On Wednesday, Conduent Inc. ( CNDT ) reported a second-quarter 2024 revenue decline of 9.5% year over year to $828 million, beating the consensus of $803.33 million.

Adjusted revenue declined 4.7% YoY to $811 million. The new business annual contract value (ACV) totaled $142 million. Total operating costs and expenses declined 42.7% YoY to $528 million.

Adjusted EBITDA declined 54.7% year over year to $29 million, with margin contracting 390 bps year over year to 3.6%.

Adjusted EPS loss of $0.14 was down from $0.01 a year ago, beating the consensus loss estimate of $0.28.

Operating cash flow stood at negative $41 million, with an adjusted FCF of negative $55 million.

Conduent ( CNDT ) repurchased ~43.3 million shares in the quarter, including approximately 38 million shares of its common stock repurchased from Carl Icahn and affiliates.

The company exited the quarter with cash and equivalents worth $300 million. As of June end, its long-term debt was $789 million.

The company used the proceeds from the completed divestitures to prepay $300 million of principal of Term Loan B.

“Commercial sales were stronger on both a year-over-year and sequential basis and although Government sales is off to a slower than anticipated start to the year, our overall sales pipeline remains strong as does our balance sheet,” commented Cliff Skelton, Conduent ( CNDT ) President and Chief Executive Officer.

2024 Outlook: Conduent ( CNDT ) expects adjusted revenue of $3.325 billion – $3.375 billion. While releasing its first-quarter results, the company expected revenue of $3.60 billion – $3.70 billion.

The company reduced its adjusted EBITDA margin outlook from 8% – 9% to 4%- 5% for 2024.

Price Action: CNDT shares are trading lower by 9.52% at $3.23 on the last check Wednesday.

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