CONDUENT Inc (CNDT) · Nov 5, 2026 · Earnings
Miss — Revenue $534M vs ~$546M consensus
Conduent’s Q3 earnings show better margins and reaffirmed guidance, but a revenue miss and $107M operating cash outflow complicate the turnaround.
Conduent is midway through ASCEND 2026–2028: simplifying around its Government and Commercial businesses, cutting costs, deploying AI, and exiting Transportation through the Transit and Tolling divestitures. The company recently extended its revolver maturities and added commitments, giving the transformation more runway, but the strategy still depends on converting cost savings and new-business wins into revenue and cash generation.
The quarter improved operating efficiency, but not the top line. Adjusted EBITDA rose to $36 million from $31 million and margin expanded to 6.7% from 5.1%, with the company also reporting a 3.0% margin in Q2. That is meaningful evidence that the cost program is working, and it helped adjusted operating income turn positive at $1 million versus a $10 million loss last year. But revenue fell 11.7% to $534 million and came in below the published consensus of roughly $546 million, so the margin progress is arriving mainly through cost reduction rather than growth.
| Q3 2026 | Q3 2025 | Consensus | |
|---|---|---|---|
| Revenue (Financial Highlights) | $534M (-11.7%) | $605M | ~$546M |
| Adjusted EBITDA (Financial Highlights) | $36M (+16.1%) | $31M | |
| Adjusted EBITDA margin (Financial Highlights) | 6.7% (+160 bps) | 5.1% | |
| Adjusted diluted EPS (Financial Highlights) | $(0.11) | $(0.11) | |
| Operating cash flow (Financial Highlights) | $(107)M | $(39)M | |
| Adjusted free cash flow (Financial Highlights) | $(117)M | $(54)M |
Cash conversion is the quarter’s biggest weakness. Operating cash flow deteriorated to negative $107 million from negative $39 million, as a temporary pause in receivables factoring created a major working-capital drag. 〔0〕 Management says year-to-date operating cash flow is slightly better than last year, but the quarterly outflow raises the importance of restoring factoring access and converting the reported EBITDA improvement into cash.
The outlook is intact, but the business still has to prove growth. Conduent reaffirmed its full-year 2026 outlook while reporting $106 million of identified savings against a $120 million target and $249 million of year-to-date new-business ACV wins. The completed $164 million Transit sale and expected year-end Tolling sale further narrow the portfolio, but they also make continuing-operations revenue comparisons less forgiving.
Bottom line: Conduent is executing the cost side of its turnaround, but this quarter did not yet show healthy growth or cash generation. Reaffirmed guidance limits the damage, yet the revenue miss and severe cash burn make the overall earnings read slightly negative.
Tolling business sale expected by year-end
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