Xerox Holdings Corp. (NASDAQ:XRX) released its first-quarter 2026 results on Thursday.

The stock surged over 16%, as high short interest—exceeding 28% of the float—likely acted as a catalyst, amplifying buying pressure and accelerating the rally.

Revenue Surpasses Estimates Amid Earnings Miss

Xerox reported quarterly sales of $1.846 billion. This figure beat the analyst consensus estimate of $1.747 billion. It marks a significant increase from the $1.457 billion reported in the same period last year.

However, the company posted adjusted quarterly losses of 43 cents per share. This missed the analyst consensus estimate of a 27-cent loss. This result represents a wider loss compared to the 6 cents per share loss from the previous year, according to Benzinga Pro data.

Operational Improvements and Margin Expansion

Adjusted operating income reached $72 million, up $50 million year-over-year. The adjusted operating margin grew to 3.9%, a 240 basis point increase.

CEO Louie Pastor highlighted these gains in the Thursday release. "This quarter's results demonstrated tangible progress as revenue and profit trajectory improved," Pastor stated. He noted that the company is enhancing its liquidity position.

Strategic Milestones and Lexmark Synergies

The company is tracking at least $300 million in integration synergies from its Lexmark deal. Production installs jumped 31% year-over-year, supported by the Proficio launch.

Xerox also strengthened its balance sheet. It raised $450 million through an IP joint venture with TPG Angelo Gordon. By March 31, cash and cash equivalents totaled $585 million.

2026 Guidance Remains Firm

Management reaffirmed its full-year 2026 guidance. The company expects revenue above $7.5 billion. It targets free cash flow of approximately $250 million.

"I am genuinely optimistic about the future of this business," Pastor said. He added, "We are closer to an inflection point than the external narrative suggests."

XRX Price Action: Xerox Holdings shares were up 16.56% at $1.830 during premarket trading on Thursday, according to Benzinga Pro data.

Photo by T. Schneider via Shutterstock