Key Highlights

  • Revenue and Adjusted EBITDA margin at top-end of initial 2020 outlook, despite COVID headwinds.
  • Adjusted EBITDA margin improved year-over-year driven by business mix and efficient execution.
  • Adjusted Free Cash Flow conversion above top-end of initial guidance.
  • Strong New Business and revenue retention activity:
    • FY 2020 Total Contract Value (TCV) new business signings of $1,934M, an increase of 94% vs FY 2019.
    • FY 2020 Annual Recurring Revenue (ARR) signings of $353M, an increase of 26% vs FY 2019.

FLORHAM PARK, N.J., Feb. 18, 2021 -- Conduent (NASDAQ: CNDT), a business process services and solutions company, today announced its fourth quarter and full year 2020 financial results.

Cliff Skelton, Conduent CEO, stated “Despite a challenging macro environment, the team delivered on our financial commitments, met our clients' needs and strengthened the operational foundation of our business. We continue to focus on improving growth, quality and efficiency by leveraging improvements across our people, processes and technology environments. During 2020, we meaningfully improved both client retention and sales performance, overachieving on our initial sales goal and delivering 94% new business signings growth compared with 2019. We also added talent to the organization and enhanced client confidence within the year. Through the dedicated efforts of 63,000 Conduent associates, clients have rewarded us with expanded relationships, which is strong evidence that our strategy is working. While we have more hard work ahead of us, we are convinced that we will continue to drive value for our stakeholders and position Conduent for long-term success."

Key Financial Fourth Quarter & Full Year 2020 Results

($ in millions, except margin and per share data) Q4 20 Q4 19 Current Quarter Y/Y FY 20 FY 19 FY Y/Y
Revenue $1,055 $1,099 (4.0)% $4,163 $4,467 (6.8)%
Adjusted Revenue ( 1,2) 1,055 1,099 (4.0)% 4,163 4,431 (6.0)%
GAAP net loss from Continuing Operations (11) (581) (98.1)% (118) (1,934) (93.9)%
Adjusted EBITDA ( 2) 133 130 2.3% 480 493 (2.6)%
Adjusted EBITDA Margin 12.6% 11.8% 80 bps 11.5% 11.1% 40 bps
GAAP Pre-tax Income (11) (635) (98.3)% (139) (2,106) (93.4)%
GAAP Diluted EPS from Continuing Operations $(0.07) $(2.76) $2.69 $(0.61) $(9.29) $8.68
Adjusted Diluted EPS from Continuing Operations ( 2) $0.20 $0.18 $0.02 $0.62 $0.62 $—
Cash from Operations 172 348 (50.6)% 161 132 22.0%
Adjusted Free Cash Flow ( 3) 130 296 (56.1)% 145 60 141.7%

Q4 and Full Year 2020 Performance Commentary

Revenue for Q4 2020 compared with Q4 2019 was (4.0)% lower primarily due to prior lost business and the net COVID-19 impact, partially offset by new business ramp. COVID-19 impacts were approximately $(39)M of revenue in the quarter. The Commercial and Transportation business declines were driven primarily by COVID-19, whereas the Government business growth was driven by COVID-19.

Additional highlights from Q4 2020 include strong sales performance with $519M in new business signings, a 148% increase over Q4 2019.

Full Year 2020 adjusted revenue ( 1,2) compared with FY 2019 was (6.0)% lower primarily driven by net COVID-19 impacts and prior lost business. COVID-19 impacted revenue by approximately $(85)M in the year. Commercial and Transportation declines were primarily driven by COVID-19. The Government segment growth was driven by COVID-19, partially offset by a legacy contract loss.

Additional highlights from FY 2020 include strong sales performance with Total Contract Value of new business signings of $1,934M, up 94% year-over-year.

Additional 2020 Performance Highlights

Conduent continued to focus on Growth, Quality and Efficiency, achieving significant operational, client and associate-focused milestones throughout 2020, including:

  • Transitioned 32,000 associates to work-from-home at the peak of COVID-19, while meeting client service delivery requirements.
  • Strengthened talent & culture with associate engagement index up 8 percentage points year over year.
  • Opened a new global IT command center representing a significant enhancement to service quality for clients globally.
  • Established a global shared service operation, driving efficiency improvements.
  • Successfully migrated several data centers leading to system upgrades and security enhancements.
  • Continued to improve our client satisfaction metric for the second year in a row, with significant improvement in client Net Promoter Scores.

Brian Webb-Walsh, CFO, stated "We performed well in 2020, with results at or exceeding the top-end of the initial guidance ranges that we provided in February 2020. Our efficiency improvements positively impacted margins. Adjusted Free Cash Flow was particularly strong for 2020 and we ended the year with a strong balance sheet. We remain confident in our 2021 game plan and the progress we are making in positioning the company for top line growth."

2021 Outlook

  FY 2020 Actuals FY 2021 Outlook
Revenue $4,163M $4,000M - $4,150M
Adj. EBITDA / Adj. EBITDA Margin ( 2) $480M / 11.5% 11.0% - 11.5%
Adj. Free Cash Flow ( 3) as % of Adj. EBITDA (2) 30% Approx. 20%

Note: this guidance contemplates incremental benefit from anticipated legislation and continued COVID pressure in our Commercial and Government businesses.

(1) 2019 adjusted to exclude revenue from divested business.
(2) Refer to Appendix for complete Non-GAAP reconciliations of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Diluted EPS from Continuing Operations, and Adjusted Revenue.
(3) Refer to Appendix for definition and complete non-GAAP reconciliation of Adjusted Free Cash Flow.

Conference Call

Management will present the results during a conference call and webcast on February 18, 2021 at 5:00 p.m. ET.

The call will be available by live audio webcast along with the news release and online presentation slides at

The conference call will also be available by calling 1-877-407-4019 toll-free. If requested, the conference ID for this call is 13714802.

The international dial-in is 1-201-689-8337. The international conference ID is also 13714802.

A recording of the conference call will be available by calling 1-877-660-6853 one hour after the conference call concludes. The replay ID is 13714802.

The telephone recording will be available until March 4, 2021.

About Conduent

Conduent delivers mission-critical services and solutions on behalf of businesses and governments – creating exceptional outcomes for its clients and the millions of people who count on them. Through our dedicated people, process and technology, Conduent solutions and services automate workflows, improve efficiencies, reduce costs and enable revenue growth. It’s why most Fortune 100 companies and over 500 government entities depend on Conduent every day to manage their essential interactions and move their operations forward.

Conduent’s differentiated services and solutions improve experiences for millions of people every day, including three out of every four U.S. insured patients, 10 million employees who use its HR Services, and nearly 18 million benefits recipients. Conduent’s solutions deliver exceptional outcomes for its clients including $16 billion in savings from medical bill review of workers compensation claims, up to 40% efficiency increase in HR operations, up to 27% reduction in government benefits costs, up to 40% improvement in finance, accounting and procurement expense, and improved customer service interaction times by up to 20% with higher end-user satisfaction. Learn more at .

Non-GAAP Measures

We have reported our financial results in accordance with U.S. generally accepted accounting principles (GAAP). In addition, we have discussed our financial results using non-GAAP measures. We believe these non-GAAP measures allow investors to better understand the trends in our business and to better understand and compare our results. Accordingly, we believe it is necessary to adjust several reported amounts, determined in accordance with U.S. GAAP, to exclude the effects of certain items as well as their related tax effects. Management believes that these non-GAAP financial measures provide an additional means of analyzing the results of the current period against the corresponding prior period. These non-GAAP financial measures should be viewed in addition to, and not as a substitute for, our reported results prepared in accordance with U.S. GAAP. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable U.S. GAAP measures and should be read only in conjunction with our Consolidated Financial Statements prepared in accordance with U.S. GAAP. Our management regularly uses supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions, and providing such non-GAAP financial measures to investors allows for a further level of transparency as to how management reviews and evaluates our business results and trends. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is based in part on the performance of our business based on certain non-GAAP measures. Refer to the "Non-GAAP Financial Measures" section attached to this release for a discussion of these non-GAAP measures and their reconciliation to the reported U.S. GAAP measures.

Forward-Looking Statements

This release and any attachments to this release may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. The words “anticipate,” “believe,” “estimate,” “expect,” “plan,” “intend,” “will,” "aim," “should,” “could”, “may,” “continue to,” “if,” “growing,” “projected,” “potential,” “likely,” and similar expressions, as they relate to us, are intended to identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact included in this press release are forward-looking statements, including, but not limited to, statements regarding our financial results, condition and outlook; changes in our operating results; general market and economic conditions; our transformation progress; Net ARR Activity indicating potential annualized revenue impact; our continued focus on improving growth, quality and efficiency across our people, processes and technology; our strategy of continuing to drive value for clients and shareholders and positioning us for long-term success; expectations regarding the benefits of our permanent cost savings actions in 2021; our solid game plan for 2021; our belief that we are well positioned to continue our progress towards growth; and our projected financial performance for the full year 2021, including all statements made under the section captioned “2021 Outlook” within this release. In addition, all statements regarding the anticipated effects of the novel coronavirus ("COVID-19") pandemic and the responses thereto, including the pandemic’s impact on general economic and market conditions, as well as on our business, customers, and markets, results of operations and financial condition and anticipated actions to be taken by management to sustain our business during the economic uncertainty caused by the pandemic and related governmental and business actions, as well as other statements that are not strictly historical in nature, are forward looking. These statements reflect management's current beliefs, assumptions and expectations and are subject to a number of factors that may cause actual results to differ materially. As with any projection or forecast, forward-looking statements are inherently susceptible to uncertainty and changes in circumstances. Our actual results may vary materially from those expressed or implied in our forward-looking statements. These forward-looking statements are also subject to the significant continuing impact of the COVID-19 pandemic on our business, operations, financial results and financial condition, which is dependent on developments which are highly uncertain and cannot be predicted.

Important factors and uncertainties that could cause our actual results to differ materially from those in our forward-looking statements include, but are not limited to: government appropriations and termination rights contained in our government contracts; our ability to renew commercial and government contracts, including contracts awarded through competitive bidding processes; our ability to recover capital and other investments in connection with our contracts; our reliance on third-party providers; our ability to deliver on our contractual obligations properly and on time; changes in interest in outsourced business process services; risk and impact of geopolitical events, natural disasters and other factors (such as pandemics, including coronavirus) in a particular country or region on our workforce, customers and vendors; claims of infringement of third-party intellectual property rights; our ability to estimate the scope of work or the costs of performance in our contracts; the loss of key senior management and our ability to attract and retain necessary technical personnel and qualified subcontractors; increases in the cost of telephone and data services or significant interruptions in such services; our failure to develop new service offerings and protect our intellectual property rights; our ability to modernize our information technology infrastructure and consolidate data centers; the failure to comply with laws relating to individually identifiable information and personal health information; the failure to comply with laws relating to processing certain financial transactions, including payment card transactions and debit or credit card transactions; breaches of our information systems or security systems or any service interruptions; our ability to comply with data security standards; changes in tax and other laws and regulations; risk and impact of potential goodwill and other asset impairments; our significant indebtedness; our ability to obtain adequate pricing for our services and to improve our cost structure; our ability to collect our receivables, including those for unbilled services; a decline in revenues from, or a loss of, or a reduction in business from or failure of significant clients; fluctuations in our non-recurring revenue; our failure to maintain a satisfactory credit rating; our ability to receive dividends or other payments from our subsidiaries; developments in various contingent liabilities that are not reflected on our balance sheet, including those arising as a result of being involved in a variety of claims, lawsuits, investigations and proceedings; conditions abroad, including local economics, political environments, fluctuating foreign currencies and shifting regulatory schemes; changes in government regulation and economic, strategic, political and social conditions; the outcome of litigation to which we are a party from time to time; changes in the volatility of our stock price and the risk of litigation following a decline in the price of our stock; the impact of the ongoing COVID-19 pandemic; and other factors that are set forth in the “Risk Factors” section, the “Legal Proceedings” section, the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section and other sections in our Annual Reports on Form 10-K, as well as in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with or furnished to the Securities and Exchange Commission. Any forward-looking statements made by us in this release speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.

Media Contacts:
Sean Collins, Conduent, +1-310-497-9205,

Investor Contacts:
Alan Katz, Conduent, +1-973-526-7173,
Rebecca Conti Koar, Conduent, +1-862-308-7105,