. Retirement Benefits In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This update changes how employers that sponsor defined benefit pension plans and other postretirement plans present net periodic benefit costs in the income statement. An employer is required to report the service cost component in the same line item or items as other compensation costs arising from services rendered by the affected employees during the period. Other components of net retirement benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of Income from operations, if one is presented. We elected to report these costs as a separate item within Other expenses, net. The update also allows only the service cost component to be eligible for capitalization, when applicable. We adopted ASU 2017-07 effective for us beginning January 1, 2018. The presentation requirements of this update were required to be applied retrospectively through a revision of previously reported amounts. The requirement to limit capitalization to the service cost component was required to be applied prospectively. The adoption of this update is not expected to have a material impact on our financial condition, results of operations or cash flows. Refer to Note 14 - Employee Benefit Plans for the service cost component and other components of net retirement benefit cost. The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:
Business Combinations In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. We adopted ASU 2017-01 effective for our fiscal year beginning January 1, 2018, and the adoption did not have nor is it expected to have a material impact on our financial condition, results of operations or cash flows. Income Taxes In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other than Inventory. This update requires recognition of the income-tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. Under current GAAP, recognition of the income tax consequences for asset transfers other than inventory could not be recognized until the asset was sold to a third party. We adopted ASU 2016-16 effective for our fiscal year beginning January 1, 2018 and the adoption did not have nor is it expected to have a material impact on our financial condition, results of operations or cash flows. In February 2018, the FASB issued ASU No, 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The update allows the reclassification from Accumulated other comprehensive income to Retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act ("Tax Act") enacted in December 2017. Consequently, the update eliminates the stranded tax effects resulting from the Tax Act and will improve the usefulness of information reported to financial statement users. However, because the update only relates to the reclassification of the income tax effects of the Tax Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in Income from continuing operations is not affected. The update also requires certain disclosures about stranded tax effects. The update is effective for our fiscal year beginning January 1, 2019. Early adoption of this update is permitted, including adoption in any interim period. The update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company is currently evaluating the impact of adopting this new guidance. In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") No. 118 (as further clarified by the FASB's ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118) to provide guidance for companies that may not have completed their accounting for the income tax effects of the Tax Act. SAB No. 118 provides for a provisional one year measurement period for entities to finalize their accounting for certain income tax effects related to the Tax Act. SAB No. 118 provides guidance where: (i) the accounting for the income tax effect of the Tax Act is complete and reported in the Tax Act's enactment period, (ii) the accounting for the income tax effect of the Tax Act is incomplete and reported as provisional amounts based on reasonable estimates (to the extent determinable) subject to adjustments during a limited measurement period until complete, and (iii) accounting for the income tax effect of the Tax Act is not reasonably estimable (no related provisional amounts are reported in the enactment period) and entities would continue to apply accounting based on tax law provisions in effect prior to the Tax Act enactment until provisional amounts are reasonably estimable. SAB No. 118 requires disclosure of the reasons for incomplete accounting additional information or analysis needed, among other relevant information. During the fourth quarter 2017, we recorded an estimated non-cash provisional charge of $400 reflecting the impact associated with the provisions of the Tax Act based on currently available information. No further adjustment of that estimated provisional charge was made in the first quarter 2018, however we continue to evaluate impacts from the Tax Act and likely will do so through the expected filing of our 2017 U.S. Tax Return in the third quarter 2018. Any adjustments to these provisional amounts will be reported as a component of Income tax expense in the reporting period in which any such adjustments are determined. Derivatives In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The amendments in this update expand and refine hedge accounting for both financial and non-financial risk components, aligns the recognition and presentation of the effects of hedging instruments with the same income statement line item that the hedged item is reported and includes certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. This update is effective for our fiscal year beginning January 1, 2019, with early adoption permitted at any interim period. We are currently evaluating the impact of the adoption of ASU 2017-12 on our consolidated financial statements. Other Updates In 2018, 2017 and 2016, the FASB also issued the following Accounting Standards Updates, which did not have or are not expected to have a material impact on our financial condition, results of operations or cash flows upon adoption. Those updates are as follows:
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Divestitures | Divestitures Business Process Outsourcing (BPO) On December 31, 2016, Xerox completed the Separation of its BPO business through the Distribution of all of the issued and outstanding stock of Conduent to Xerox Corporation stockholders. As a result of the Separation and Distribution, the financial position and results of operations of the BPO business are presented as Discontinued operations and, as such, have been excluded from Continuing operations for all periods presented. The loss from operations for the six months ended June 30, 2017 primarily reflected changes in estimates of separation-related costs. Summarized financial information for our Discontinued operations is as follows:
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Supplementary Financial Information Supplementary Financial Information |
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Supplementary Financial Information | Supplementary Financial Information Cash, Cash Equivalents and Restricted Cash Cash, cash equivalents and restricted cash amounts were as follows:
Restricted cash primarily relates to escrow cash deposits made in Brazil associated with tax and labor litigation. As more fully discussed in Note 18 - Contingencies and Litigation, various litigation matters in Brazil require us to make cash deposits to escrow as a condition of continuing the litigation. Restricted cash amounts are classified in our Condensed Consolidated Balance Sheets based on when the cash is expected to be contractually or judicially released. Restricted cash was reported in the Condensed Consolidated Balance Sheets as follows:
Supplemental Cash Flow Information Summarized cash flow information is as follows:
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable, net were as follows:
Amounts to be invoiced in the subsequent quarter for current services provided are included in amounts accrued. We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. The allowance for uncollectible accounts receivable is determined principally on the basis of past collection experience as well as consideration of current economic conditions and changes in our customer collection trends. Accounts Receivable Sales Arrangements Accounts receivable sales arrangements are utilized in the normal course of business as part of our cash and liquidity management. The accounts receivable sold are generally short-term trade receivables with payment due dates of less than 60 days. During the fourth quarter 2017, we terminated all accounts receivable sales arrangements in North America and all but one arrangement in Europe. The remaining facility in Europe enables us to sell accounts receivable associated with our distributor network on an ongoing basis, without recourse. Under this arrangement, we sell our entire interest in the related accounts receivable for cash and no portion of the payment is held back or deferred by the purchaser. Of the accounts receivable sold and derecognized from our balance sheet, $131 and $161 remained uncollected as of June 30, 2018 and December 31, 2017, respectively. Accounts receivable sales were as follows:
__________________________
Finance Receivables, Net Finance Receivables – Allowance for Credit Losses and Credit Quality Finance receivables include sales-type leases, direct financing leases and installment loans arising from the marketing of our equipment. Our finance receivable portfolios are primarily in the U.S., Canada and Europe. We generally establish customer credit limits and estimate the allowance for credit losses on a country or geographic basis. Our policy and methodology used to establish our allowance for doubtful accounts has been consistently applied over all periods presented. The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:
__________________
We evaluate our customers based on the following credit quality indicators:
Credit quality indicators are updated at least annually and the credit quality of any given customer can change during the life of the portfolio. Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:
_____________________________
The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:
_____________________________ (1)Switzerland, Germany, Austria, Belgium and Holland. (2)Italy, Greece, Spain and Portugal. (3)Sweden, Norway, Denmark and Finland. |
Finance Receivables, Net |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Receivable, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance Receivables, Net | Accounts Receivable, Net Accounts receivable, net were as follows:
Amounts to be invoiced in the subsequent quarter for current services provided are included in amounts accrued. We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. The allowance for uncollectible accounts receivable is determined principally on the basis of past collection experience as well as consideration of current economic conditions and changes in our customer collection trends. Accounts Receivable Sales Arrangements Accounts receivable sales arrangements are utilized in the normal course of business as part of our cash and liquidity management. The accounts receivable sold are generally short-term trade receivables with payment due dates of less than 60 days. During the fourth quarter 2017, we terminated all accounts receivable sales arrangements in North America and all but one arrangement in Europe. The remaining facility in Europe enables us to sell accounts receivable associated with our distributor network on an ongoing basis, without recourse. Under this arrangement, we sell our entire interest in the related accounts receivable for cash and no portion of the payment is held back or deferred by the purchaser. Of the accounts receivable sold and derecognized from our balance sheet, $131 and $161 remained uncollected as of June 30, 2018 and December 31, 2017, respectively. Accounts receivable sales were as follows:
__________________________
Finance Receivables, Net Finance Receivables – Allowance for Credit Losses and Credit Quality Finance receivables include sales-type leases, direct financing leases and installment loans arising from the marketing of our equipment. Our finance receivable portfolios are primarily in the U.S., Canada and Europe. We generally establish customer credit limits and estimate the allowance for credit losses on a country or geographic basis. Our policy and methodology used to establish our allowance for doubtful accounts has been consistently applied over all periods presented. The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:
__________________
We evaluate our customers based on the following credit quality indicators:
Credit quality indicators are updated at least annually and the credit quality of any given customer can change during the life of the portfolio. Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:
_____________________________
The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:
_____________________________ (1)Switzerland, Germany, Austria, Belgium and Holland. (2)Italy, Greece, Spain and Portugal. (3)Sweden, Norway, Denmark and Finland. |
Inventories |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories The following is a summary of Inventories by major category:
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Investment in Affiliates, at Equity |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment in Affiliates, at Equity | Investment in Affiliates, at Equity Our Equity in net income (loss) of unconsolidated affiliates was as follows:
Fuji Xerox Equity in net income (loss) of Fuji Xerox is affected by certain adjustments required to reflect the deferral of profit associated with intercompany sales. These adjustments may result in recorded equity income (loss) that is different from that implied by our 25% ownership interest. In addition, the Equity in net income (loss) of Fuji Xerox for the three and six months ended June 30, 2018 includes after-tax restructuring and other charges of $4 and $83, respectively. In 2018, in connection with the completion of the audits of Fuji Xerox’s fiscal year-end financial statements as of and for the years ended March 31, 2016 and 2017, as well the review of Fuji Xerox’s unaudited interim financial statements as of and for the nine months ended December 31, 2017 and 2016, additional adjustments and misstatements were identified. These additional adjustments and misstatements were to the previously reported Net income of Fuji Xerox for the period from 2010 through 2017 and are incremental to the items that had been identified by the IIC (or Fujifilm's independent investigation committee). These incremental adjustments primarily relate to Fuji Xerox’s Asia Pacific subsidiaries and involve improper revenue recognition, including revenue associated with leasing transactions, additional provisions for bad debt allowances and other asset impairments. In certain instances, some of the adjustments related to inappropriate accounting and reporting practices in the Fuji Xerox Asia Pacific subsidiaries where previous misstatements were identified. Fuji Xerox recorded a cumulative charge of JPY 12 billion (approximately $110 based on the Yen/U.S. Dollar average exchange rate for the quarter ended March 31, 2018 of 108.07) in their net loss for the quarter ended March 31, 2018 (our first quarter 2018) related to the correction of these additional adjustments and misstatements. Our recognition of 25% of Fuji Xerox’s net loss for Xerox’s first quarter 2018 included an approximately $28 charge related to these adjustments and misstatements. We determined that the impact of the out-of-period misstatements was not material to Xerox’s consolidated financial statements for any individual prior quarter or year and the adjustment to correct the misstatements is not expected to be material to our full year 2018 results. Summarized financial information for Fuji Xerox was as follows:
_____________________________
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Restructuring Programs |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Programs | Restructuring Programs During the six months ended June 30, 2018, we recorded net restructuring and asset impairment charges of $62, which included $64 of severance costs related to headcount reductions of approximately 950 employees worldwide and $12 of lease cancellation costs. These costs were partially offset by $14 of net reversals, primarily resulting from changes in estimated reserves from prior period initiatives. Information related to restructuring program activity is outlined below:
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The following table summarizes the reconciliation to the Condensed Consolidated Statements of Cash Flows:
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Debt |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Bridge Facility Refer to Note 19 - Fuji Xerox Transaction and Recent Developments for additional information regarding the bridge loan facility that was terminated during the second quarter of 2018. Interest Expense and Income Interest expense and income were as follows:
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Financial Instruments |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | Financial Instruments Interest Rate Risk Management We use interest rate swap agreements to manage our interest rate exposure and to achieve a desired proportion of variable and fixed rate debt. These derivatives may be designated as fair value hedges or cash flow hedges depending on the nature of the risk being hedged. Fair Value Hedges As of June 30, 2018, pay variable/receive fixed interest rate swaps with notional amounts of $300 and net liability fair value of $5 were designated and accounted for as fair value hedges. The swaps were structured to hedge the fair value of related debt by converting them from fixed rate instruments to variable rate instruments. No ineffective portion was recorded to earnings for the six months ended June 30, 2018. The following is a summary of our fair value hedges at June 30, 2018:
Foreign Exchange Risk Management We are a global company that is exposed to foreign currency exchange rate fluctuations in the normal course of our business. As a part of our foreign exchange risk management strategy, we use derivative instruments, primarily forward contracts and purchased option contracts, to hedge the following foreign currency exposures, thereby reducing volatility of earnings or protecting fair values of assets and liabilities: •Foreign currency-denominated assets and liabilities
At June 30, 2018 and December 31, 2017, we had outstanding forward exchange and purchased option contracts with gross notional values of $1,925 and $1,788 respectively, with terms of less than 12 months. Approximately 85% of the contracts at June 30, 2018 mature within three months, 7% mature in three to six months and 8% in six to twelve months. The associated currency exposures being hedged at June 30, 2018 were materially consistent with our year-end currency exposures. There has not been any material change in our hedging strategy. Foreign Currency Cash Flow Hedges We designate a portion of our foreign currency derivative contracts as cash flow hedges of our foreign currency-denominated inventory purchases, sales and expenses. The net asset (liability) fair value of these contracts were $4 and $(14) as of June 30, 2018 and December 31, 2017, respectively. Summary of Derivative Instruments Fair Value The following table provides a summary of the fair value amounts of our derivative instruments:
Summary of Derivative Instruments Gains (Losses) Derivative gains (losses) affect the income statement based on whether such derivatives are designated as hedges of underlying exposures. The following is a summary of derivative gains (losses). Designated Derivative Instruments Gains (Losses) The following table provides a summary of gains (losses) on derivative instruments:
During the three and six months ended June 30, 2018 and 2017, no amount of ineffectiveness was recorded in the Condensed Consolidated Statements of Income for these designated cash flow hedges and all components of each derivative’s gain or (loss) were included in the assessment of hedge effectiveness. In addition, no amount was recorded for an underlying exposure that did not occur or was not expected to occur. As of June 30, 2018, a net after-tax gain of $2 was recorded in Accumulated other comprehensive loss associated with our cash flow hedging activity. The entire balance is expected to be reclassified into Net income within the next 12 months, providing an offsetting economic impact against the underlying anticipated transactions. Non-Designated Derivative Instruments Gains (Losses) Non-designated derivative instruments are primarily instruments used to hedge foreign currency-denominated assets and liabilities. They are not designated as hedges since there is a natural offset for the re-measurement of the underlying foreign currency-denominated asset or liability. The following table provides a summary of gains (losses) on non-designated derivative instruments:
For the three and six months ended June 30, 2018 currency (losses) gains, net were $(1) and $1, respectively. For the three and six months ended June 30, 2017 currency losses, net were $(1) and $(4), respectively. Net currency gains and losses include the mark-to-market adjustments of the derivatives not designated as hedging instruments and the related cost of those derivatives as well as the re-measurement of foreign currency-denominated assets and liabilities and are included in Other expenses, net. |
Fair Value of Financial Assets and Liabilities |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities The following table represents assets and liabilities measured at fair value on a recurring basis. The basis for the measurement at fair value in all cases is Level 2 – Significant Other Observable Inputs.
We utilize the income approach to measure the fair value for our derivative assets and liabilities. The income approach uses pricing models that rely on market observable inputs such as yield curves, currency exchange rates and forward prices, and therefore are classified as Level 2. Fair value for our deferred compensation plan investments in mutual funds is based on quoted market prices for those funds. Fair value for deferred compensation plan liabilities is based on the fair value of investments corresponding to employees’ investment selections. Summary of Other Financial Assets and Liabilities The estimated fair values of our other financial assets and liabilities were as follows:
The fair value amounts for Cash and cash equivalents and Accounts receivable, net, approximate carrying amounts due to the short maturities of these instruments. The fair value of Short-term debt, including the current portion of long-term debt, and Long-term debt was estimated based on the current rates offered to us for debt of similar maturities (Level 2). The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at such date. |
Employee Benefit Plans |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans | Employee Benefit Plans The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows:
(1)Prior year amounts have been revised to reflect additional cost for previously excluded plans.
Contributions The following table summarizes cash contributions to our defined benefit pension plans and retiree health benefit plans.
There are no mandatory contributions required in 2018 for our U.S. tax-qualified defined benefit plans to meet the minimum funding requirements, however, our estimated 2018 contributions include $50 of voluntary contributions to these plans. |
Shareholders' Equity |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity | Shareholders’ Equity (share data in thousands)
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(2)Cash dividends declared on common stock of $0.25 per share in each quarter of 2018 and 2017. (3)Cash dividends declared on preferred stock of $20.00 per share in each quarter of 2018 and 2017. (4)Refer to Note 16 - Other Comprehensive (Loss) Income for components of AOCL. Treasury Stock There were no repurchases of Xerox Common stock pursuant to Board authorized share repurchase programs during the first or second quarter of 2018. Stock-Based Compensation We have a long-term incentive plan whereby eligible employees may be granted restricted stock units (RSUs), performance shares (PSs) and/or stock options (SOs). We grant stock-based compensation awards in order to continue to attract and retain qualified employees and to better align employees' interests with those of our shareholders. Each of these awards is subject to settlement with newly issued shares of our common stock. Stock-based compensation expense was as follows:
The following is a summary of changes to our program design and performance metrics effective for our April 2018 grant, as approved by our board of directors (the "Board"). The Board also approved a change in the timing of our annual grant of awards from July to April, to better align our grant date with other annual incentive compensation payments and the underlying performance period related to PSs. We grant RSUs and PSs to officers, selected executives and middle managers, and SOs to officers and selected executives only. Restricted Stock Units Compensation expense for RSUs is based upon the grant date market price and is recognized on a straight-line basis over a three-year graded-vesting period, based on management's estimate of the number of shares expected to vest. RSUs vest on a graded schedule as follows: 25% after one year of service, 25% after two years of service, and 50% after three years of service from the date of grant. Prior to the April 2018 grant, RSUs vested on a three-year cliff basis from the date of grant. Shares awarded to employees who are retirement-eligible at the date of grant, become retirement-eligible during the vesting period, or are terminated not-for-cause (e.g. as part of a restructuring initiative), vest based on service provided from the date of grant to the date of separation on a pro-rata share of each individual graded-vesting tranche. Shares granted during the three months ended June 30, 2018 were 1,012, with a corresponding weighted average grant date fair value of $28.03 per share. Performance Shares In connection with the April 2018 grant, the Board approved the following changes to the PS performance goals: the Earnings Per Share (EPS) metric was replaced with a Total Shareholder Return (TSR) metric and the Cash Flow from Operations metric was replaced with a Free Cash Flow metric. The Board retained the Revenue metric as a performance goal as well as the three-year performance period for all measures. The performance metrics are equally weighted; accordingly, each PS grant is two-thirds performance based (revenue and free cash flow) and one-third market-based (TSR). The performance goals are independent of each other and depending on the achievement of these metrics, a recipient of a PS award is entitled to receive a number of shares equal to a percentage, ranging from 0% to 200% of the PS award granted. PSs retain the three-year cliff vesting from the date of grant. Performance-Based Component PSs vest contingent upon meeting pre-determined cumulative goals for revenue and free cash flow. The fair value of the performance-based component of our PSs is based upon the grant-date market price. Compensation expense is recognized on a straight-line basis over the vesting period, based on management's estimate of the number of shares expected to vest. If the cumulative three-year actual results exceed the stated targets, all plan participants have the potential to earn additional shares of common stock up to a maximum overachievement of 100% of the original grant. If the stated targets are not met, any recognized compensation cost would be reversed. Shares granted during the three months ended June 30, 2018 were 667, with a corresponding weighted average grant date fair value of $28.07 per share. In connection with the April 2018 grant, the Board only approved the performance measures and corresponding weightings for the 2018 performance year. The performance measures for 2019 and 2020 were expected to be determined by the Board at a later date in connection with the closing of the Fuji Xerox Transaction, which was terminated in May 2018. The Board is expected to approve measures for the 2019 and 2020 performance periods sometime during the second half of 2018. However, since the 2019 and 2020 performance measures have not been approved as of June 30, 2018, the criteria needed to establish a grant date has not been met and therefore the fair value of the April 2018 grant will continue to be revalued based on the period end stock price for each subsequent reporting period until the grant date criteria has been met. Market-Based Component The TSR metric is based on the percentage change in the Company’s stock price plus the dividends paid over the three-year measurement period. Payout for this portion of the PS will be determined based on Xerox’s percentage change compared to the shareholder returns of the peer group of companies approved by the compensation committee of the Board (as disclosed in the 2018 annual proxy statement). Since the TSR portion of the PS award represents a market condition, a Monte Carlo simulation was used to determine the grant-date fair value. A summary of the key valuation input assumptions used in the Monte Carlo simulation relative to PS awards granted were as follows:
____________
Our TSR compared to the peer group TSR will determine the payout as follows:
____________
Compensation expense is recognized on a straight-line basis over the vesting period based on the fair value determined by the Monte Carlo simulation and, except in cases of employee forfeiture, cannot be reversed regardless of performance. Shares granted during the three months ended June 30, 2018 were 333. Stock Options The Board also approved the granting of SOs as part of the 2018 plan design. Except for the conversion of options relating to our acquisition of Affiliated Computer Systems in 2010, we have not issued any SOs since 2004. Compensation expense associated with SOs is based upon the grant date fair value determined by utilizing the Black-Scholes (BS) option-pricing model and is recorded on a straight-line basis over a three-year graded-vesting period, based on management's estimate of the number of SOs expected to vest. SOs vest on a graded schedule as follows: 25% after one year of service, 25% after two years of service, and 50% after three years of service from the date of grant. Similar to RSUs, SOs awarded to employees who are retirement-eligible at the date of grant, become retirement-eligible during the vesting period, or are terminated not-for-cause, vest based on service provided from the date of grant to separation, on a pro-rata share of each individual vesting tranche. The weighted average assumptions used in the BS option-pricing model relative to SO awards were as follows:
____________
SOs granted during the three months ended June 30, 2018 were 1,317. Note: Management’s estimate of the number of shares expected to vest at the time of grant reflects an estimate for forfeitures based on our historical forfeiture rate to date. Should actual forfeitures differ from management’s estimate, the activity will be reflected in a subsequent period. |
Other Comprehensive (Loss) Income |
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Other Comprehensive Income (Loss) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive (Loss) Income | Other Comprehensive (Loss) Income Other Comprehensive (Loss) Income is comprised of the following:
_____________________________
Accumulated Other Comprehensive Loss (AOCL) AOCL is comprised of the following:
_____________________________
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Earnings per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per Share (share data in thousands) The following table sets forth the computation of basic and diluted earnings per share of common stock:
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Contingencies and Litigation |
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Jun. 30, 2018 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Contingencies and Litigation | Contingencies and Litigation Legal Matters We are involved in a variety of claims, lawsuits, investigations and proceedings concerning: securities law; governmental entity contracting; servicing and procurement law; intellectual property law; environmental law; employment law; the Employee Retirement Income Security Act (ERISA); and other laws and regulations. We determine whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. We assess our potential liability by analyzing our litigation and regulatory matters using available information. We develop our views on estimated losses in consultation with outside counsel handling our defense in these matters, which involves an analysis of potential results, assuming a combination of litigation and settlement strategies. Should developments in any of these matters cause a change in our determination as to an unfavorable outcome and result in the need to recognize a material accrual, or should any of these matters result in a final adverse judgment or be settled for significant amounts, they could have a material adverse effect on our results of operations, cash flows and financial position in the period or periods in which such change in determination, judgment or settlement occurs. Brazil Tax and Labor Contingencies Our Brazilian operations are involved in various litigation matters and have received or been the subject of numerous governmental assessments related to indirect and other taxes, as well as disputes associated with former employees and contract labor. The tax matters, which comprise a significant portion of the total contingencies, principally relate to claims for taxes on the internal transfer of inventory, municipal service taxes on rentals and gross revenue taxes. We are disputing these tax matters and intend to vigorously defend our positions. Based on the opinion of legal counsel and current reserves for those matters deemed probable of loss, we do not believe that the ultimate resolution of these matters will materially impact our results of operations, financial position or cash flows. The labor matters principally relate to claims made by former employees and contract labor for the equivalent payment of all social security and other related labor benefits, as well as consequential tax claims, as if they were regular employees. As of June 30, 2018, the total amounts related to the unreserved portion of the tax and labor contingencies, inclusive of any related interest, amounted to approximately $510, with the decrease from our December 31, 2017 balance of approximately $600, primarily related to currency, partially offset by new cases and interest. With respect to the unreserved balance of approximately $510, the majority has been assessed by management as being remote as to the likelihood of ultimately resulting in a loss to the Company. In connection with the above proceedings, customary local regulations may require us to make escrow cash deposits or post other security of up to half of the total amount in dispute. As of June 30, 2018, we had $62 of escrow cash deposits for matters we are disputing and additional letters of credit and surety bonds of $113 and $91, respectively, which include associated indexation. There were no liens on any of our Brazilian assets as of June 30, 2018. Generally, any escrowed amounts would be refundable and any liens would be removed to the extent the matters are resolved in our favor. We routinely assess all these matters as to the probability of ultimately incurring a liability against our Brazilian operations and record our best estimate of the ultimate loss in situations where we assess the likelihood of an ultimate loss as probable. Litigation Against the Company Pending Litigation Relating to the Fuji Transaction:
In February 2018, five complaints, including four putative class actions (which have been consolidated), were filed by Xerox shareholders in the Supreme Court of the State of New York, County ("Court") in connection with the proposed transaction to combine Xerox and Fuji Xerox (“Fuji Transaction”) (refer to Note 19 - Fuji Xerox Transaction and Recent Developments). All of the complaints name as defendants Xerox, its directors, and FUJIFILM Holdings Corporation (“Fujifilm”). The complaint in one of the actions also names as a defendant Ursula M. Burns, the former Chief Executive Officer of Xerox. The plaintiffs allege, among other things, that Xerox's directors breached their fiduciary duties in negotiating, approving, and purportedly making false and misleading disclosures about the Fuji Transaction, and that Fujifilm aided and abetted those breaches. The complaint in one of the actions further alleges that Xerox and the director defendants engaged in common law fraud by purportedly failing to disclose information about the joint venture agreements between Xerox and Fujifilm. The lawsuits seek injunctive relief preventing the previously proposed transactions, and/or additional disclosures by Xerox’s directors, unspecified damages from Xerox’s directors, costs and attorneys’ fees, as well as other relief. Another complaint filed by Darwin Deason, a Xerox shareholder, against Xerox and its directors in the same Court on March 2, 2018 alleged that defendants breached their fiduciary duties by refusing Mr. Deason’s request for a waiver of the deadline for nomination of a new slate of Xerox directors, and sought to enjoin Xerox and its directors from enforcing Xerox’s advance notice by-laws, thereby allowing Mr. Deason to proceed with the nominations, as well as costs, fees, and other relief. On April 27, 2018, the Court issued decisions and orders granting plaintiffs’ preliminary injunction motions, which (i) enjoin Xerox from “taking any further action to consummate the change of control transaction between Xerox and Fuji that was announced on January 31, 2018 pending a final determination of the claims asserted in the underlying action;” (ii) enjoin Xerox from enforcing its advance notice bylaw provision requiring shareholders to nominate directors for election at the 2018 annual shareholder meeting by December 11, 2017; and (iii) require Xerox to waive such advance notice bylaw provision to permit the noticing of a slate of director nominees for election at the 2018 annual shareholder meeting, and denying defendants’ motions to dismiss. On May 1, 2018, Xerox entered into a Director Appointment, Nomination and Settlement Agreement (the “Settlement Agreement”) with Carl Icahn and Darwin Deason, among others, that would have resolved the pending proxy contest in connection with Xerox’s 2018 Annual Meeting of Shareholders, as well as the ongoing litigation brought by Mr. Deason against Xerox and its directors related to the Fuji Transaction. The agreement expired by its terms on May 3, 2018 without becoming effective. On May 7, 2018, defendants filed with the Supreme Court of the State of New York, Appellate Division, First Judicial Department, notices of appeal of, and motions to stay pending appeal, the lower Court’s decision and order. Defendants also moved the appellate court for interim relief ordering that the appeal be heard on an expedited basis. At a hearing before the appellate court on May 7, 2018, the appellate court ruled that the appeals would be heard on an expedited basis and granted a partial interim stay allowing Xerox and Fujifilm to take steps to seek regulatory approvals related to the Fuji Transaction pending a ruling from the appellate court on defendants’ motions to stay pending appeal. On May 13, 2018, a settlement agreement with respect to the Deason cases was signed on behalf of plaintiff Deason, the Icahn Group and related parties, and all defendants except Fujifilm, and a memorandum of understanding regarding settlement of the putative class case was signed by all defendants except Fujifilm. Pursuant to the settlements, the settling defendants withdrew their appeal and motion to stay in the Deason cases. The settling defendants also withdrew their motion to stay in the putative class case. Fujifilm's appeal and motion for a stay of the proceedings in the first Deason case and the putative class case remain pending before the Appellate Division. The Court entered a stipulation of discontinuance as to the settling parties in the second Deason case on May 14, 2018, and agreed on June 22, 2018 to do the same in the first Deason case. On June 14, 2018, Fujifilm filed answers in the first Deason case and the putative class case, along with cross-claims against the members of the Xerox Board (as constituted before May 13, 2018) and a third-party complaint against Xerox director Jonathan Christodoro, seeking contribution for any potential award against Fujifilm for aiding and abetting purported breaches of fiduciary duties. On June 19, 2018, the putative class plaintiffs filed a motion for preliminary approval of a stipulation of settlement that would resolve the claims asserted by the plaintiffs in the putative class case against all defendants, other than Fujifilm. Carmen Ribbe, the plaintiff in the below derivative action, and Fujifilm filed oppositions to the motion on July 10, 2018. On June 22, 2018, the Court entered an order denying a joint motion by the putative class plaintiffs and the settling defendants to dissolve the injunction in the class case as against the settling defendants, and entered an order denying Fujifilm’s motion to dissolve the injunctions in the class case and the first Deason case in their entirety. The class has not yet been certified, and preliminary approval has not been granted. Xerox will vigorously defend these lawsuits to the extent that the proceedings continue as to Xerox. At this time, however, it is premature to make any conclusion regarding the probability of incurring material losses in these lawsuits. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs.
On May 24, 2018, a shareholder derivative complaint was filed with the Court by Carmen Ribbe against all defendants in the putative class action described above, as well as Centerview Partners, LLC. Plaintiff made no pre-complaint demand. The Ribbe complaint contains allegations of breaches of fiduciary duty similar to those in the putative class complaint, and further alleges that Fujifilm and Centerview aided and abetted those breaches, and that the directors breached their fiduciary duties and wasted corporate assets by, among other things, agreeing to releases of claims against them and allowing certain alleged payments in settlement of the Deason and putative class cases. It seeks unspecified damages for Xerox, rescission or reformation of the Deason and putative class settlements, restitution of funds allegedly paid to the directors, injunctive relief against wrongful practices, costs and attorneys’ fees, as well as other relief. Xerox has not yet responded to the complaint. Xerox believes the lawsuit is meritless and will vigorously defend it. At this time, however, it is premature to make any conclusion regarding the probability of incurring material losses in this litigation. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs.
On June 18, 2018, Fujifilm filed a complaint against Xerox in the U.S. District Court for the Southern District of New York, relating to the Fuji Transaction agreements. The complaint alleges that Xerox (1) willfully breached the Fuji Transaction agreements by purporting to terminate them to appease Messrs. Icahn and Deason and using as a pretext issues with Fujifilm’s untimely submitted financials, and by settling the Deason litigation without notice to or consent by Fujifilm; (2) willfully breached the implied covenant of good faith and fair dealing by failing to support and use best efforts to conclude the Fuji Transaction, thus depriving Fujifilm of the benefit of its bargain; and (3) effected a change in Xerox’s recommendation regarding the Fuji Transaction, entitling Fujifilm to terminate the Fuji Transaction agreements and to receive from Xerox a $183 termination fee. Fujifilm seeks a judgment for damages to be determined at trial in an amount in excess of $1.0 billion plus punitive damages; a declaration regarding the alleged change in recommendation such that Fujifilm may terminate the transaction and Xerox must pay the $183 termination fee and other remedies; costs and attorneys’ fees; and other relief the court may deem appropriate. Xerox has not yet responded to the complaint. Xerox believes the lawsuit is meritless and will vigorously defend it. At this time, however, it is premature to make any conclusion regarding the probability of incurring material losses in this litigation. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs. State of Texas v. Xerox Corporation, Xerox State Healthcare, LLC, and ACS State Healthcare, LLC: On May 9, 2014, the State of Texas, via the Texas Office of Attorney General (the “State”), filed a lawsuit in the 53rd Judicial District Court of Travis County, Texas. The lawsuit alleges that Xerox Corporation, Xerox State Healthcare, LLC and ACS State Healthcare (collectively “the Defendants”) violated the Texas Medicaid Fraud Prevention Act in the administration of ACS State Healthcare’s contract with the Texas Department of Health and Human Services (“HHSC”). Xerox Corporation provided a guaranty of contractual performance with respect to the ACS State Healthcare’s contract. The State alleges that the Defendants made false representations of material facts regarding the processes, procedures, implementation and results regarding the prior authorization of orthodontic claims. The State seeks recovery of actual damages, two times the amount of any overpayments made as a result of unlawful acts, civil penalties, pre- and post-judgment interest and all costs and attorneys’ fees. The State references the amount in controversy as exceeding hundreds of millions of dollars. The Defendants filed their Answer in June 2014 denying all allegations. In August 2017, the State of Texas filed a Second Amended Petition, which makes substantially similar allegations and seeks similar remedies as the original lawsuit. On October 23, 2017, Xerox Corporation filed a Motion for Summary Judgment seeking judgment in Xerox's favor on all claims against it. On July 2, 2018, the Court denied the State of Texas’ motion for a determination of the adequacy of its pleadings as to Xerox or in the alternative, seeking leave to amend its petition to bring additional claims against Xerox. The Defendants will continue to vigorously defend themselves in this matter. This matter is a “Conduent Liability”, as defined in the Separation and Distribution Agreement dated as of December 31, 2016 between Xerox Corporation and Conduent Incorporated, for which Conduent is required to indemnify Xerox. Conduent is entitled to direct the defense of this matter. Oklahoma Firefighters Pension and Retirement System v. Xerox Corporation, Ursula M. Burns, Luca Maestri, Kathryn A. Mikells, Lynn R. Blodgett, Robert K. Zapfel, David H. Bywater and Mary Scanlon: On October 21, 2016, the Oklahoma Firefighters Pension and Retirement System (“plaintiff”) filed a purported securities class action complaint against Xerox Corporation, Ursula Burns, Luca Maestri, Kathryn Mikells, Lynn Blodgett and Robert Zapfel (collectively, “defendants”) in the U.S. District Court for the Southern District of New York on behalf of the plaintiff and certain purchasers or acquirers of Xerox common stock. The complaint alleged that defendants made false and misleading statements, in violation of Sections 10(b) and 20(a) of the Securities Exchange Act and SEC Rule 10b-5, relating to the operations and prospects of Xerox’s Health Enterprise business. Plaintiff sought, among other things, unspecified monetary damages and attorneys’ fees. Other, similar lawsuits may follow. On December 28, 2016, the Court entered a stipulated order setting out a schedule for amendment of the complaint and for defendants’ response to that complaint following the Court’s appointment of lead plaintiff under the Private Securities Litigation Reform Act. On February 28, 2017, the Court issued an opinion and order appointing the Arkansas Public Employees Retirement System ("APERS") as lead plaintiff. On May 1, 2017, APERS filed an amended complaint, alleging substantially similar claims and seeking substantially similar relief, but adding David Bywater and Mary Scanlon as defendants. On June 30, 2017, defendants moved to dismiss the amended complaint, and the motions were fully briefed on October 13, 2017. On March 20, 2018, the Court entered an opinion and order granting the motions, and on March 23, 2018, the Court entered a judgment of dismissal and closed the case. On April 20, 2018, plaintiffs filed a notice of appeal in the U.S. Court of Appeals for the Second Circuit. Xerox will vigorously defend against this matter. At this time, it is premature to make any conclusion regarding the probability of incurring material losses in this litigation. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs. Other Contingencies We have issued or provided approximately $328 of guarantees as of June 30, 2018 in the form of letters of credit or surety bonds issued to i) support certain insurance programs; ii) support our obligations related to the Brazil tax and labor contingencies; and iii) support certain contracts, primarily with public sector customers, which require us to provide a surety bond as a guarantee of our performance of contractual obligations. In general, we would only be liable for the amount of these guarantees in the event we defaulted in performing our obligations under each contract; the probability of which we believe is remote. We believe that our capacity in the surety markets as well as under various credit arrangements (including our Credit Facility) is sufficient to allow us to respond to future requests for proposals that require such credit support. Indemnifications We have indemnified, subject to certain deductibles and limits, the purchasers of businesses or divested assets for the occurrence of specified events under certain of our divestiture agreements. Where appropriate, an obligation for such indemnifications is recorded as a liability. Since the obligated amounts of these types of indemnifications are often not explicitly stated and/or are contingent on the occurrence of future events, the overall maximum amount of the obligation under such indemnifications cannot be reasonably estimated. Other than obligations recorded as liabilities at the time of divestiture, we have not historically made significant payments for these indemnifications. Additionally, under certain of our acquisition agreements, we have provided for additional consideration to be paid to the sellers if established financial targets are achieved post-closing. We have recognized liabilities for these contingent obligations based on an estimate of the fair value of these contingencies at the time of acquisition. Contingent obligations related to indemnifications arising from our divestitures and contingent consideration provided for by our acquisitions are not expected to be material to our financial position, results of operations or cash flows. |
Fuji Xerox Transaction and Recent Developments |
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Jun. 30, 2018 | |
Fuji Xerox Transaction and Recent Developments [Abstract] | |
Fuji Xerox Transaction and Recent Developments | Fuji Xerox Transaction and Recent Developments Pending Litigation Relating to the Fuji Transaction Refer to Note 18 - Contingencies and Litigation for discussion of the Pending Litigation Relating to the Fuji Xerox Transaction. Fuji Xerox Transaction Overview and Termination of Agreement On January 31, 2018, Xerox entered into (i) a Redemption Agreement with FUJIFILM Holdings Corporation, a Japanese company (“Fujifilm”), and Fuji Xerox Co., Ltd., a Japanese company, in which Xerox indirectly holds a 25% equity interest while Fujifilm holds the remaining 75% equity interest (“Fuji Xerox”), and (ii) a Subscription Agreement with Fujifilm (collectively, the “Transaction Agreements”). Under the terms of the Transaction Agreements, Fuji Xerox would have become a wholly-owned subsidiary of Xerox, Xerox shareholders would have received a $2.5 billion special cash dividend and Xerox would have become owned 49.9% by Xerox's shareholders as of the closing date for the transaction and 50.1% by Fujifilm. On May 13, 2018, prior to the entry into the Settlement Agreement discussed in Note 18 - Contingencies and Litigation, the Company delivered a written notice of termination of the Subscription Agreement to Fujifilm in accordance with the terms of the Subscription Agreement, which provided the Company with certain terminations rights, including (a) if the audited financial statements of FX deviate in any material respect from the unaudited financial statements of FX and its subsidiaries provided to the Company prior to the date of the Subscription Agreement and (b) if Fujifilm or FX fails to perform any covenant or agreement set forth in the Subscription Agreement that would cause certain conditions to the consummation of the transactions contemplated by the Subscription Agreement not to be satisfied, which breach or failure to perform cannot be cured or, if capable of cure, has not been cured by the earlier of 30 days following written notice thereof from the Company to Fujifilm. By virtue of the termination of the Subscription Agreement, the Redemption Agreement terminated automatically. The Company's termination of the Transaction Agreements is the subject of pending litigation. As a result of the failure by Fujifilm to deliver the audited financial statements of FX by April 15, 2018 and the material deviations reflected in the audited financial statements of FX, when delivered, the Company determined that it is in the best interest of the Company and its shareholders to terminate the Subscription Agreement in accordance with the termination rights set forth therein, taking into account other circumstances limiting the ability of the Company, Fujifilm and FX to consummate a transaction. The Company continues to maintain existing commercial relationships with FX and Fujifilm, including, as part of the following agreements: (i) the Joint Enterprise Contract, between the Company and Fujifilm, dated March 30, 2001, (ii) the Technology Agreement, dated April 1, 2006, by and between the Company and FX and (iii) the Master Program Agreement made and entered into as of September 9, 2013 by and between the Company and FX. On June 25, 2018, the Company disclosed to Fujifilm that it does not currently plan to renew the Technology Agreement when it expires in 2021. In addition, the Company disclosed plans that it may sell products directly into the Asia-Pacific market with sole and exclusive use of the Xerox brand name. Xerox’s goals include sourcing products, parts and supplies from the most competitive suppliers to support the needs of its customers. Bridge Facility Termination On January 31, 2018, Xerox entered into a Commitment Letter with Citigroup Global Markets Inc. and Morgan Stanley Senior Funding, Inc., which provided a commitment for a $2.5 billion unsecured bridge loan facility that would have been available for Xerox to pay the special one-time cash dividend of $2.5 billion to existing shareholders of Xerox in connection with the Transaction Agreements, as described above. Concurrent with the termination of the Transaction Agreements, the commitment to provide the unsecured bridge loan facility was terminated in the second quarter 2018 and, as a result, the remaining unamortized debt issuance costs of $16 were written-off. |
Subsequent Event Subsequent Event |
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Jun. 30, 2018 | |
Subsequent Event [Abstract] | |
Subsequent Events [Text Block] | Subsequent Event In July 2018, the Board of Directors authorized a $1.0 billion share repurchase program (exclusive of any commissions and other transaction fees and costs). This program replaces the $245 of authority remaining under the Company's previously authorized share repurchase program. |
Supplementary Financial Information Supplementary Financial Information (Policy) |
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Jun. 30, 2018 | |
Supplemental Financial Information [Abstract] | |
Restricted Cash, Policy [Policy Text Block] | Restricted cash primarily relates to escrow cash deposits made in Brazil associated with tax and labor litigation. As more fully discussed in Note 18 - Contingencies and Litigation, various litigation matters in Brazil require us to make cash deposits to escrow as a condition of continuing the litigation. Restricted cash amounts are classified in our Condensed Consolidated Balance Sheets based on when the cash is expected to be contractually or judicially released. |
Adoption of New Revenue Recognition Standard (Tables) |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:
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The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:
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Disaggregation of Revenue [Table Text Block] | Revenues disaggregated by primary geographic markets, major product lines, and sales channels are as follows:
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Recent Accounting Pronouncements Recent Accounting Pronouncements (Tables) |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:
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The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:
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Divestitures (Tables) |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Summarized Financial Information - Discontinued operations | Summarized financial information for our Discontinued operations is as follows:
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Supplementary Financial Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash, Cash Equivalents and Restricted Cash | Cash, cash equivalents and restricted cash amounts were as follows:
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Restricted Cash Balance Sheet Location [Table Text Block] | Restricted cash was reported in the Condensed Consolidated Balance Sheets as follows:
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Supplemental Cash Flow Information | Supplemental Cash Flow Information Summarized cash flow information is as follows:
__________________________
|
Accounts Receivable, Net (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accounts receivable, net | Accounts receivable, net were as follows:
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Schedule of accounts receivables sales | Accounts receivable sales were as follows:
__________________________
|
Finance Receivables, Net (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Receivable, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses on Financing Receivables | The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:
__________________
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Financing Receivable Credit Quality Indicators | Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:
_____________________________
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Finance Receivables Aging | The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:
_____________________________ (1)Switzerland, Germany, Austria, Belgium and Holland. (2)Italy, Greece, Spain and Portugal. (3)Sweden, Norway, Denmark and Finland. |
Inventories (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | The following is a summary of Inventories by major category:
|
Investment in Affiliates, at Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity in net income (loss) of unconsolidated affiliates | Our Equity in net income (loss) of unconsolidated affiliates was as follows:
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Summarized Financial Information Of Equity Investment - Fuji Xerox | Summarized financial information for Fuji Xerox was as follows:
_____________________________
|
Restructuring Programs (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Program Activity | Information related to restructuring program activity is outlined below:
____________________________
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Reconciliation to the Condensed Consolidated Statements Of Cash Flows | The following table summarizes the reconciliation to the Condensed Consolidated Statements of Cash Flows:
|
Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Interest Expense And Income | Interest expense and income were as follows:
____________
|
Financial Instruments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Derivatives | The following is a summary of our fair value hedges at June 30, 2018:
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Summary of Derivative Instruments Fair Value | The following table provides a summary of the fair value amounts of our derivative instruments:
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Summary of Gains (Losses) on Derivative Instruments | The following table provides a summary of gains (losses) on derivative instruments:
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Summary of Derivatives Not Designated as Hedging Instruments Gains (Losses) | The following table provides a summary of gains (losses) on non-designated derivative instruments:
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Fair Value of Financial Assets and Liabilities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value of financial assets and liabilities | The following table represents assets and liabilities measured at fair value on a recurring basis. The basis for the measurement at fair value in all cases is Level 2 – Significant Other Observable Inputs.
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Estimated fair values of financial assets and liabilities not measured at fair value on a recurring basis | The estimated fair values of our other financial assets and liabilities were as follows:
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Employee Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of net periodic benefit cost and other changes in plan assets and benefit obligations | The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows:
(1)Prior year amounts have been revised to reflect additional cost for previously excluded plans.
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Defined Benefit and Retiree Health Pension Plans, actual and expected cash contributions | Contributions The following table summarizes cash contributions to our defined benefit pension plans and retiree health benefit plans.
There are no mandatory contributions required in 2018 for our U.S. tax-qualified defined benefit plans to meet the minimum funding requirements, however, our estimated 2018 contributions include $50 of voluntary contributions to these plans. |
Shareholders' Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stockholders Equity | Shareholders’ Equity (share data in thousands)
_____________________________
(2)Cash dividends declared on common stock of $0.25 per share in each quarter of 2018 and 2017. (3)Cash dividends declared on preferred stock of $20.00 per share in each quarter of 2018 and 2017. (4)Refer to Note 16 - Other Comprehensive (Loss) Income for components of AOCL. |
Shareholders' Equity Share-Based Compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Compensation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based Compensation Expense, Tax Effect | Stock-based compensation expense was as follows:
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Schedule Of Share Based Payment Award Valuation Assumptions, Performance Shares, Market-Based Component Table [Table Text Block] | A summary of the key valuation input assumptions used in the Monte Carlo simulation relative to PS awards granted were as follows:
____________
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TSR Payout as a Percentage, Comparison to Peer Group [Table Text Block] | Our TSR compared to the peer group TSR will determine the payout as follows:
____________
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Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | The weighted average assumptions used in the BS option-pricing model relative to SO awards were as follows:
____________
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Other Comprehensive (Loss) Income (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive Income (Loss) [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Comprehensive (Loss) Income | Other Comprehensive (Loss) Income is comprised of the following:
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Schedule of Accumulated Other Comprehensive Loss | AOCL is comprised of the following:
_____________________________
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Earnings per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Earnings per Share | The following table sets forth the computation of basic and diluted earnings per share of common stock:
|
Adoption of New Revenue Recognition Standard - Additional Information (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jan. 01, 2018 |
||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Equipment sale performance obligation | $ 50 | $ 50 | ||||||||
Total Revenues | [1] | 2,510 | $ 2,567 | 4,945 | $ 5,021 | |||||
Transition asset | 153 | |||||||||
Increase to retained earnings | [2] | $ 120 | ||||||||
Economic life of leased product | 5 years | |||||||||
Lessor, Operating Lease, Term of Contract | 5 years | |||||||||
Contract liabilities | 107 | $ 107 | $ 91 | |||||||
Contract liability amortization period | 30 months | |||||||||
Incremental direct costs of obtaining a contract | 23 | $ 40 | ||||||||
Capitalized contract costs amortization reported in decrease (increase) in other current and long-term assets | 24 | 48 | ||||||||
Deferred incremental direct costs net of accumulated amortization | 176 | $ 176 | ||||||||
Deferred incremental direct costs, amortization period | 4 years | |||||||||
Contract Fulfillment Costs and Inducements | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Incremental direct costs of obtaining a contract | $ 10 | |||||||||
Sales | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Total Revenues | 1,017 | 1,010 | 1,950 | 1,946 | ||||||
Sales Revenue, Services, Net [Member] | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Total Revenues | 1,425 | $ 1,483 | 2,856 | $ 2,925 | ||||||
Service, Equipment Products | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Total Revenues | 9 | 20 | ||||||||
ASU 2014-09 | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Increase to retained earnings | 117 | |||||||||
ASU 2014-09 | Sales | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Total Revenues | 9 | 20 | ||||||||
ASU 2014-09 | Sales Revenue, Services, Net [Member] | ||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||||||
Total Revenues | $ 9 | $ 20 | ||||||||
|
Adoption of New Revenue Recognition Standard - Impacts of Adopting ASC Topic 606 (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||
---|---|---|---|---|---|
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred tax assets | $ 917 | $ 1,026 | |||
Other long-term assets | 889 | 682 | |||
Retained earnings | 4,974 | $ 4,856 | |||
Superseded Revenue Guidance(1) | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred tax assets | [1] | 950 | |||
Other long-term assets | [1] | 747 | |||
Retained earnings | [1] | 4,865 | |||
Adjustments | ASU 2014-09 | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred tax assets | (33) | ||||
Other long-term assets | 142 | ||||
Retained earnings | $ 109 | ||||
|
Adoption of New Revenue Recognition Standard - Disaggregation of Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [1] | $ 2,510 | $ 2,567 | $ 4,945 | $ 5,021 | ||||||||||||
Equipment | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [2] | 561 | 547 | 1,060 | 1,049 | ||||||||||||
Supplies, paper and other sales | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 456 | 463 | 890 | 897 | |||||||||||||
Maintenance agreements | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [3] | 634 | 662 | 1,267 | 1,301 | ||||||||||||
Service arrangements | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [4] | 614 | 634 | 1,237 | 1,258 | ||||||||||||
Rental and other | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 177 | 187 | 352 | 366 | |||||||||||||
Financing | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 68 | 74 | 139 | 150 | |||||||||||||
Sales | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 1,017 | 1,010 | 1,950 | 1,946 | |||||||||||||
Service, Equipment Products | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 9 | 20 | |||||||||||||||
Product | Direct Equipment Lease | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [5] | 172 | 163 | 332 | 323 | ||||||||||||
Product | Distributors & resellers | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [6] | 370 | 372 | 701 | 693 | ||||||||||||
Product | Direct equipment lease / Customer direct | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | 475 | 475 | 917 | 930 | |||||||||||||
United States | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [1] | 1,479 | 1,533 | 2,893 | 3,002 | ||||||||||||
Europe | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [1] | 660 | 674 | 1,336 | 1,314 | ||||||||||||
Canada | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [1] | 147 | 150 | 291 | 295 | ||||||||||||
Other | |||||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||||
Total Revenues | [1] | $ 224 | $ 210 | $ 425 | $ 410 | ||||||||||||
|
Recent Accounting Pronouncements (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cost of sales | $ 622 | $ 619 | $ 1,185 | $ 1,184 | |
Cost of services, maintenance and rentals | 854 | 872 | 1,722 | 1,753 | |
Research, development and engineering expenses | 101 | 102 | 201 | 213 | |
Selling, administrative and general expenses | 624 | 626 | 1,252 | 1,260 | |
Restructuring and related costs | 34 | 39 | 62 | 157 | |
Other expenses, net | 39 | 68 | 69 | 182 | |
ASU 2016-02 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating Leases, Future Minimum Payments Due | $ 450 | ||||
ASU 2016-15 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Collections on Beneficial Interests Received in sales of Accounts Receivable and Finance Receivables | 56 | 110 | |||
ASU 2016-18 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Restricted Cash and Cash Equivalents | $ 64 | 75 | $ 64 | ||
ASU 2017-07 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cost of sales | 619 | 1,184 | |||
Cost of services, maintenance and rentals | 872 | 1,753 | |||
Research, development and engineering expenses | 102 | 213 | |||
Selling, administrative and general expenses | 626 | 1,260 | |||
Restructuring and related costs | 39 | 157 | |||
Other expenses, net | 68 | 182 | |||
ASU 2018-05 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Tax Act estimated non-cash provisional charge | $ 400 | ||||
As Reported [Member] | ASU 2017-07 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cost of sales | 619 | 1,186 | |||
Cost of services, maintenance and rentals | 884 | 1,784 | |||
Research, development and engineering expenses | 106 | 224 | |||
Selling, administrative and general expenses | 643 | 1,307 | |||
Restructuring and related costs | 40 | 160 | |||
Other expenses, net | 34 | 88 | |||
Adjustments for New Accounting Pronouncement [Member] | ASU 2017-07 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Cost of sales | 0 | (2) | |||
Cost of services, maintenance and rentals | (12) | (31) | |||
Research, development and engineering expenses | (4) | (11) | |||
Selling, administrative and general expenses | (17) | (47) | |||
Restructuring and related costs | (1) | (3) | |||
Other expenses, net | $ 34 | $ 94 |
Divestitures (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Loss from discontinued operations, net of tax | $ 0 | $ 0 | $ 0 | $ (6) |
Conduent [Domain] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Date | Dec. 31, 2016 | |||
Loss from operations | 8 | |||
Loss on disposal | 0 | |||
Net loss before income taxes | (8) | |||
Income tax benefit | 2 | |||
Loss from discontinued operations, net of tax | $ (6) |
Supplementary Financial Information (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
|||
Supplemental Cash Flow Elements [Line Items] | ||||||||||
Cash and cash equivalents | $ 1,263 | $ 1,263 | $ 1,293 | |||||||
Tax and labor litigation deposits in Brazil | 62 | 62 | 72 | |||||||
Other restricted cash | 2 | 2 | 3 | |||||||
Total Restricted cash | 64 | 64 | 75 | |||||||
Cash, cash equivalents and restricted cash | 1,327 | $ 1,377 | 1,327 | $ 1,377 | $ 1,474 | 1,368 | $ 1,194 | $ 2,402 | ||
Other current assets | 1 | 1 | 1 | |||||||
Other long-term assets | 63 | 63 | $ 74 | |||||||
Provision for receivables | 13 | 10 | 26 | 23 | ||||||
Provision for inventory | 10 | 7 | 14 | 12 | ||||||
Provision for product warranty | 3 | 3 | 7 | 7 | ||||||
Depreciation of buildings and equipment | 44 | 34 | 88 | 68 | ||||||
Depreciation and obsolescence of equipment on operating leases | 63 | 68 | 127 | 135 | ||||||
Amortization of internal use software | 19 | 16 | 37 | 31 | ||||||
Amortization of product software | 0 | 1 | 0 | 3 | ||||||
Amortization of acquired intangible assets | 12 | 15 | 24 | 29 | ||||||
Amortization of customer contract costs(1) | [1] | 25 | 1 | 50 | 2 | |||||
Cost of additions to land, buildings and equipment | 17 | 13 | 26 | 30 | ||||||
Cost of additions to internal use software | 15 | 8 | 24 | 17 | ||||||
Common stock dividends | 64 | 64 | 128 | 145 | ||||||
Preferred stock dividends | 4 | 4 | 7 | 10 | ||||||
Payments to noncontrolling interests | 1 | $ 11 | 13 | $ 12 | ||||||
Amortization of customer contract costs in decrease (increase) in other current and long term assets | $ 24 | $ 48 | ||||||||
|
Accounts Receivable, Net (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Accounts receivable, net | $ 1,297 | $ 1,297 | $ 1,357 | |||||||
Accounts Receivable Sales Arrangements [Abstract] | ||||||||||
Uncollected accounts receivable sold and derecognized | 131 | 131 | 161 | |||||||
Accounts Receivable [Member] | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Invoiced | 1,001 | 1,001 | 1,048 | |||||||
Accrued | 353 | 353 | 368 | |||||||
Allowance for doubtful accounts | (57) | (57) | $ (59) | |||||||
Accounts receivable sales(1) | [1] | 128 | $ 567 | 231 | $ 1,078 | |||||
Deferred proceeds | 0 | 56 | 0 | 108 | ||||||
Loss on sales of accounts receivable | 0 | 3 | 1 | 6 | ||||||
Estimated increase (decrease) to operating cash flows(2) | [2] | $ 26 | $ 54 | $ (25) | $ (11) | |||||
|
Finance Receivables, Net (Details) - USD ($) $ in Millions |
3 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Mar. 31, 2018 |
Jun. 30, 2017 |
Mar. 31, 2017 |
||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning Balance | $ 108 | $ 108 | $ 111 | $ 110 | |||||||
Provision | 9 | 9 | 6 | 9 | |||||||
Charge-offs | (8) | (10) | (14) | (10) | |||||||
Recoveries and other | [1] | (2) | 1 | 5 | 2 | ||||||
Ending Balance | 107 | 108 | 108 | 111 | |||||||
Financing Receivable, Collectively Evaluated for Impairment | [2] | 3,630 | 3,811 | ||||||||
Allowance for credit losses not included in the impairment evaluation | 107 | 108 | |||||||||
United States | |||||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning Balance | 56 | 56 | 53 | 55 | |||||||
Provision | 4 | 5 | 4 | 4 | |||||||
Charge-offs | (4) | (5) | (10) | (6) | |||||||
Recoveries and other | [1] | 0 | 0 | 1 | 0 | ||||||
Ending Balance | 56 | 56 | 48 | 53 | |||||||
Financing Receivable, Collectively Evaluated for Impairment | [2] | 1,962 | 2,028 | ||||||||
Canada | |||||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning Balance | 14 | 15 | 16 | 16 | |||||||
Provision | 1 | 0 | 1 | 0 | |||||||
Charge-offs | (1) | (1) | (1) | (2) | |||||||
Recoveries and other | [1] | 0 | 0 | 0 | 2 | ||||||
Ending Balance | 14 | 14 | 16 | 16 | |||||||
Financing Receivable, Collectively Evaluated for Impairment | [2] | 356 | 383 | ||||||||
Europe | |||||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning Balance | 36 | 35 | 40 | 37 | |||||||
Provision | 4 | 4 | 1 | 5 | |||||||
Charge-offs | (3) | (4) | (3) | (2) | |||||||
Recoveries and other | [1] | (2) | 1 | 4 | 0 | ||||||
Ending Balance | 35 | 36 | 42 | 40 | |||||||
Financing Receivable, Collectively Evaluated for Impairment | [2] | 1,256 | 1,336 | ||||||||
Other | |||||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning Balance | [3] | 2 | 2 | 2 | 2 | ||||||
Provision | [3] | 0 | 0 | 0 | 0 | ||||||
Charge-offs | [3] | 0 | 0 | 0 | 0 | ||||||
Recoveries and other | [1],[3] | 0 | 0 | 0 | 0 | ||||||
Ending Balance | [3] | 2 | $ 2 | 2 | $ 2 | ||||||
Financing Receivable, Collectively Evaluated for Impairment | [2],[3] | $ 56 | $ 64 | ||||||||
|
Finance Receivables, Net - Credit Quality Indicators (Details) - USD ($) $ in Millions |
6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Loss Rates Of Customers With Investment Grade Credit Quality | 1.00% | ||||||||
Loss Rates Of Customers With Non Investment Grade Credit Quality Low Range | 2.00% | ||||||||
Loss Rates Of Customers With Non Investment Grade Credit Quality High Range | 5.00% | ||||||||
Loss Rated of Customers with Substandard Doubtful Credit Quality - Low | 7.00% | ||||||||
Loss Rated of Customers with Substandard Doubtful Credit Quality High | 10.00% | ||||||||
Financing Receivable, Net | $ 3,630 | $ 3,860 | |||||||
United States | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 1,962 | 2,029 | |||||||
United States | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 600 | 619 | |||||||
United States | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 531 | 557 | |||||||
United States | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 315 | 322 | |||||||
United States | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 177 | 180 | |||||||
United States | Healthcare | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 142 | 145 | |||||||
United States | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 197 | 206 | |||||||
Canada | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 356 | 397 | |||||||
Canada | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 112 | 123 | |||||||
Canada | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 50 | 58 | |||||||
Canada | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 85 | 96 | |||||||
Canada | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 39 | 43 | |||||||
Canada | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 70 | 77 | |||||||
Europe | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 1,256 | 1,362 | |||||||
France | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 441 | 482 | |||||||
U.K./Ireland | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 239 | 266 | |||||||
Central | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [1] | 328 | 354 | ||||||
Southern | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [2] | 203 | 209 | ||||||
Nordics | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [3] | 45 | 51 | ||||||
Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 56 | 72 | |||||||
Investment Grade | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 1,745 | 1,851 | |||||||
Investment Grade | United States | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 952 | 1,011 | |||||||
Investment Grade | United States | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 184 | 199 | |||||||
Investment Grade | United States | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 459 | 490 | |||||||
Investment Grade | United States | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 86 | 84 | |||||||
Investment Grade | United States | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 80 | 82 | |||||||
Investment Grade | United States | Healthcare | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 82 | 88 | |||||||
Investment Grade | United States | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 61 | 68 | |||||||
Investment Grade | Canada | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 172 | 192 | |||||||
Investment Grade | Canada | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 51 | 54 | |||||||
Investment Grade | Canada | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 42 | 48 | |||||||
Investment Grade | Canada | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 28 | 34 | |||||||
Investment Grade | Canada | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 18 | 20 | |||||||
Investment Grade | Canada | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 33 | 36 | |||||||
Investment Grade | Europe | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 587 | 610 | |||||||
Investment Grade | France | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 227 | 234 | |||||||
Investment Grade | U.K./Ireland | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 101 | 106 | |||||||
Investment Grade | Central | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [1] | 187 | 189 | ||||||
Investment Grade | Southern | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [2] | 46 | 52 | ||||||
Investment Grade | Nordics | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [3] | 26 | 29 | ||||||
Investment Grade | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 34 | 38 | |||||||
Non-investment Grade | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 1,489 | 1,570 | |||||||
Non-investment Grade | United States | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 754 | 733 | |||||||
Non-investment Grade | United States | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 331 | 345 | |||||||
Non-investment Grade | United States | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 65 | 61 | |||||||
Non-investment Grade | United States | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 133 | 97 | |||||||
Non-investment Grade | United States | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 81 | 84 | |||||||
Non-investment Grade | United States | Healthcare | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 51 | 48 | |||||||
Non-investment Grade | United States | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 93 | 98 | |||||||
Non-investment Grade | Canada | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 105 | 119 | |||||||
Non-investment Grade | Canada | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 37 | 42 | |||||||
Non-investment Grade | Canada | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 4 | 5 | |||||||
Non-investment Grade | Canada | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 30 | 35 | |||||||
Non-investment Grade | Canada | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 11 | 12 | |||||||
Non-investment Grade | Canada | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 23 | 25 | |||||||
Non-investment Grade | Europe | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 610 | 690 | |||||||
Non-investment Grade | France | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 193 | 226 | |||||||
Non-investment Grade | U.K./Ireland | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 127 | 150 | |||||||
Non-investment Grade | Central | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [1] | 128 | 149 | ||||||
Non-investment Grade | Southern | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [2] | 144 | 144 | ||||||
Non-investment Grade | Nordics | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [3] | 18 | 21 | ||||||
Non-investment Grade | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 20 | 28 | |||||||
Substandard | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 396 | 439 | |||||||
Substandard | United States | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 256 | 285 | |||||||
Substandard | United States | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 85 | 75 | |||||||
Substandard | United States | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 7 | 6 | |||||||
Substandard | United States | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 96 | 141 | |||||||
Substandard | United States | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 16 | 14 | |||||||
Substandard | United States | Healthcare | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 9 | 9 | |||||||
Substandard | United States | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 43 | 40 | |||||||
Substandard | Canada | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 79 | 86 | |||||||
Substandard | Canada | Finance and other services | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 24 | 27 | |||||||
Substandard | Canada | Government and education | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 4 | 5 | |||||||
Substandard | Canada | Graphic arts | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 27 | 27 | |||||||
Substandard | Canada | Industrial | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 10 | 11 | |||||||
Substandard | Canada | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 14 | 16 | |||||||
Substandard | Europe | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 59 | 62 | |||||||
Substandard | France | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 21 | 22 | |||||||
Substandard | U.K./Ireland | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | 11 | 10 | |||||||
Substandard | Central | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [1] | 13 | 16 | ||||||
Substandard | Southern | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [2] | 13 | 13 | ||||||
Substandard | Nordics | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | [3] | 1 | 1 | ||||||
Substandard | Other | |||||||||
Financing Receivable, Recorded Investment [Line Items] | |||||||||
Financing Receivable, Net | $ 2 | $ 6 | |||||||
|
Finance Receivables, Net - Aging (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | $ 3,630 | $ 3,860 | |||||||||
Total Finance Receivables | 3,630 | 3,860 | |||||||||
Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 103 | 115 | |||||||||
Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 3,527 | 3,745 | |||||||||
United States | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1,962 | 2,029 | |||||||||
Total Finance Receivables | 1,962 | 2,029 | |||||||||
United States | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 73 | 83 | |||||||||
United States | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 1,889 | 1,946 | |||||||||
United States | Finance and other services | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 600 | 619 | |||||||||
Total Finance Receivables | 600 | 619 | |||||||||
United States | Finance and other services | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 19 | 22 | |||||||||
United States | Finance and other services | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 581 | 597 | |||||||||
United States | Government and education | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 531 | 557 | |||||||||
Total Finance Receivables | 531 | 557 | |||||||||
United States | Government and education | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 21 | 24 | |||||||||
United States | Government and education | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 510 | 533 | |||||||||
United States | Graphic arts | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 315 | 322 | |||||||||
Total Finance Receivables | 315 | 322 | |||||||||
United States | Graphic arts | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 12 | 13 | |||||||||
United States | Graphic arts | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 303 | 309 | |||||||||
United States | Industrial | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 177 | 180 | |||||||||
Total Finance Receivables | 177 | 180 | |||||||||
United States | Industrial | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 7 | 8 | |||||||||
United States | Industrial | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 170 | 172 | |||||||||
United States | Healthcare | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 142 | 145 | |||||||||
Total Finance Receivables | 142 | 145 | |||||||||
United States | Healthcare | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 6 | 7 | |||||||||
United States | Healthcare | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 136 | 138 | |||||||||
United States | Other | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 197 | 206 | |||||||||
Total Finance Receivables | 197 | 206 | |||||||||
United States | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 8 | 9 | |||||||||
United States | Other | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 189 | 197 | |||||||||
Canada | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 356 | 397 | |||||||||
Total Finance Receivables | 356 | 397 | |||||||||
Canada | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 10 | 11 | |||||||||
Canada | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 346 | 386 | |||||||||
Canada | Finance and other services | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 112 | 123 | |||||||||
Canada | Government and education | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 50 | 58 | |||||||||
Canada | Graphic arts | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 85 | 96 | |||||||||
Canada | Industrial | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 39 | 43 | |||||||||
Canada | Other | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 70 | 77 | |||||||||
Europe | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1,256 | 1,362 | |||||||||
Total Finance Receivables | 1,256 | 1,362 | |||||||||
Europe | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 17 | 18 | |||||||||
Europe | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 1,239 | 1,344 | |||||||||
France | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 441 | 482 | |||||||||
Total Finance Receivables | 441 | 482 | |||||||||
France | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 7 | 6 | |||||||||
France | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 434 | 476 | |||||||||
U.K./Ireland | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 239 | 266 | |||||||||
Total Finance Receivables | 239 | 266 | |||||||||
U.K./Ireland | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 2 | 3 | |||||||||
U.K./Ireland | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 237 | 263 | |||||||||
Central | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [1] | 328 | 354 | ||||||||
Total Finance Receivables | [2] | 328 | 354 | ||||||||
Central | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | [2] | 3 | 3 | ||||||||
Central | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | [2] | 325 | 351 | ||||||||
Southern | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [3] | 203 | 209 | ||||||||
Total Finance Receivables | [3] | 203 | 209 | ||||||||
Southern | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | [3] | 5 | 6 | ||||||||
Southern | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | [3] | 198 | 203 | ||||||||
Nordics | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [4] | 45 | 51 | ||||||||
Total Finance Receivables | [4] | 45 | 51 | ||||||||
Nordics | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | [4] | 0 | 0 | ||||||||
Nordics | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | [4] | 45 | 51 | ||||||||
Other | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 56 | 72 | |||||||||
Total Finance Receivables | 56 | 72 | |||||||||
Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Total Billed | 3 | 3 | |||||||||
Other | Unbilled Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Unbilled | 53 | 69 | |||||||||
Current | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 78 | 91 | |||||||||
Current | United States | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 56 | 66 | |||||||||
Current | United States | Finance and other services | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 14 | 18 | |||||||||
Current | United States | Government and education | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 16 | 18 | |||||||||
Current | United States | Graphic arts | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 11 | 12 | |||||||||
Current | United States | Industrial | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 5 | 6 | |||||||||
Current | United States | Healthcare | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 4 | 5 | |||||||||
Current | United States | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 6 | 7 | |||||||||
Current | Canada | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 7 | 8 | |||||||||
Current | Europe | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 12 | 14 | |||||||||
Current | France | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 7 | 6 | |||||||||
Current | U.K./Ireland | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 3 | |||||||||
Current | Central | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [2] | 1 | 1 | ||||||||
Current | Southern | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [3] | 3 | 4 | ||||||||
Current | Nordics | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [4] | 0 | 0 | ||||||||
Current | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 3 | 3 | |||||||||
31-90 Days Past Due | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 15 | 15 | |||||||||
31-90 Days Past Due | United States | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 10 | 10 | |||||||||
31-90 Days Past Due | United States | Finance and other services | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 3 | 3 | |||||||||
31-90 Days Past Due | United States | Government and education | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 3 | 3 | |||||||||
31-90 Days Past Due | United States | Graphic arts | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
31-90 Days Past Due | United States | Industrial | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
31-90 Days Past Due | United States | Healthcare | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
31-90 Days Past Due | United States | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
31-90 Days Past Due | Canada | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 2 | 2 | |||||||||
31-90 Days Past Due | Europe | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 3 | 3 | |||||||||
31-90 Days Past Due | France | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
31-90 Days Past Due | U.K./Ireland | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 0 | |||||||||
31-90 Days Past Due | Central | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [2] | 1 | 2 | ||||||||
31-90 Days Past Due | Southern | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [3] | 1 | 1 | ||||||||
31-90 Days Past Due | Nordics | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [4] | 0 | 0 | ||||||||
31-90 Days Past Due | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days Past Due | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 10 | 9 | |||||||||
90 Days Past Due | United States | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 7 | 7 | |||||||||
90 Days Past Due | United States | Finance and other services | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 2 | 1 | |||||||||
90 Days Past Due | United States | Government and education | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 2 | 3 | |||||||||
90 Days Past Due | United States | Graphic arts | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days Past Due | United States | Industrial | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
90 Days Past Due | United States | Healthcare | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
90 Days Past Due | United States | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
90 Days Past Due | Canada | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 1 | 1 | |||||||||
90 Days Past Due | Europe | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 2 | 1 | |||||||||
90 Days Past Due | France | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days Past Due | U.K./Ireland | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days Past Due | Central | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [2] | 1 | 0 | ||||||||
90 Days Past Due | Southern | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [3] | 1 | 1 | ||||||||
90 Days Past Due | Nordics | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [4] | 0 | 0 | ||||||||
90 Days Past Due | Other | Billed Revenues | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days and Accruing | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 101 | 102 | |||||||||
90 Days and Accruing | United States | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 50 | 51 | |||||||||
90 Days and Accruing | United States | Finance and other services | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 10 | 12 | |||||||||
90 Days and Accruing | United States | Government and education | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 22 | 21 | |||||||||
90 Days and Accruing | United States | Graphic arts | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 4 | 6 | |||||||||
90 Days and Accruing | United States | Industrial | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 4 | 4 | |||||||||
90 Days and Accruing | United States | Healthcare | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 5 | 5 | |||||||||
90 Days and Accruing | United States | Other | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 5 | 3 | |||||||||
90 Days and Accruing | Canada | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 20 | 17 | |||||||||
90 Days and Accruing | Europe | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 31 | 34 | |||||||||
90 Days and Accruing | France | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 17 | 22 | |||||||||
90 Days and Accruing | U.K./Ireland | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | 0 | 0 | |||||||||
90 Days and Accruing | Central | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [2] | 8 | 6 | ||||||||
90 Days and Accruing | Southern | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [3] | 6 | 6 | ||||||||
90 Days and Accruing | Nordics | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | [4] | 0 | 0 | ||||||||
90 Days and Accruing | Other | |||||||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||||||||
Financing Receivable, Net | $ 0 | $ 0 | |||||||||
|
Inventories (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Inventories, net [Abstract] | ||
Finished goods | $ 803 | $ 777 |
Work-in-process | 52 | 49 |
Raw materials | 92 | 89 |
Total Inventories | $ 947 | $ 915 |
Investment in Affiliates, at Equity (Details) $ in Millions, ¥ in Billions |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
|
Mar. 31, 2018
USD ($)
|
Mar. 31, 2018
JPY (¥)
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2017
USD ($)
|
|||
Schedule of Equity Method Investments [Line Items] | ||||||||
Total Equity in net income (loss) of unconsolidated affiliates | $ 19 | $ 20 | $ (49) | $ 60 | ||||
Fuji Xerox | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Total Equity in net income (loss) of unconsolidated affiliates | $ 17 | 18 | $ (53) | 55 | ||||
Ownership percentage | 25.00% | 25.00% | ||||||
After-tax restructuring and other charges | $ 4 | $ 83 | ||||||
Summary of Operations: | ||||||||
Revenues | 2,226 | 2,325 | 4,691 | 4,884 | ||||
Costs and expenses | 2,098 | 2,191 | 4,869 | 4,543 | ||||
Income (Loss) before Income Taxes | 128 | 134 | (178) | 341 | ||||
Income tax expense | 50 | 32 | 11 | 76 | ||||
Net Income (Loss) | 78 | 102 | (189) | 265 | ||||
Less: Net income attributable to noncontrolling interests | 1 | 1 | 1 | 2 | ||||
Net Income (Loss) – Fuji Xerox | $ 77 | $ 101 | $ (190) | $ 263 | ||||
Weighted Average Exchange Rate | [1] | 109.05 | 108.07 | 108.07 | 111.01 | 108.54 | 112.42 | |
Fuji Xerox | Parent Company - Fujifilm Holdings Corporation | Restatement Adjustment [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Out-of-Period Adjustment - Fuji Xerox | $ 110 | ¥ 12 | ||||||
Fuji Xerox | Non Parent Equity Investment Owner - Xerox Corporation | Restatement Adjustment [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Out-of-Period Adjustment - Fuji Xerox | $ 28 | |||||||
Other | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Total Equity in net income (loss) of unconsolidated affiliates | $ 2 | $ 2 | $ 4 | $ 5 | ||||
|
Restructuring Programs (Details) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
|
Mar. 31, 2018
USD ($)
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
Employees
|
Jun. 30, 2017
USD ($)
|
||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Restructuring, Net Current Period Charges | [1] | $ 34 | $ 28 | $ 62 | ||||||
Restructuring Charges | 40 | 36 | ||||||||
Restructuring and Related Cost, Expected Number of Positions Eliminated (approximately) | Employees | 950 | |||||||||
Reversals | (6) | (8) | $ (14) | |||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Balance at beginning of period | 85 | 109 | 109 | |||||||
Provision | 40 | 36 | ||||||||
Reversals | (6) | (8) | (14) | |||||||
Net Current Period Charges | [1] | 34 | 28 | 62 | ||||||
Charges against reserve and currency | (40) | (52) | $ (59) | (92) | $ (116) | |||||
Balance at end of period | 79 | 85 | 79 | |||||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||||||
Charges against reserve and currency | (40) | (52) | (59) | (92) | (116) | |||||
Effects of foreign currency and other non-cash items | 3 | (7) | 1 | (8) | ||||||
Restructuring Cash Payments | (37) | $ (66) | (91) | $ (124) | ||||||
Severance and Related Costs [Member] | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Restructuring, Net Current Period Charges | [1] | 34 | 16 | |||||||
Restructuring Charges | 40 | 24 | 64 | |||||||
Reversals | (6) | (8) | ||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Balance at beginning of period | 83 | 108 | 108 | |||||||
Provision | 40 | 24 | 64 | |||||||
Reversals | (6) | (8) | ||||||||
Net Current Period Charges | [1] | 34 | 16 | |||||||
Charges against reserve and currency | (39) | (41) | ||||||||
Balance at end of period | 78 | 83 | 78 | |||||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||||||
Charges against reserve and currency | (39) | (41) | ||||||||
Lease Cancellation and Other Costs [Member] | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Restructuring, Net Current Period Charges | [1] | 0 | 12 | |||||||
Restructuring Charges | 0 | 12 | 12 | |||||||
Reversals | 0 | 0 | ||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Balance at beginning of period | 2 | 1 | 1 | |||||||
Provision | 0 | 12 | 12 | |||||||
Reversals | 0 | 0 | ||||||||
Net Current Period Charges | [1] | 0 | 12 | |||||||
Charges against reserve and currency | (1) | (11) | ||||||||
Balance at end of period | 1 | 2 | 1 | |||||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||||||
Charges against reserve and currency | (1) | (11) | ||||||||
Asset Impairments [Member] | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Restructuring, Net Current Period Charges | [1],[2] | 0 | 0 | |||||||
Restructuring Charges | [2] | 0 | 0 | |||||||
Reversals | [2] | 0 | 0 | |||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Balance at beginning of period | [2] | 0 | 0 | 0 | ||||||
Provision | [2] | 0 | 0 | |||||||
Reversals | [2] | 0 | 0 | |||||||
Net Current Period Charges | [1],[2] | 0 | 0 | |||||||
Charges against reserve and currency | [2] | 0 | 0 | |||||||
Balance at end of period | [2] | 0 | 0 | $ 0 | ||||||
Reconciliation To Consolidated Statements Of Cash Flows [Abstract] | ||||||||||
Charges against reserve and currency | [2] | $ 0 | $ 0 | |||||||
|
Debt - Interest Income and Expense (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||
Debt Disclosure [Abstract] | |||||||||
Interest expense | [1] | $ 60 | $ 57 | $ 123 | $ 126 | ||||
Interest income | [2] | $ 72 | $ 76 | $ 146 | $ 154 | ||||
|
Financial Instruments - Fair Value Hedges (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 1,925 | $ 1,788 |
Average Maturity of Foreign Exchange Hedging Contracts - within Three Months | 85.00% | |
Average Maturity of Foreign Exchange Hedging Contracts - within Three and Six Months | 7.00% | |
Average Maturity of Foreign Exchange Hedging Contracts - within Six and Twelve Months | 8.00% | |
Senior Notes Due 2021 [Member] | ||
Derivative [Line Items] | ||
Notional Amount | $ 300 | |
Derivative Asset, Fair Value, Gross Asset (Liability) | $ (5) | |
Weighted Average Interest Rate Paid | 2.95% | |
Interest Rate Received | 4.50% |
Financial Instruments - Summary of Derivative Instruments Fair Value (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Asset (Liability) | $ 14 | $ (22) |
Assets [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 26 | 3 |
Liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (12) | (25) |
Derivatives Designated as Hedging Instruments [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Asset (Liability) | 4 | (14) |
Derivatives Designated as Hedging Instruments [Member] | Liabilities [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Asset (Liability) | (1) | (13) |
Derivatives Designated as Hedging Instruments [Member] | Foreign exchange contracts - forwards [Member] | Other current assets | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 5 | 1 |
Derivatives Designated as Hedging Instruments [Member] | Foreign exchange contracts - forwards [Member] | Other current liabilities | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (2) | (15) |
Derivatives Designated as Hedging Instruments [Member] | Foreign currency options [Member] | Other current assets | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 2 | 0 |
Derivatives Designated as Hedging Instruments [Member] | Foreign currency options [Member] | Other current liabilities | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (1) | 0 |
Derivatives Designated as Hedging Instruments [Member] | Interest Rate Swap [Member] | Other long-term assets | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 0 | 1 |
Derivatives Designated as Hedging Instruments [Member] | Interest Rate Swap [Member] | Other long-term liabilities | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | (5) | 0 |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Net Derivative Asset (Liability) | 15 | (9) |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | Other current assets | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Assets | 19 | 1 |
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts - forwards [Member] | Other current liabilities | ||
Summary Of Derivative Instruments By Hedge Designation [Abstract] | ||
Total Derivative Liabilities | $ (4) | $ (10) |
Financial Instruments - Summary of Derivative Instruments Gain (Losses) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Net gains recorded in AOCL expected to be reclassified to net income in the future | $ 2 | |||
Foreign Currency Transaction Gains (Losses), before Tax | $ (1) | $ (1) | 1 | $ (4) |
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative (loss) gain recognized in OCI (effective portion) | (2) | (22) | 10 | (13) |
Interest Expense [Member] | Fair Value Hedging [Member] | Interest Rate Contract [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative (loss) gain recognized in interest expense | (1) | 2 | (6) | 1 |
Hedged item gain (loss) recognized in interest expense | 1 | (2) | 6 | (1) |
Cost of Sales [Member] | Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative Loss reclassified from AOCL to income - Cost of sales (effective portion) | 0 | (4) | (12) | (8) |
Derivative loss reclassified from AOCL to income - Cost of Sales (ineffective) | 0 | 0 | 0 | 0 |
Derivative, Underlying Amount | 0 | 0 | 0 | 0 |
Foreign Currency Gain (Loss) [Member] | Foreign Exchange Forward [Member] | Derivatives Not Designated as Hedging Instruments [Member] | ||||
Summary of Derivative Instruments Gains (Losses) [Abstract] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 18 | $ (14) | $ 18 | $ (10) |
Fair Value of Financial Assets and Liabilities - Recurring (Details) - Fair Value, Measurements, Recurring [Member] - Significant Other Observable Inputs (Level 2) [Member] - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Assets: | ||
Deferred compensation investments in mutual funds | $ 19 | $ 18 |
Total | 45 | 21 |
Liabilities: | ||
Deferred compensation plan liabilities | 18 | 19 |
Total | 30 | 44 |
Foreign Exchange Forward [Member] | ||
Assets: | ||
Foreign currency contracts - assets | 24 | 2 |
Liabilities: | ||
Foreign currency contracts - liabilities | 6 | 25 |
Foreign currency options [Member] | ||
Assets: | ||
Foreign currency contracts - assets | 2 | 0 |
Liabilities: | ||
Foreign currency contracts - liabilities | 1 | 0 |
Interest Rate Swap [Member] | ||
Assets: | ||
Interest rate swaps | 0 | 1 |
Liabilities: | ||
Interest rate swaps | $ 5 | $ 0 |
Fair Value of Financial Assets and Liabilities - Nonrecurring (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 1,263 | $ 1,293 |
Accounts receivable, net | 1,297 | 1,357 |
Short-term debt and current portion of long-term debt | 412 | 282 |
Long-term debt | 4,813 | 5,235 |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 1,263 | 1,293 |
Accounts receivable, net | 1,297 | 1,357 |
Short-term debt and current portion of long-term debt | 411 | 283 |
Long-term debt | $ 4,815 | $ 5,373 |
Employee Benefit Plans (Details) - USD ($) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
Dec. 31, 2018 |
||||||||||||
Components of Net Periodic Benefit Costs: | |||||||||||||||||
Defined Benefit Plans | $ 26,000,000 | $ 37,000,000 | $ 53,000,000 | $ 99,000,000 | |||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||
Net actuarial (gain) loss(2) | (22,000,000) | (1,000,000) | 36,000,000 | (9,000,000) | |||||||||||||
Amortization of net actuarial loss | [1] | 47,000,000 | 44,000,000 | 93,000,000 | 110,000,000 | ||||||||||||
Amortization of prior service credit | [1] | (3,000,000) | (3,000,000) | (5,000,000) | (5,000,000) | ||||||||||||
Pension Plan [Member] | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | 75,000,000 | 46,000,000 | $ 836,000,000 | ||||||||||||||
Pension Plan [Member] | Forecast | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year | $ 192,000,000 | ||||||||||||||||
Pension Plan [Member] | Domestic Plan [Member] | |||||||||||||||||
Components of Net Periodic Benefit Costs: | |||||||||||||||||
Service cost | 0 | 1,000,000 | 1,000,000 | 2,000,000 | |||||||||||||
Interest cost | 34,000,000 | 32,000,000 | 67,000,000 | 66,000,000 | |||||||||||||
Expected return on plan assets | (36,000,000) | (30,000,000) | (70,000,000) | (61,000,000) | |||||||||||||
Recognized net actuarial loss | 6,000,000 | 6,000,000 | 12,000,000 | 11,000,000 | |||||||||||||
Amortization of prior service credit | (1,000,000) | (1,000,000) | (1,000,000) | (1,000,000) | |||||||||||||
Recognized settlement loss | 26,000,000 | 19,000,000 | 51,000,000 | 61,000,000 | |||||||||||||
Defined Benefit Plans | 29,000,000 | 27,000,000 | 60,000,000 | 78,000,000 | |||||||||||||
Defined contribution plans | 10,000,000 | 10,000,000 | [2] | 19,000,000 | 20,000,000 | [2] | |||||||||||
Net Periodic Benefit Cost | 39,000,000 | 37,000,000 | 79,000,000 | 98,000,000 | |||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||
Net actuarial (gain) loss(2) | [3] | 12,000,000 | 12,000,000 | (46,000,000) | 20,000,000 | ||||||||||||
Amortization of net actuarial loss | (32,000,000) | (25,000,000) | (63,000,000) | (72,000,000) | |||||||||||||
Amortization of prior service credit | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | |||||||||||||
Total Recognized in Other Comprehensive (Loss) Income(3) | [4] | (19,000,000) | (12,000,000) | (108,000,000) | (51,000,000) | ||||||||||||
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive (Loss) Income | 20,000,000 | 25,000,000 | (29,000,000) | 47,000,000 | |||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | 14,000,000 | 12,000,000 | 675,000,000 | ||||||||||||||
Pension Plan [Member] | Domestic Plan [Member] | Forecast | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year | 76,000,000 | ||||||||||||||||
Pension Plan [Member] | Domestic Plan [Member] | Minimum Funding Requirement [Member] | Qualified Plan [Member] | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | 0 | ||||||||||||||||
Pension Plan [Member] | Domestic Plan [Member] | Voluntary Contributions [Member] | Qualified Plan [Member] | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | 50,000,000 | ||||||||||||||||
Pension Plan [Member] | Foreign Plan [Member] | |||||||||||||||||
Components of Net Periodic Benefit Costs: | |||||||||||||||||
Service cost | 7,000,000 | 8,000,000 | 13,000,000 | 15,000,000 | |||||||||||||
Interest cost | 38,000,000 | 38,000,000 | 77,000,000 | 77,000,000 | |||||||||||||
Expected return on plan assets | (62,000,000) | (54,000,000) | (125,000,000) | (107,000,000) | |||||||||||||
Recognized net actuarial loss | 15,000,000 | 19,000,000 | 30,000,000 | 38,000,000 | |||||||||||||
Amortization of prior service credit | (1,000,000) | (1,000,000) | (2,000,000) | (2,000,000) | |||||||||||||
Recognized settlement loss | 0 | 0 | 0 | 0 | |||||||||||||
Defined Benefit Plans | (3,000,000) | 10,000,000 | (7,000,000) | 21,000,000 | |||||||||||||
Defined contribution plans | 7,000,000 | 7,000,000 | [2] | 14,000,000 | 14,000,000 | [2] | |||||||||||
Net Periodic Benefit Cost | 4,000,000 | 17,000,000 | 7,000,000 | 35,000,000 | |||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||
Net actuarial (gain) loss(2) | [3] | 0 | 0 | 0 | 0 | ||||||||||||
Amortization of net actuarial loss | (15,000,000) | (19,000,000) | (30,000,000) | (38,000,000) | |||||||||||||
Amortization of prior service credit | 1,000,000 | 1,000,000 | 2,000,000 | 2,000,000 | |||||||||||||
Total Recognized in Other Comprehensive (Loss) Income(3) | [4] | (14,000,000) | (18,000,000) | (28,000,000) | (36,000,000) | ||||||||||||
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive (Loss) Income | (10,000,000) | (1,000,000) | (21,000,000) | (1,000,000) | |||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | 61,000,000 | 34,000,000 | 161,000,000 | ||||||||||||||
Pension Plan [Member] | Foreign Plan [Member] | Forecast | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year | 116,000,000 | ||||||||||||||||
Retiree Health [Member] | |||||||||||||||||
Components of Net Periodic Benefit Costs: | |||||||||||||||||
Service cost | 1,000,000 | 1,000,000 | 2,000,000 | 2,000,000 | |||||||||||||
Interest cost | 7,000,000 | 7,000,000 | 13,000,000 | 14,000,000 | |||||||||||||
Expected return on plan assets | 0 | 0 | 0 | 0 | |||||||||||||
Recognized net actuarial loss | 0 | 0 | 0 | 0 | |||||||||||||
Amortization of prior service credit | (1,000,000) | (1,000,000) | (2,000,000) | (2,000,000) | |||||||||||||
Recognized settlement loss | 0 | 0 | 0 | 0 | |||||||||||||
Defined Benefit Plans | 7,000,000 | 7,000,000 | 13,000,000 | 14,000,000 | |||||||||||||
Net Periodic Benefit Cost | 7,000,000 | 7,000,000 | 13,000,000 | 14,000,000 | |||||||||||||
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive (Loss) Income: | |||||||||||||||||
Net actuarial (gain) loss(2) | [3] | 10,000,000 | (11,000,000) | 10,000,000 | (11,000,000) | ||||||||||||
Amortization of net actuarial loss | 0 | 0 | 0 | 0 | |||||||||||||
Amortization of prior service credit | 1,000,000 | 1,000,000 | 2,000,000 | 2,000,000 | |||||||||||||
Total Recognized in Other Comprehensive (Loss) Income(3) | [4] | 11,000,000 | (10,000,000) | 12,000,000 | (9,000,000) | ||||||||||||
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive (Loss) Income | $ 18,000,000 | $ (3,000,000) | 25,000,000 | 5,000,000 | |||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Plan Assets, Contributions by Employer | $ 29,000,000 | $ 32,000,000 | $ 64,000,000 | ||||||||||||||
Retiree Health [Member] | Forecast | |||||||||||||||||
Contributions [Abstract] | |||||||||||||||||
Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year | $ 62,000,000 | ||||||||||||||||
|
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Mar. 31, 2018 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | $ 5,256 | $ 5,256 | |||||||||||||
Noncontrolling Interests, Beginning Balance | 37 | 37 | |||||||||||||
Total Equity, Beginning Balance | $ 5,293 | $ 4,747 | 5,293 | $ 4,747 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 120 | |||||||||||||
Comprehensive income, net attributable to Xerox | $ (123) | $ 327 | 111 | 533 | |||||||||||
Comprehensive income, net attributable to noncontrolling interests | 2 | 4 | 5 | 7 | |||||||||||
Comprehensive (Loss) Income, Net | (121) | 331 | 116 | 540 | |||||||||||
Cash dividends declared - common | [2] | (130) | (129) | ||||||||||||
Cash dividends declared - preferred | [3] | (7) | (7) | ||||||||||||
Stock option and incentive plans, net | 27 | 17 | |||||||||||||
Distributions to noncontrolling interests | (11) | (10) | |||||||||||||
Xerox Shareholders' Equity, Ending Balance | 5,377 | 5,377 | |||||||||||||
Noncontrolling Interests, Ending Balance | 31 | 31 | |||||||||||||
Total Equity, Ending Balance | $ 5,408 | $ 5,158 | $ 5,408 | $ 5,158 | |||||||||||
Dividends per common share (in dollars per share) | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.50 | $ 0.50 | |||||||||
Treasury Stock, Shares, Acquired (in shares) | 0 | 0 | |||||||||||||
Series B Preferred Stock [Member] | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Dividends per preferred share (in dollars per share) | $ 20.00 | $ 20.00 | $ 20.00 | $ 20.00 | |||||||||||
Xerox Shareholders’ Equity | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | $ 5,256 | $ 4,709 | $ 5,256 | $ 4,709 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 120 | |||||||||||||
Comprehensive income, net attributable to Xerox | 111 | 533 | |||||||||||||
Cash dividends declared - common | [2] | (130) | (129) | ||||||||||||
Cash dividends declared - preferred | [3] | (7) | (7) | ||||||||||||
Stock option and incentive plans, net | 27 | 17 | |||||||||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||||||||
Xerox Shareholders' Equity, Ending Balance | $ 5,377 | $ 5,123 | 5,377 | 5,123 | |||||||||||
Common Stock | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | 255 | 254 | 255 | 254 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 0 | |||||||||||||
Comprehensive income, net attributable to Xerox | 0 | 0 | |||||||||||||
Cash dividends declared - common | [2] | 0 | 0 | ||||||||||||
Cash dividends declared - preferred | [3] | 0 | 0 | ||||||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||||||||
Xerox Shareholders' Equity, Ending Balance | 255 | 254 | 255 | 254 | |||||||||||
Additional Paid-in Capital | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | 3,893 | 3,858 | 3,893 | 3,858 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 0 | |||||||||||||
Comprehensive income, net attributable to Xerox | 0 | 0 | |||||||||||||
Cash dividends declared - common | [2] | 0 | 0 | ||||||||||||
Cash dividends declared - preferred | [3] | 0 | 0 | ||||||||||||
Stock option and incentive plans, net | 27 | 17 | |||||||||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||||||||
Xerox Shareholders' Equity, Ending Balance | 3,920 | 3,875 | 3,920 | 3,875 | |||||||||||
Retained Earnings | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | 4,856 | 4,934 | 4,856 | 4,934 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 120 | |||||||||||||
Comprehensive income, net attributable to Xerox | 135 | 206 | |||||||||||||
Cash dividends declared - common | [2] | (130) | (129) | ||||||||||||
Cash dividends declared - preferred | [3] | (7) | (7) | ||||||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||||||||
Distributions to noncontrolling interests | 0 | 0 | |||||||||||||
Xerox Shareholders' Equity, Ending Balance | 4,974 | 5,004 | 4,974 | 5,004 | |||||||||||
AOCL | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Xerox Shareholders' Equity, Beginning Balance | [4] | (3,748) | (4,337) | (3,748) | (4,337) | ||||||||||
Cumulative effect of change in accounting principles(1) | [1],[4] | 0 | |||||||||||||
Comprehensive income, net attributable to Xerox | [4] | (24) | 327 | ||||||||||||
Cash dividends declared - common | [2],[4] | 0 | 0 | ||||||||||||
Cash dividends declared - preferred | [3],[4] | 0 | 0 | ||||||||||||
Stock option and incentive plans, net | [4] | 0 | 0 | ||||||||||||
Distributions to noncontrolling interests | [4] | 0 | 0 | ||||||||||||
Xerox Shareholders' Equity, Ending Balance | [4] | (3,772) | (4,010) | (3,772) | (4,010) | ||||||||||
Non-controlling Interests | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Noncontrolling Interests, Beginning Balance | $ 37 | $ 38 | 37 | 38 | |||||||||||
Cumulative effect of change in accounting principles(1) | [1] | 0 | |||||||||||||
Comprehensive income, net attributable to noncontrolling interests | 5 | 7 | |||||||||||||
Cash dividends declared - common | [2] | 0 | 0 | ||||||||||||
Cash dividends declared - preferred | [3] | 0 | 0 | ||||||||||||
Stock option and incentive plans, net | 0 | 0 | |||||||||||||
Distributions to noncontrolling interests | (11) | (10) | |||||||||||||
Noncontrolling Interests, Ending Balance | $ 31 | $ 35 | 31 | $ 35 | |||||||||||
Accounting Standards Update 2014-09 [Member] | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Cumulative effect of change in accounting principles(1) | 117 | ||||||||||||||
Accounting Standards Update 2016-01 [Member] | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Cumulative effect of change in accounting principles(1) | $ 3 | ||||||||||||||
|
Shareholders' Equity Share-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Stock-based compensation expense, pre-tax | $ 13 | $ 12 | $ 29 | $ 25 | |||||||||||||||||||||
Income tax benefit recognized in earnings | $ 3 | $ 3 | $ 7 | $ 6 | |||||||||||||||||||||
Performance share grant basis - performance | 0.6666666667 | ||||||||||||||||||||||||
Performance share grant basis - TSR | 0.3333333333 | ||||||||||||||||||||||||
Performance Shares [Member] | Performance-Based [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 667,000 | ||||||||||||||||||||||||
Fair Value | $ 28.07 | ||||||||||||||||||||||||
Performance Shares [Member] | TSR [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Term | 3 years | ||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 333,000 | ||||||||||||||||||||||||
Fair Value | [1] | $ 32.21 | |||||||||||||||||||||||
Risk Free Interest Rate | [2] | 2.39% | |||||||||||||||||||||||
Dividend Yield | [3] | 3.24% | |||||||||||||||||||||||
Volatility rate | [4] | 29.12% | |||||||||||||||||||||||
TSR historical volatility look back | 3 years | ||||||||||||||||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 1,012,000 | ||||||||||||||||||||||||
Fair Value | $ 28.03 | ||||||||||||||||||||||||
Equity Option [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Risk Free Interest Rate | [5] | 2.63% | |||||||||||||||||||||||
Dividend Yield | [6] | 3.25% | |||||||||||||||||||||||
Volatility rate | [7] | 27.25% | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term | [8] | 6 years 1 month 17 days | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,317,000 | ||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | [9] | $ 5.75 | |||||||||||||||||||||||
Graded vesting period [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Term | 3 years | ||||||||||||||||||||||||
Percent vested in year one | 25.00% | ||||||||||||||||||||||||
Percent vested in year two | 25.00% | ||||||||||||||||||||||||
Percent vested in year three | 50.00% | ||||||||||||||||||||||||
Graded vesting period [Member] | Equity Option [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Term | 3 years | ||||||||||||||||||||||||
Percent vested in year one | 25.00% | ||||||||||||||||||||||||
Percent vested in year two | 25.00% | ||||||||||||||||||||||||
Percent vested in year three | 50.00% | ||||||||||||||||||||||||
Cliff vesting [Member] | Performance Shares [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Term | 3 years | ||||||||||||||||||||||||
Cliff vesting [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Term | 3 years | ||||||||||||||||||||||||
Minimum [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Performance shares entitlement of original award grant | 0.00% | ||||||||||||||||||||||||
Maximum [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Performance shares entitlement of original award grant | 200.00% | ||||||||||||||||||||||||
Maximum [Member] | Performance Shares [Member] | Performance-Based [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Performance share maximum overachievement | 100.00% | ||||||||||||||||||||||||
80th and above | Performance Shares [Member] | TSR [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Payout as a percentage of target | [10] | 200.00% | |||||||||||||||||||||||
50th | Performance Shares [Member] | TSR [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Payout as a percentage of target | [10] | 100.00% | |||||||||||||||||||||||
25th | Performance Shares [Member] | TSR [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Payout as a percentage of target | [10] | 35.00% | |||||||||||||||||||||||
Below 25th | Performance Shares [Member] | TSR [Member] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||
Payout as a percentage of target | [10] | 0.00% | |||||||||||||||||||||||
|
Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
||||||||||||||
Other Comprehensive Income (Loss) [Abstract] | ||||||||||||||||||
Translation Adjustments (Losses) Gains, pre-tax | $ (335) | $ 204 | $ (151) | $ 338 | ||||||||||||||
Translation Adjustments (Losses) Gains, net of tax | [1] | (322) | 204 | (146) | 337 | |||||||||||||
Changes in fair value of cash flow hedges - (losses) gains, pre-tax | (2) | (22) | 10 | (13) | ||||||||||||||
Changes in fair value of cash flow hedges - (losses) gains, net of tax | (1) | (17) | 7 | (11) | ||||||||||||||
Changes in cash flow hedges reclassed to earnings, pre-tax | [2] | 0 | 4 | 12 | 8 | |||||||||||||
Changes in cash flow hedges reclassed to earnings, net of tax | [2] | 0 | 2 | 10 | 4 | |||||||||||||
Other (losses) gains, pre-tax | (2) | 1 | (3) | 1 | ||||||||||||||
Other (losses) gains, net of tax | (2) | 1 | (3) | 1 | ||||||||||||||
Net unrealized (losses) gains, pre-tax | (4) | (17) | 19 | (4) | ||||||||||||||
Net unrealized (losses) gains, net of tax | [1] | (3) | (14) | 14 | (6) | |||||||||||||
Net actuarial/prior service (losses) gains, pre-tax | (22) | (1) | 36 | (9) | ||||||||||||||
Net actuarial/prior service (losses) gains, net of tax | (16) | (1) | 27 | (6) | ||||||||||||||
Prior service amortization, pre-tax | [3] | (3) | (3) | (5) | (5) | |||||||||||||
Prior service amortization, net of tax | [3] | (3) | (2) | (4) | (3) | |||||||||||||
Actuarial loss amortization/settlement, pre-tax | [3] | 47 | 44 | 93 | 110 | |||||||||||||
Actuarial loss amortization/settlement, net of tax | [3] | 35 | 30 | 70 | 74 | |||||||||||||
Fuji Xerox changes in defined benefit plans, net, pre-tax | [4] | (3) | 8 | (24) | 21 | |||||||||||||
Fuji Xerox changes in defined benefit plans, net, net of tax | [4] | (3) | 8 | (24) | 21 | |||||||||||||
Other gains (losses), pre-tax | [5] | 77 | (64) | 39 | (89) | |||||||||||||
Other gains (losses), net of tax | [5] | 77 | (64) | 39 | (89) | |||||||||||||
Changes in defined benefit plans gains (losses), Pre-tax | 96 | (16) | 139 | 28 | ||||||||||||||
Changes in defined benefit plans gains (losses), Net of Tax | [1] | 90 | (29) | 108 | (3) | |||||||||||||
Other Comprehensive (Loss) Income, pre-tax | (243) | 171 | 7 | 362 | ||||||||||||||
Other Comprehensive (Loss) Income, net of tax | [1] | (235) | 161 | (24) | 328 | |||||||||||||
Less: Other comprehensive income attributable to noncontrolling interests, pre-tax | 0 | 0 | 0 | 1 | ||||||||||||||
Less: Other comprehensive income attributable to noncontrolling interests, net of tax | 0 | 0 | 0 | 1 | ||||||||||||||
Other Comprehensive (Loss) Income Attributable to Xerox, pre-tax | (243) | 171 | 7 | 361 | ||||||||||||||
Other Comprehensive (Loss) Income, Attributable to Xerox, net of tax | (235) | $ 161 | (24) | $ 327 | ||||||||||||||
Cumulative translation adjustments | (1,927) | (1,927) | $ (1,781) | |||||||||||||||
Other unrealized gains (losses), net | 2 | 2 | (12) | |||||||||||||||
Benefit plans net actuarial losses and prior service credits | [6] | (1,847) | (1,847) | (1,955) | ||||||||||||||
Total Accumulated other comprehensive loss attributable to Xerox | $ (3,772) | $ (3,772) | $ (3,748) | |||||||||||||||
|
Earnings per Share - Reconciliation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Basic Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Net loss from discontinued operations attributable to Xerox | $ 0 | $ 0 | $ 0 | $ (6) |
Continuing operations (dollars per share) | $ 0.42 | $ 0.64 | $ 0.50 | $ 0.81 |
Discontinued operations (dollars per share) | 0.00 | 0.00 | 0.00 | (0.03) |
Total Basic Earnings per Share | $ 0.42 | $ 0.64 | $ 0.50 | $ 0.78 |
Diluted Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Net loss from discontinued operations attributable to Xerox | $ 0 | $ 0 | $ 0 | $ (6) |
Common shares issuable with respect to: | ||||
Continuing operations (dollars per share) | $ 0.42 | $ 0.63 | $ 0.50 | $ 0.80 |
Discontinued operations (dollars per share) | 0.00 | 0.00 | 0.00 | (0.02) |
Total Diluted Earnings per Share | $ 0.42 | $ 0.63 | $ 0.50 | $ 0.78 |
Earnings (loss) per share, basic [Member] | ||||
Basic Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Accrued dividends on preferred stock | (3) | (3) | (7) | (7) |
Adjusted Net income from continuing operations available to common shareholders | 109 | 163 | 128 | 205 |
Net loss from discontinued operations attributable to Xerox | 0 | 0 | 0 | (6) |
Adjusted Net income available to common shareholders | $ 109 | $ 163 | $ 128 | $ 199 |
Weighted average common shares outstanding (in shares) | 254,895 | 254,193 | 254,791 | 254,107 |
Continuing operations (dollars per share) | $ 0.42 | $ 0.64 | $ 0.50 | $ 0.81 |
Discontinued operations (dollars per share) | 0.00 | 0.00 | 0.00 | (0.03) |
Total Basic Earnings per Share | $ 0.42 | $ 0.64 | $ 0.50 | $ 0.78 |
Diluted Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Accrued dividends on preferred stock | (3) | (3) | (7) | (7) |
Net loss from discontinued operations attributable to Xerox | $ 0 | $ 0 | $ 0 | $ (6) |
Weighted average common shares outstanding (in shares) | 254,895 | 254,193 | 254,791 | 254,107 |
Earnings (loss) per share, diluted [Member] | ||||
Basic Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Accrued dividends on preferred stock | (3) | 0 | (7) | (7) |
Net loss from discontinued operations attributable to Xerox | $ 0 | $ 0 | $ 0 | $ (6) |
Weighted average common shares outstanding (in shares) | 254,895 | 254,193 | 254,791 | 254,107 |
Diluted Earnings (Loss) per Share: | ||||
Net Income from Continuing Operations Attributable to Xerox | $ 112 | $ 166 | $ 135 | $ 212 |
Accrued dividends on preferred stock | (3) | 0 | (7) | (7) |
Adjusted Net income from continuing operations available to common shareholders | 109 | 166 | 128 | 205 |
Net loss from discontinued operations attributable to Xerox | 0 | 0 | 0 | (6) |
Adjusted Net income available to common shareholders | $ 109 | $ 166 | $ 128 | $ 199 |
Weighted average common shares outstanding (in shares) | 254,895 | 254,193 | 254,791 | 254,107 |
Common shares issuable with respect to: | ||||
Adjusted Weighted Average Common Shares Outstanding - Diluted (in shares) | 257,947 | 263,210 | 257,722 | 256,297 |
Continuing operations (dollars per share) | $ 0.42 | $ 0.63 | $ 0.50 | $ 0.80 |
Discontinued operations (dollars per share) | 0.00 | 0.00 | 0.00 | (0.02) |
Total Diluted Earnings per Share | $ 0.42 | $ 0.63 | $ 0.50 | $ 0.78 |
Earnings (loss) per share, diluted [Member] | Stock options [Member] | ||||
Common shares issuable with respect to: | ||||
Common shares attributable to dilutive effect of share-based payments(in shares) | 0 | 0 | 0 | 0 |
Earnings (loss) per share, diluted [Member] | Restricted Stock and Performance Shares [Member] | ||||
Common shares issuable with respect to: | ||||
Common shares attributable to dilutive effect of share-based payments(in shares) | 3,052 | 2,275 | 2,931 | 2,190 |
Earnings (loss) per share, diluted [Member] | Convertible Preferred Stock [Member] | ||||
Common shares issuable with respect to: | ||||
Common shares attributable to dilutive effect of share-based payments(in shares) | 0 | 6,742 | 0 | 0 |
Earnings per Share - Anti Dilutive Securities (Details) - $ / shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2018 |
Mar. 31, 2018 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 12,168 | 2,375 | 12,289 | 9,202 | ||
Dividends per common share (in dollars per share) | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.25 | $ 0.50 | $ 0.50 |
Stock options [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 1,097 | 0 | 1,097 | 0 | ||
Restricted Stock and Performance Shares [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 4,329 | 2,375 | 4,450 | 2,460 | ||
Convertible preferred stock [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Total anti-dilutive securities (in shares) | 6,742 | 0 | 6,742 | 6,742 |
Contingencies and Litigation (Details) $ in Millions |
1 Months Ended | ||||
---|---|---|---|---|---|
May 09, 2014 |
Feb. 28, 2018
complaint
class_action
|
Jun. 30, 2018
USD ($)
|
Jun. 18, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
|
Loss Contingencies [Line Items] | |||||
Loss Contingency, Damages Sought, Multiplier Of Overpayment Amounts | 2 | ||||
Pending Litigation [Member] | Transactions To Combine Xerox And Fuji Xerox [Member] | |||||
Loss Contingencies [Line Items] | |||||
Loss Contingency, New Claims Filed, Number | complaint | 5 | ||||
Loss Contingency, Number Of Class Actions Filed | class_action | 4 | ||||
Termination fee | $ 183 | ||||
Loss contingency, damages sought | $ 1,000 | ||||
Brazil Tax And Labor Contingencies [Member] | |||||
Loss Contingencies [Line Items] | |||||
Unreserved tax and labor contingencies | $ 510 | $ 600 | |||
Escrow cash deposits | 62 | ||||
Letters of Credit Outstanding, Amount | 113 | ||||
Surety Bonds Outstanding, Amount | 91 | ||||
Net Book Value Of Liened Assets | $ 0 |
Contingencies and Litigation - Other Contingencies (Details) $ in Millions |
Jun. 30, 2018
USD ($)
|
---|---|
Performance Guarantee [Member] | |
Guarantor Obligations [Line Items] | |
Maximum exposure, undiscounted | $ 328 |
Fuji Xerox Transaction and Recent Developments (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Jan. 31, 2018 |
|
Unsecured Debt [Member] | ||
Bridge Loan | $ 2,500 | |
Deferred debt issuance costs, write-off | $ 16 | |
Fuji Xerox | ||
Ownership percentage | 25.00% | |
Fuji Xerox | FUJIFILM | ||
Investment Owned, Percent of Net Assets | 75.00% | |
FUJIFILM | Xerox Corporation [Member] | ||
Investment Owned, Percent of Net Assets | 50.10% | |
Non-controlling Interests | Fuji Xerox | ||
Ownership percentage | 25.00% | |
Non-controlling Interests | Xerox Corporation [Member] | ||
Investment Owned, Percent of Net Assets | 49.90% | |
Expected special dividend | $ 2,500 |
Subsequent Event (Details) - Subsequent Event [Member] $ in Millions |
Jul. 31, 2018
USD ($)
|
---|---|
Subsequent Event [Line Items] | |
Stock Repurchase Program, Authorized Amount | $ 1,000 |
Remaining share authority written off | $ 245 |
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