Conduent Incorporated reported third‑quarter 2025 revenue of $767 million and an adjusted EBITDA margin of 5.2%, meeting management’s guidance and marking a year‑over‑year margin improvement. GAAP results showed a pre‑tax loss of $38 million and net loss of $46 million (‑$0.30 per share), while adjusted diluted EPS came in at ‑$0.09. Management reaffirmed its full‑year outlook for adjusted revenue of $3.05–$3.10 billion and adjusted EBITDA margin of 5.0%–5.5%. [1]
A brief snapshot from the Associated Press also noted the company missed Street revenue expectations (Zacks consensus: $794.3 million). [2]
Key takeaways
- Revenue & profitability: Q3 revenue $767M (‑5% y/y). Adjusted EBITDA $40M; margin 5.2% vs. 4.1% a year ago. Adjusted EPS ‑$0.09. [3]
- Guidance reiterated: FY25 adjusted revenue $3.05–$3.10B; adjusted EBITDA margin 5.0%–5.5%. [4]
- Sales pipeline: New business signings ACV $111M in Q3; trailing‑12‑month Net ARR activity $25M. [5]
- Liquidity & buybacks: Quarter‑end cash $264M; $198M of unused capacity under the renewed credit facility; ~4.7M shares repurchased in Q3. [6]
- Segments: Q3 revenue by segment — Commercial $367M, Government $238M, Transportation $162M. Remaining performance obligations (backlog proxy) ~$1.4B with ~73% expected over the next two years. [7]
Debt refinancing: maturities pushed, new performance L/C facility added
Conduent closed an August refinancing that fully prepaid its Term Loan A and reset the revolving credit facility to ~$357M, with $187M maturing Aug. 26, 2028 and $170M maturing Oct. 15, 2026. The company also added a $93M performance letter of credit facility maturing in 2028. Pricing flexes with leverage: SOFR + 1.75%–3.00% on the revolver (or base + 0.75%–2.00%) and a 0.30%–0.55% commitment fee; covenants include first‑lien net leverage ≤ 4.50x and fixed charge coverage ≥ 2.50x. [8]
Management highlighted the refinancing again in today’s release, noting the transaction extended maturities and improved financial flexibility. [9]
Where growth (and pressure) showed up in Q3
- Transportation rose to $162M (from $141M), helped by transit momentum; Conduent also won a pay‑by‑plate tolling contract with the Richmond Metropolitan Transportation Authority to support all‑electronic tolling. [10]
- Commercial posted $367M (vs. $385M a year ago), reflecting portfolio pruning and softness in certain offerings. [11]
- Government delivered $238M (vs. $255M), but management described public‑sector performance as resilient despite funding cycles. [12]
AI and product updates: from benefits delivery to finance analytics
Conduent says it integrated GenAI and advanced AI into government solutions to improve benefits disbursement, citizen experience, and fraud detection—part of a broader AI program the company has been rolling out across document processing and customer experience platforms. [13]
In late October, Conduent expanded its FastCap® Finance Analytics with GenAI‑powered contract and spend analytics, aimed at accelerating contract intake, verifying compliance, and surfacing procurement and tariff‑related risks. [14]
Additional operational updates this quarter included a new CXM facility in Lipa‑Malvar (Philippines) for a U.S. healthcare client and a deployment of the Maven® disease surveillance platform for the State of Delaware. [15]
Cash flow, cyber‑event costs, and capital allocation
Q3 operating cash flow was -$39M and adjusted free cash flow was -$54M, reflecting quarterly timing and items Conduent excludes from its adjusted metrics. The non‑GAAP reconciliations also identify “direct response costs – cyber event” associated with the January 2025 incident disclosed earlier this year. Management reiterated that 87% of its $1B capital allocation target has been achieved and expects to exceed it. [16]
Guidance and what to watch next
- FY25 outlook unchanged:Adjusted revenue $3.05–$3.10B and adjusted EBITDA margin 5.0%–5.5%. Execution on late‑year signings and ramp timing will be key to landing within the range. [17]
- Backlog conversion: With ~$1.4B in remaining performance obligations and ~73% due over two years, watch conversion to revenue and working‑capital effects on free cash flow. [18]
- Transportation & Public Sector: Follow transit and tolling wins (e.g., Richmond MTA) and any incremental AI‑driven wins in Government. [19]
- Balance sheet: The split‑maturity revolver and new performance L/C reduce near‑term risk, but investors will track leverage and covenant headroom as the company targets sustained margin expansion. [20]
By the numbers (Q3 2025)
- Revenue: $767M (vs. $807M in Q3 2024) — consensus miss per Zacks. [21]
- GAAP pre‑tax income (loss):-$38M; GAAP diluted EPS: -$0.30. [22]
- Adjusted EBITDA / margin:$40M / 5.2% (up 110 bps y/y). [23]
- Adjusted diluted EPS:-$0.09. [24]
- Cash & liquidity:$264M cash; $198M unused facility capacity at quarter‑end. [25]
- Share repurchases:~4.7M shares in Q3. [26]
- Refinancing details:Revolver ~$357M (maturities in 2026 and 2028), $93M performance L/C, pricing SOFR + 1.75%–3.00%; leverage covenant ≤ 4.50x. [27]
Sources
- Conduent Q3 2025 earnings release (figures, outlook, signings, AI initiatives, liquidity, buybacks). [28]
- SEC Form 10‑Q for the quarter ended Sept. 30, 2025 (segment results, backlog/RPO details). [29]
- AP/Zacks snapshot carried by San Francisco Chronicle (consensus context). [30]
- 8‑K (Aug. 26–27, 2025): Credit agreement Amendment No. 3 (refi terms & covenants). [31]
- GuruFocus brief on margin range (5%–5.5%). [32]
- Prior FastCap® GenAI expansion (Oct. 29, 2025) for product context. [33]
Editor’s note: This article is for informational purposes only and does not constitute investment advice. Always perform your own research.
References
1. www.globenewswire.com, 2. www.sfchronicle.com, 3. www.globenewswire.com, 4. www.globenewswire.com, 5. www.globenewswire.com, 6. www.globenewswire.com, 7. www.sec.gov, 8. www.sec.gov, 9. www.globenewswire.com, 10. www.sec.gov, 11. www.sec.gov, 12. www.sec.gov, 13. www.globenewswire.com, 14. investor.conduent.com, 15. www.globenewswire.com, 16. www.globenewswire.com, 17. www.globenewswire.com, 18. www.sec.gov, 19. www.globenewswire.com, 20. www.sec.gov, 21. www.globenewswire.com, 22. www.globenewswire.com, 23. www.globenewswire.com, 24. www.globenewswire.com, 25. www.globenewswire.com, 26. www.globenewswire.com, 27. www.sec.gov, 28. www.globenewswire.com, 29. www.sec.gov, 30. www.sfchronicle.com, 31. www.sec.gov, 32. www.gurufocus.com, 33. investor.conduent.com
