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Loss from discontinued operations, net of tax

(6)

Less: Net income attributable to noncontrolling interests

Net income from continuing operations

$ 23

$ 46

Basic Earnings (Loss) per Share:

Continuing operations (dollars per share)

$ 0.08

$ 0.17

Discontinued operations (dollars per share)

0.00

(0.03)

Total Basic Earnings per Share

0.08

0.14

Diluted Earnings (Loss) per Share:

Continuing operations (dollars per share)

0.08

0.16

Discontinued operations (dollars per share)

0.00

(0.02)

Total Diluted Earnings per Share

$ 0.08

$ 0.14

[1]	Equity in net income of unconsolidated affiliates has been revised for the prior year period presented throughout this document. Refer to Note 2 - Correction of Fuji Xerox Misstatement in Prior Period Financial Statements for additional information on this revision.

Condensed Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Statement of Comprehensive Income [Abstract]

Less: Net income attributable to noncontrolling interests

$ 26

$ 42

Other Comprehensive Income, Net:

Changes in defined benefit plans, net

^[1]

176

133

Unrealized gains, net

^[1]

^[1]

Less: Other comprehensive income, net attributable to noncontrolling interests

^[1]

211

167

Other Comprehensive Income, Net Attributable to Xerox

211

166

Comprehensive Income, Net

Less: Comprehensive income, net attributable to noncontrolling interests

237

209

Accounting Changes and Error Corrections [Abstract]

$ 234

$ 206

[1]	Refer to Note 17 - Other Comprehensive Income for gross components of Other Comprehensive Income, reclassification adjustments out of Accumulated Other Comprehensive Loss and related tax effects.

Condensed Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Assets
Cash and cash equivalents	$ 1,398	$ 1,293
Accounts receivable, net	1,326	1,357
Billed portion of finance receivables, net	106	112
Finance receivables, net	1,301	1,317
Inventories	1,001	915
Other current assets	254	236
Total current assets	5,386	5,230
Finance receivables due after one year, net	2,278	2,323
Equipment on operating leases, net	448	454
Land, buildings and equipment, net	602	629
Investments in affiliates, at equity	1,378	1,404
Intangible assets, net	257	268
Goodwill	3,973	3,930
Deferred tax assets	942	1,026
Other long-term assets	911	682
Total Assets	16,175	15,946
Liabilities and Equity
Short-term debt and current portion of long-term debt	678	282
Accounts payable	1,188	1,108
Accrued compensation and benefits costs	427	444
Accrued expenses and other current liabilities	859	907
Total current liabilities	3,152	2,741
Long-term debt	4,811	5,235
Pension and other benefit liabilities	1,536	1,595
Post-retirement medical benefits	651	662
Other long-term liabilities	229	206
Total Liabilities	10,379	10,439
Commitments and Contingencies (See Note 19)
Convertible Preferred Stock	214	214
Common stock	255	255
Additional paid-in capital	3,908	3,893
Retained earnings	4,927	4,856
Accumulated other comprehensive loss	(3,537)	(3,748)
Xerox shareholders’ equity	5,553	5,256
Noncontrolling interests	29	37
Total Equity	5,582	5,293
Total Liabilities and Equity	$ 16,175	$ 15,946
Shares of common stock issued and outstanding (in shares)	254,679	254,613

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flows from Operating Activities:
Net Income	$ 26	$ 42
Loss from discontinued operations, net of tax	0	6
Income from continuing operations	26	48
Adjustments required to reconcile net income to cash flows from operating activities:
Depreciation and amortization	163	133
Provision for receivables	13	13
Provision for inventory	4	5
Net gain on sales of businesses and assets	(16)	0
Undistributed equity in net income of unconsolidated affiliates	68	(40)
Stock-based compensation	16	13
Restructuring and asset impairment charges	28	108
Payments for restructurings	(54)	(58)
Defined benefit pension cost	27	62
Contributions to defined benefit pension plans	(38)	(23)
Decrease (increase) in accounts receivable and billed portion of finance receivables	46	(77)
Increase in inventories	(87)	(58)
Increase in equipment on operating leases	(56)	(52)
Decrease in finance receivables	85	65
Increase in other current and long-term assets	(42)	(57)
Increase in accounts payable and accrued compensation	12	21
Increase (decrease) in other current and long-term liabilities	1	(1)
Net change in income tax assets and liabilities	13	(41)
Net change in derivative assets and liabilities	(6)	55
Other operating, net	13	16
Net cash provided by operating activities of continuing operations	216	132
Net cash used in operating activities of discontinued operations	0	(80)
Net cash provided by operating activities	216	52
Cash Flows from Investing Activities:
Cost of additions to land, buildings and equipment	(9)	(17)
Proceeds from sales of land, buildings and equipment	16	1
Cost of additions to internal use software	(9)	(9)
Acquisitions, net of cash acquired	0	(11)
Collections of deferred proceeds from sales of receivables	0	48
Collections on beneficial interest from sales of finance receivables	0	6
Other investing, net	0	(29)
Net cash used in investing activities	(2)	(11)
Cash Flows from Financing Activities:
Net (payments) proceeds on short-term debt	(1)	1
Proceeds from issuance of long-term debt	2	3
Payments on long-term debt	(38)	(1,328)
Common stock dividends	(64)	(81)
Preferred stock dividends	(3)	(6)
Repurchases related to stock-based compensation	(1)	(7)
Payments to noncontrolling interests	(12)	(1)
Other financing	0	161
Net cash used in financing activities	(117)	(1,258)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	9	9
Increase (decrease) in cash, cash equivalents and restricted cash	106	(1,208)
Cash, cash equivalents and restricted cash at beginning of period	1,368	2,402
Cash, Cash Equivalents and Restricted Cash at End of Period	$ 1,474	$ 1,194

Basis of Presentation Basis of Presentation	3 Months Ended
Basis of Presentation Basis of Presentation	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	Basis of Presentation References herein to “we,” “us,” “our,” the “company” and “Xerox” refer to Xerox Corporation and its consolidated subsidiaries unless the context suggests otherwise. We have prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with the accounting policies described in our 2017 Annual Report on Form 10-K ("2017 Annual Report") except as noted herein, and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. You should read these Condensed Consolidated Financial Statements in conjunction with the Consolidated Financial Statements included in our 2017 Annual Report. In our opinion, all adjustments which are necessary for a fair statement of financial position, operating results and cash flows for the interim periods presented have been made. These adjustments consist of normal recurring items. Interim results of operations are not necessarily indicative of the results of the full year. For convenience and ease of reference, we refer to the financial statement caption “Income (Loss) before Income Taxes and Equity Income” as “pre-tax income (loss).”

Correction of Fuji Xerox Misstatement in Prior Period Financial Statements

3 Months Ended

Mar. 31, 2018

Correction of Fuji Xerox Misstatement in Prior Period Financial Statements [Text Block]

Correction of Fuji Xerox Misstatement in Prior Period Financial Statements

Fuji Xerox is a joint venture between Xerox Corporation and Fujifilm Holdings Corporation (“Fujifilm”) in which Xerox holds a noncontrolling 25% equity interest and Fujifilm holds the remaining equity interest. In 2017 Fujifilm publicly announced it had formed an independent investigation committee ("IIC") to conduct a review of the appropriateness of the accounting practices at Fuji Xerox’s New Zealand subsidiary related to the recovery of receivables associated with certain bundled leasing transactions that occurred in, or prior to, Fuji Xerox’s fiscal year ending March 31, 2016.

The IIC’s review, completed during the second quarter 2017, identified total aggregate adjustments to Fuji Xerox's financial statements of approximately JPY 40 billion (approximately $360 based on the Yen/U.S. Dollar spot exchange rate at March 31, 2017 of 111.89). The adjustments identified by the IIC primarily related to misstatements at Fuji Xerox's New Zealand subsidiary as well as their Australian subsidiary and certain other adjustments. We determined that our cumulative share of the total aggregate adjustments identified as part of the investigation was approximately $90 and impacted our fiscal years 2009 through 2017.

In the second quarter 2017, we determined that the misstatements to our Equity in net income of unconsolidated affiliates in prior years and the first quarter of 2017 identified through the IIC's review were immaterial to our previously issued financial statements. However, we concluded that the cumulative correction of these misstatements would have had a material effect on our 2017 consolidated financial statements. Accordingly, we revised our previously issued consolidated financial statements for the first quarter of 2017. The effect of the revision on our previously issued financial statements is provided in the tables below. Amounts throughout the consolidated financial statements and notes thereto have been adjusted to incorporate the revised amounts, where applicable.

Refer to Note 10 - Investment in Affiliates, at Equity for a discussion regarding the correction of incremental misstatements and adjustments identified in 2018 and corrected by Fuji Xerox as part of their reported results for the quarter ended March 31, 2018 (our first quarter).

Revised Condensed Consolidated Statements of Income

The following tables reconcile selected lines from the company’s first quarter of 2017 Condensed Consolidated Statements of Income from the previously reported amounts to the revised amounts:



	Three Months Ended March 31, 2017
	As Reported		Adjustment		As Revised
Equity in net income of unconsolidated affiliates	$	16	$	24	$	40
Income from Continuing Operations	24		24		48
Net Income	18		24		42
Net Income Attributable to Xerox	16		24		40

Net income from continuing operations attributable to Xerox	$	22	$	24	$	46

Basic Earnings per Share:
Continuing operations	$	0.07	$	0.10	$	0.17
Total	$	0.05	$	0.09	$	0.14

Diluted Earnings per Share:
Continuing operations	$	0.07	$	0.09	$	0.16
Total	$	0.05	$	0.09	$	0.14

Revised Condensed Consolidated Statements of Comprehensive Income

The following tables reconcile selected lines from the company’s first quarter of 2017 Condensed Consolidated Statements of Comprehensive Income from the previously reported amounts to the revised amounts:



	Three Months Ended March 31, 2017
	As Reported		Adjustment			As Revised
Net Income	$	18	$	24		$	42
Net Income Attributable to Xerox	16		24			40

Translation adjustments, net	$	136	$	(3	)	$	133
Other Comprehensive Income, Net	170		(3		)	167
Other Comprehensive Income, Net Attributable to Xerox	169		(3		)	166

Comprehensive Income, Net	$	188	$	21		$	209
Comprehensive Income, Net Attributable to Xerox	185		21			206

Revised Condensed Consolidated Statements of Cash Flows from Operations

The revision did not have an impact on the company’s operating cash flows. The following table reconciles selected lines from the company’s first quarter of 2017 Condensed Consolidated Statements of Cash Flows from the previously reported amounts to the revised amounts:



	Three Months Ended March 31, 2017
	As Reported			Adjustment			As Revised
Cash Flows from Operating Activities:
Net Income	$	18		$	24		$	42
Income from Continuing Operations	24			24			48

Undistributed equity in net income of unconsolidated affiliates	$	(16	)	$	(24	)	$	(40	)

Adoption of New Revenue Recognition Standard

3 Months Ended

Mar. 31, 2018

Revenue from Contract with Customer [Abstract]

Adoption of New Revenue Recognition Standard

Adoption Summary:

On January 1, 2018 we adopted ASU 2014-09, Revenue from Contracts with Customers (ASC Topic 606), which superseded nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASC Topic 606 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASC Topic 606 defines a five step process to recognize revenue and requires more judgment and estimates within the revenue recognition process than required under previous U.S. GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation.

We adopted this standard using the modified retrospective method of adoption. Under ASC Topic 606, based on the nature of our contracts and consistent with prior practice, we recognize revenue upon invoicing the customer for the large majority of our revenue. Additionally, the unit of accounting, that is, the identification of performance obligations, is consistent with prior revenue recognition practice. Accordingly, the adoption of this standard did not have a material impact for the large majority of our revenues. Lastly, a significant portion of our equipment sales are either recorded as sales-type leases or through direct sales to distributors and resellers and these revenue streams are not impacted by the adoption of ASC Topic 606. The only change of significance identified in our adoption involves a change in the classification of certain revenues that were previously reported in Services revenues. These revenues, which are approximately $50 annually, relate to certain analyst services performed in connection with the installation of equipment that are being considered part of the equipment sale performance obligation in 2018. Accordingly, in 2018 these revenues are now reported as part of Sales. In the first quarter of 2018, as result of this change, $9 of revenue was recorded as Sales, which would have been previously recorded as Services revenue in prior periods.

Another change identified upon adoption was with respect to deferred contract costs, which include incremental costs of obtaining a contract and costs to fulfill a contract. Deferred contract costs had been minimal under our prior practices as most costs to obtain a contract and fulfill a contract were expensed as incurred. However, as a result of the contract cost guidance included in ASC Topic 606 and ASC Topic 340-40 "Contracts with Customers", upon adoption, we recorded a transition asset of $153, and a net of tax increase of $117 to retained earnings, related to the incremental cost to obtain contracts. Substantially all of this adjustment is related to the deferral of sales commissions paid to sales people and agents in connection with the placement of equipment with post sale service arrangements.

The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:



	As of March 31, 2018
	Superseded Revenue Guidance⁽¹⁾		Adjustments			As Reported
Deferred tax assets	$	976	$	(34	)	$	942
Other long-term assets	764		147			911
Retained earnings	4,814		113			4,927

____________


(1)	Reflects balance of account under revenue recognition guidance superseded by ASC Topic 606.

Revenue Recognition Summary:

We generate revenue through the sale of equipment, supplies and maintenance and printing services. Revenue is measured based on consideration specified in a contract with a customer and is recognized when we satisfy a performance obligation by transferring control of a product to a customer or in the period the customer benefits from the service. With the exception of our sales-type lease arrangements, our invoices to the customer, which normally have short-term payment terms, are typically aligned to the transfer of goods or as services are rendered to our customers and therefore in most cases we recognize revenue based on our right to invoice customers. As a result of the application of this practical expedient for the substantial portion of our revenue, the disclosure of the value of unsatisfied performance obligations for our services is not required.

Significant judgments primarily include the identification of performance obligations in our Document management services arrangements as well the pattern of delivery for those services.

More specifically, revenue related to our products and services is generally recognized as follows:

Equipment: Revenues from the sale of equipment directly to end customers, including those from sales-type leases (see below), are recognized when obligations under the terms of a contract with our customer are satisfied and control has been transferred to the customer. For equipment placements that require us to install the product at the customer location, revenue is normally recognized when the equipment has been delivered and installed at the customer location. Sales of customer installable products are recognized upon shipment or receipt by the customer according to the customer's shipping terms. Revenue from the equipment performance obligation also includes certain analyst training services performed in connection with the installation or delivery of the equipment.

Maintenance services: We provide maintenance agreements on our equipment that include service and supplies for which the customer may pay a base minimum plus a price-per-page charge for usage. In arrangements that include minimums, those minimums are normally set below the customer’s estimated page volumes and are not considered substantive. These agreements are sold as part of a bundled lease arrangement or through distributors and resellers. We normally account for these maintenance agreements as a single performance obligation for printing services being delivered in a series with delivery being measured by usage as billed to the customer. Accordingly, revenue on these agreements are normally recognized as billed to the customer over the term of the agreements based on page volumes. A substantial portion of our products are sold with full service maintenance agreements, accordingly, other than the product warranty obligations associated with certain of our entry level products, we do not have any significant warranty obligations, including any obligations under customer satisfaction programs.

Document management services: Revenues associated with our document management services are generally recognized as printing services are rendered, which is generally on the basis of the number of images produced. Revenues on unit-price contracts are recognized at the contractual selling prices as work is completed by the customer. We account for these arrangements as a single performance obligation for printing services being delivered in a series with delivery being measured by usage as billed to the customer.

Our services contracts may also include the sale or lease of equipment and software. In these instances we follow the policies noted for Equipment or Software Revenues and separately report the revenue associated with these performance obligations. Certain document management services arrangements may also include an embedded lease of equipment. In these instances the revenues associated with the lease are recognized in accordance with the requirements for lease accounting.

Sales to distributors and resellers: We utilize distributors and resellers to sell our equipment, supplies and maintenance services to end-user customers. We refer to our distributor and reseller network as our two-tier distribution model. Revenues on sales to distributors and resellers are generally recognized when products are shipped to such distributors and resellers. However, revenue is only recognized when the distributor or reseller has economic substance apart from the company such that collectability is probable and we have no further obligations related to bringing about the resale, delivery or installation of the product that would impact transfer of control. Revenues associated with maintenance agreements sold through distributors and resellers to end customers are recognized in a consistent manner to maintenance services. Revenue that may be subject to a reversal of revenue due to contractual terms or uncertainties are not recorded as revenue until the contractual provisions lapse or the uncertainties are resolved.

Distributors and resellers participate in various rebate, price-protection, cooperative marketing and other programs, and we estimate the variable consideration associated with these programs and record those amounts as a reduction to revenue when the sales occur. Similarly, we account for our estimates of sales returns and other allowances when the sales occur based on our historical experience.

In certain instances, we may provide lease financing to end-user customers who purchased equipment we sold to distributors or resellers. We are not obligated to provide financing and we compete with other third-party leasing companies with respect to the lease financing provided to these end-user customers.

Bundled Lease Arrangements: A significant portion of our direct sales of equipment to end customers are made through bundled lease arrangements, which typically include equipment, maintenance and financing components for which the customer pays a single negotiated fixed minimum monthly payment for all elements over the contractual lease term. These arrangements also typically include an incremental, variable component for page volumes in excess of contractual page volume minimums, which are often expressed in terms of price-per-page. The fixed minimum monthly payments are multiplied by the number of months in the contract term to arrive at the total fixed minimum payments that the customer is obligated to make (fixed payments) over the lease term. In applying our lease accounting methodology, we only consider the fixed payments for purposes of allocating to the relative fair value elements of the contract.

Revenues under bundled arrangements are allocated considering the relative standalone selling prices of the lease and non-lease deliverables included in the bundled arrangement. Lease deliverables include the equipment, financing, maintenance and other executory costs, while non-lease deliverables generally consist of the supplies and non-maintenance services. The allocation for the lease deliverables begins by allocating revenues to the maintenance and other executory costs plus a profit thereon. These elements are generally recognized over the term of the lease as service revenue. The remaining amounts are allocated to the equipment and financing elements which are subjected to the accounting estimates noted below under “Leases”.

Leases: The two primary lease accounting provisions we assess for the classification of transactions as sales-type or operating leases are: (1) a review of the lease term to determine if it is equal to or greater than 75% of the economic life of the equipment and (2) a review of the present value of the minimum lease payments to determine if they are equal to or greater than 90% of the fair market value of the equipment at the inception of the lease. Equipment placements included in arrangements meeting these conditions are accounted for as sales-type leases and revenue is recognized as noted above for Equipment. Equipment placements included in arrangements that don’t meet these conditions are accounted for as operating leases and revenue is recognized over the term of the lease.

We consider the economic life of most of our products to be five years, since this represents the most frequent contractual lease term for our principal products and only a small percentage of our leases are for original terms longer than five years. There is no significant after-market for our used equipment. We believe five years is representative of the period during which the equipment is expected to be economically usable, with normal service, for the purpose for which it is intended. Residual values are not significant.

With respect to fair value, we perform an analysis of equipment fair value based on cash selling prices during the applicable period. The cash selling prices are compared to the range of values determined for our leases. The range of cash selling prices must be reasonably consistent with the lease selling prices in order for us to determine that such lease prices are indicative of fair value.

Our lease pricing interest rates, which are used in determining customer payments in a bundled lease arrangement, are developed based upon a variety of factors including local prevailing rates in the marketplace and the customer’s credit history, industry and credit class. We reassess our pricing interest rates quarterly based on changes in the local prevailing rates in the marketplace. These interest rates have generally been adjusted if the rates vary by 25 basis points or more, cumulatively, from the rate last in effect. The pricing interest rates generally equal the implicit rates within the leases, as corroborated by our comparisons of cash to lease selling prices.

Software: Most of our equipment has both software and non-software components that function together to deliver the equipment's essential functionality and therefore they are accounted for together as part of equipment sales revenues. Software accessories sold in connection with our equipment sales, as well as free-standing software sales are accounted for as separate performance obligations if determined to be material in relation to the overall arrangement. Revenue from software is not a significant component of our Total revenues.

Supplies: Supplies revenue is recognized upon transfer of control to the customer, generally upon utilization or shipment to the customer in accordance with the sales contract terms.

Financing: Finance income attributable to sales-type leases, direct financing leases and installment loans is recognized on the accrual basis using the effective interest method.

Revenues disaggregated by primary geographic markets, major product lines, and sales channels are as follows:



	Three Months Ended March 31,
	2018		2017
Primary geographical markets⁽¹⁾:
United States	$	1,414	$	1,469
Europe	676		640
Canada	144		145
Other	201		200
Total Revenues	$	2,435	$	2,454

Major product and services lines:
Equipment⁽²⁾	$	499	$	502
Supplies, paper and other sales	434		434
Maintenance agreements⁽³⁾	631		640
Service arrangements⁽⁴⁾	623		622
Rental and other	177		180
Financing	71		76
Total Revenues	$	2,435	$	2,454

Sales channels:
Direct equipment lease⁽⁵⁾	$	160	$	160
Distributors & resellers⁽⁶⁾	331		321
Customer direct	442		455
Total Sales	$	933	$	936

_____________


(1)	Geographic area data is based upon the location of the subsidiary reporting the revenue.


(2)	2017 Equipment sale revenues exclude $11 of equipment-related training revenue, which was classified as Services under previous revenue guidance - see "Adoption Summary" above.


(3)	Includes revenues from maintenance agreements on sold equipment as well as revenues associated with service agreements sold in our small and mid-sized business (SMB) focused channels and through our channel partners as Xerox Partner Print Services (XPPS).


(4)	Primarily includes revenues from our Managed Document Services (MDS) offerings. Also includes revenues from embedded operating leases, which were not significant.


(5)	Primarily reflects direct sales through bundled lease arrangements.


(6)	Primarily reflects sales through our two-tier distribution channels.

Other Revenue Recognition Policies

Contract assets and liabilities: We normally do not have contract assets, which are primarily unbilled accounts receivable that are conditional on something other than the passage of time. Our contract liabilities, which represent billings in excess of revenue recognized, are primarily related to advanced billings for maintenance and other services to be performed and were approximately $87 and $91 at March 31, 2018 and January, 1, 2018, respectively. The majority of the balance at March 31, 2018 will be amortized to revenue over approximately the next 30 months.

Contract Costs: Incremental direct costs of obtaining a contract primarily include sales commissions paid to sales people and agents in connection with the placement of equipment with associated post sale services arrangements. These costs are deferred and amortized on the straight-line basis over the estimated contract term, which is currently estimated to be approximately four years. We pay commensurate sales commissions upon customer renewals, therefore our amortization period is aligned to our initial contract term.

In the first quarter 2018, incremental direct costs of obtaining a contract of $17 were deferred and amortization was $24. The balance of deferred incremental direct costs net of accumulated amortization at March 31, 2018 was $179. This amount is expected to be amortized over its estimated period of benefit, which we currently estimate to be approximately four years.

We may also incur costs associated with our services arrangements to generate or enhance resources and assets that will be used to satisfy our future performance obligations included in these arrangements. These costs are considered contract fulfillment costs. These costs are amortized over the contractual service period of the arrangement to cost of services. In addition, we also provide inducements to certain customers in various forms, including contractual credits, which are capitalized and amortized as a reduction of revenue over the term of the contract. Amounts deferred associated with contract fulfillment costs and inducements were $10 at March 31, 2018.

Equipment and software used in the fulfillment of service arrangements and where the company retains control are capitalized and depreciated over the shorter of their useful life or the term of the contract if an asset is contract specific.

Revenue-based Taxes: Revenue-based taxes assessed by governmental authorities that are both imposed on and concurrent with specific revenue-producing transactions, and that are collected by the company from a customer, are excluded from revenue. The primary revenue-based taxes are sales tax and value-added tax (VAT).

Shipping and Handling: Shipping and handling costs are accounted for as a fulfillment cost and are included in Cost of sales in the Condensed Consolidated Statements of Income.

Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

Leases

In February 2016, the FASB issued ASU 2016-02, Leases. This update requires the recognition of leased assets and lease obligations by lessees for those leases currently classified as operating leases under existing lease guidance. Short term leases with a term of 12 months or less are not required to be recognized. The update also requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. The accounting for lessors does not fundamentally change except for changes to conform and align guidance to the lessee guidance as well as to the new revenue recognition guidance in ASU 2014-09. This update is effective for our fiscal year beginning January 1, 2019. We are currently evaluating the impact of the adoption of ASU 2016-02 on our consolidated financial statements. The aggregate undiscounted value of our operating lease commitments at December 31, 2017 was approximately $450 and was primarily related to leases of facilities.

Financial Instruments - Credit Losses

In June 2016, the FASB issued ASU 2016-13, Financial Instruments Credit Losses - Measurement of Credit Losses on Financial Instruments, which requires measurement and recognition of expected credit losses for financial assets. The update impacts financial assets and net investment in leases that are not accounted for at fair value through net income. This update is effective for our fiscal year beginning January 1, 2020, with early adoption permitted as of January 1, 2019. We are currently evaluating the impact of the adoption of ASU 2016-13 on our consolidated financial statements.

Cash Flows

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments. This update provides specific guidance on eight cash flow classification issues where current guidance is either unclear or does not include specific requirements. We adopted ASU 2016-15 effective for our fiscal year beginning January 1, 2018. This update includes specific guidance which requires cash collected on beneficial interests received in a sale of receivables be classified as inflows from investing activities. Currently, those collections are reported in operating cash flows. We reported $54 of collections on beneficial interests as operating cash inflows on the Statement of Cash Flows for the three months ended March 31, 2017. Accordingly, since the update must be applied retrospectively, our reported 2017 operating and investing cash flows were revised in 2018 to report this amount as investing cash flows. There is no expected impact to our 2018 cash flows from this reporting change due to the termination of all accounts receivable sales arrangements in North America and most arrangements in Europe and the final repurchase of previously sold finance receivables during the fourth quarter of 2017. The other seven issues noted in this update are not expected to have a material impact on our financial condition, results of operations or cash flows.

Additionally, in November 2016 the FASB issued ASU 2016-18, Statement of Cash Flows - Restricted Cash. The update requires that amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted ASU 2016-18 effective for our fiscal year beginning January 1, 2018 and applied it retrospectively through a revision of previously reported amounts. We held $76 and $75 of restricted cash, currently reported in other current or long-term assets at March 31, 2018 and December 31, 2017, respectively. The changes in our restricted cash balances were primarily related to our accounts receivable sales programs, which were terminated during the fourth quarter of 2017. Accordingly, this update is not expected to have a material impact on our financial condition, results of operations or cash flows. Refer to Note 6 - Cash, Cash Equivalents and Restricted Cash for additional information.

Retirement Benefits

In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This update changes how employers that sponsor defined benefit pension plans and other postretirement plans present net periodic benefit costs in the income statement. An employer is required to report the service cost component in the same line item or items as other compensation costs arising from services rendered by the affected employees during the period. Other components of net retirement benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. We elected to report these costs as a separate item within Other expenses, net. The update also allows only the service cost component to be eligible for capitalization, when applicable. We adopted ASU 2017-07 effective for us beginning January 1, 2018. The presentation requirements of this update were required to be applied retrospectively through a revision of previously reported amounts. The requirement to limit capitalization to the service cost component was required to be applied prospectively. The adoption of this update is not expected to have a material impact on our financial condition, results of operations or cash flows. Refer to Note 15 - Employee Benefit Plans for the service cost component and other components of net retirement benefit cost.

The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:



	Three Months Ended March 31, 2017
(in millions)	As Reported		Adjustment			As Recasted
Cost of sales	$	567	$	(2	)	$	565
Costs of services, maintenance and rentals	900		(19		)	881
Research, development and engineering expenses	118		(7		)	111
Selling, administrative and general expenses	664		(30		)	634
Restructuring and related costs	120		(2		)	118
Other expenses, net	54		60			114

Business Combinations

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. We adopted ASU 2017-01 effective for our fiscal year beginning January 1, 2018 and the adoption did not have nor is it expected to have a material impact on our financial condition, results of operations or cash flows.

Income Taxes

In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other than Inventory. This update requires recognition of the income-tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. Under current GAAP, recognition of the income tax consequences for asset transfers other than inventory could not be recognized until the asset was sold to a third party. We adopted ASU 2016-16 effective for our fiscal year beginning January 1, 2018 and the adoption did not have nor is it expected to have a material impact on our financial condition, results of operations or cash flows.

In February 2018, the FASB issued ASU No, 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The update allows the reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act ("Tax Act") enacted in December 2017. Consequently, the update eliminates the stranded tax effects resulting from the Tax Act and will improve the usefulness of information reported to financial statement users. However, because the update only relates to the reclassification of the income tax effects of the Tax Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The update also requires certain disclosures about stranded tax effects. The update is effective for our fiscal year beginning January 1, 2019. Early adoption of this update is permitted, including adoption in any interim period. The update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The company is currently evaluating the impact of adopting this new guidance.

In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") No. 118 (as further clarified by the FASB's ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118) to provide guidance for companies that may not have completed their accounting for the income tax effects of the Tax Act. SAB No. 118 provides for a provisional one year measurement period for entities to finalize their accounting for certain income tax effects related to the Tax Act. SAB No. 118 provides guidance where: (i) the accounting for the income tax effect of the Tax Act is complete and reported in the Tax Act's enactment period, (ii) the accounting for the income tax effect of the Tax Act is incomplete and reported as provisional amounts based on reasonable estimates (to the extent determinable) subject to adjustments during a limited measurement period until complete, and (iii) accounting for the income tax effect of the Tax Act is not reasonably estimable (no related provisional amounts are reported in the enactment period) and entities would continue to apply accounting based on tax law provisions in effect prior to the Tax Act enactment until provisional amounts are reasonably estimable. SAB No. 118 requires disclosure of the reasons for incomplete accounting additional information or analysis needed, among other relevant information. During the fourth quarter 2017, we recorded an estimated non-cash provisional charge of $400 reflecting the impact associated with the provisions of the Tax Act based on currently available information. No further adjustment of that estimated provisional charge was made in the first quarter 2018, however we continue to evaluate impacts from the Tax Act and likely will do so through the expected filing of our 2017 U.S. Tax Return in the third quarter 2018. Any adjustments to these provisional amounts will be reported as a component of Income tax expense in the reporting period in which any such adjustments are determined.

Derivatives

In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The amendments in this update expand and refine hedge accounting for both financial and non-financial risk components, aligns the recognition and presentation of the effects of hedging instruments with the same income statement line item that the hedged item is reported and includes certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. This update is effective for our fiscal year beginning January 1, 2019, with early adoption permitted at any interim period. We are currently evaluating the impact of the adoption of ASU 2017-12 on our consolidated financial statements.

Other Updates

In 2018, 2017 and 2016, the FASB also issued the following Accounting Standards Updates which did not have or are not expected to have a material impact on our financial condition, results of operations or cash flows upon adoption. Those updates are as follows:


•	Investments - Debt Securities and Regulated Operations: ASU 2018-04, (Topics 320 and 980) Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273 (SEC Update).


•	Leases: ASU 2018-01, (Topic 842) Land Easement Practical Expedient for Transition to Topic 842. This update is effective for our fiscal year beginning January 1, 2019.


•	Service Concession Arrangements: ASU 2017-10, (Topic 853) Determining the Customer of the Operation Services (a consensus of the FASB Emerging Issues Task Force). This update is effective for our fiscal year beginning January 1, 2018.


•	Compensation - Stock Compensation: ASU 2017-09, (Topic 718) Scope of Modification Accounting. This update is effective for our fiscal year beginning January 1, 2018.


•	Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets: ASU 2017-05, (Subtopic 610-20) Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. This update is effective for our fiscal year beginning January 1, 2018.


•	Financial Instruments - Classification and Measurement: ASU 2016-01, Financial Instruments - Recognition and Measurement of Financial Instruments and Financial Liabilities. This update is effective for our fiscal year beginning January 1, 2018.

Divestitures

3 Months Ended

Mar. 31, 2018

Discontinued Operations and Disposal Groups [Abstract]

Divestitures

Business Process Outsourcing (BPO)

On December 31, 2016, Xerox completed the Separation of its BPO business through the Distribution of all of the issued and outstanding stock of Conduent to Xerox Corporation stockholders. As a result of the Separation and Distribution, the financial position and results of operations of the BPO business are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. The loss from operations in the first quarter 2017 primarily reflected changes in estimates of separation-related costs.

Summarized financial information for our Discontinued Operations is as follows:



	Three Months Ended March 31,
	2018		2017
Loss from operations	$	—	$	8
Loss on disposal	—		—
Net loss before income taxes	—		(8		)
Income tax benefit	—		2
Loss from discontinued operations, net of tax	$	—	$	(6	)

Cash, Cash Equivalents and Restricted Cash Cash, Cash Equivalents and Restricted Cash

3 Months Ended

Mar. 31, 2018

Cash, Cash Equivalents and Restricted Cash [Abstract]

Cash, Cash Equivalents and Restricted Cash [Text Block]

Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash amounts were as follows:



	March 31, 2018		December 31, 2017
Cash and cash equivalents	$	1,398	$	1,293
Restricted cash
Tax and labor litigation deposits in Brazil	72		72
Other restricted cash	4		3
Total Restricted cash	76		75
Cash, cash equivalents and restricted cash	$	1,474	$	1,368

Restricted Cash

Restricted cash primarily relates to escrow cash deposits made in Brazil associated with tax and labor litigation. As more fully discussed in Note 19 - Contingencies and Litigation, various litigation matters in Brazil require us to make cash deposits to escrow as a condition of continuing the litigation. Restricted cash amounts are classified in our Condensed Consolidated Balance Sheets based on when the cash is expected to be contractually or judicially released.

Restricted cash was reported in the Condensed Consolidated Balance Sheet as follows:



	March 31, 2018		December 31, 2017
Other current assets	$	2	$	1
Other long-term assets	74		74
Total Restricted cash	$	76	$	75

Accounts Receivable, Net

3 Months Ended

Mar. 31, 2018

Receivables [Abstract]

Accounts Receivable, Net

Accounts receivable, net were as follows:



	March 31, 2018			December 31, 2017
Invoiced	$	1,033		$	1,048
Accrued	352			368
Allowance for doubtful accounts	(59		)	(59		)
Accounts receivable, net	$	1,326		$	1,357

Amounts to be invoiced in the subsequent quarter for current services provided are included in amounts accrued.

We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. The allowance for uncollectible accounts receivable is determined principally on the basis of past collection experience as well as consideration of current economic conditions and changes in our customer collection trends.

Accounts Receivable Sales Arrangements

Accounts receivable sales arrangements are utilized in the normal course of business as part of our cash and liquidity management. The accounts receivable sold are generally short-term trade receivables with payment due dates of less than 60 days. During the fourth quarter 2017 we terminated all accounts receivable sales arrangements in North America and all but one arrangement in Europe. The remaining facility in Europe enables us to sell accounts receivable associated with our distributor network on an ongoing basis without recourse. Under this arrangement, we sell our entire interest in the related accounts receivable for cash and no portion of the payment is held back or deferred by the purchaser.

Of the accounts receivable sold and derecognized from our balance sheet, $114 and $161 remained uncollected as of March 31, 2018 and December 31, 2017, respectively.

Accounts receivable sales were as follows:



	Three Months Ended March 31,
	2018			2017
Accounts receivable sales⁽¹⁾	$	103		$	511
Deferred proceeds	—			52
Loss on sales of accounts receivable	1			3
Estimated decrease to operating cash flows⁽²⁾	(50		)	(65		)

__________________________

(1)

Customers may also enter into structured-payable arrangements that require us to sell our receivables from that customer to a third-party financial institution, which then makes payments to us to settle the customer's receivable. In these instances we ensure the sale of the receivables are bankruptcy remote and the payment made to us is without recourse. The activity associated with these arrangements is not reflected in this disclosure as payments under these arrangements have not been material and these are customer directed arrangements.


(2)	Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency.

Finance Receivables, Net

Finance Receivables – Allowance for Credit Losses and Credit Quality

Finance receivables include sales-type leases, direct financing leases and installment loans arising from the marketing of our equipment. Our finance receivable portfolios are primarily in the U.S., Canada and Europe. We generally establish customer credit limits and estimate the allowance for credit losses on a country or geographic basis. Our policy and methodology used to establish our allowance for doubtful accounts has been consistently applied over all periods presented.

The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:



Allowance for Credit Losses:	United States			Canada			Europe			Other⁽¹⁾		Total
Balance at December 31, 2017	$	56		$	15		$	35		$	2	$	108
Provision	5			—			4			—		9
Charge-offs	(5		)	(1		)	(4		)	—		(10		)
Recoveries and other⁽²⁾	—			—			1			—		1
Balance at March 31, 2018	$	56		$	14		$	36		$	2	$	108
Finance receivables as of March 31, 2018 collectively evaluated for impairment ⁽³⁾	$	1,994		$	373		$	1,364		$	62	$	3,793

Balance at December 31, 2016	$	55		$	16		$	37		$	2	$	110
Provision	4			—			5			—		9
Charge-offs	(6		)	(2		)	(2		)	—		(10		)
Recoveries and other⁽²⁾	—			2			—			—		2
Balance at March 31, 2017	$	53		$	16		$	40		$	2	$	111
Finance receivables as of March 31, 2017 collectively evaluated for impairment⁽³⁾	$	2,108		$	382		$	1,276		$	51	$	3,817

__________________


(1)	Includes developing market countries and smaller units.


(2)	Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations.


(3)	Total Finance receivables exclude the allowance for credit losses of $108 and $111 at March 31, 2018 and 2017, respectively.

We evaluate our customers based on the following credit quality indicators:

•

Investment grade: This rating includes accounts with excellent to good business credit, asset quality and capacity to meet financial obligations. These customers are less susceptible to adverse effects due to shifts in economic conditions or changes in circumstance. The rating generally equates to a Standard & Poor's (S&P) rating of BBB- or better. Loss rates in this category are normally less than 1%.

•

Non-investment grade: This rating includes accounts with average credit risk that are more susceptible to loss in the event of adverse business or economic conditions. This rating generally equates to a BB S&P rating. Although we experience higher loss rates associated with this customer class, we believe the risk is somewhat mitigated by the fact that our leases are fairly well dispersed across a large and diverse customer base. In addition, the higher loss rates are largely offset by the higher rates of return we obtain with such leases. Loss rates in this category are generally in the range of 2% to 5%.

•

Substandard: This rating includes accounts that have marginal credit risk such that the customer’s ability to make repayment is impaired or may likely become impaired. We use numerous strategies to mitigate risk including higher rates of interest, prepayments, personal guarantees, etc. Accounts in this category include customers who were downgraded during the term of the lease from investment and non-investment grade evaluation when the lease was originated. Accordingly, there is a distinct possibility for a loss of principal and interest or customer default. The loss rates in this category are generally in the range of 7% to 10%.

Credit quality indicators are updated at least annually and the credit quality of any given customer can change during the life of the portfolio. Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:



	March 31, 2018								December 31, 2017
	Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables		Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables
Finance and other services	$	193	$	334	$	82	$	609	$	199	$	345	$	75	$	619
Government and education	480		62		6		548		490		61		6		557
Graphic arts	86		93		133		312		84		97		141		322
Industrial	80		84		15		179		82		84		14		180
Healthcare	90		46		8		144		88		48		9		145
Other	66		95		41		202		68		98		40		206
Total United States	995		714		285		1,994		1,011		733		285		2,029
Finance and other services	52		39		26		117		54		42		27		123
Government and education	44		5		4		53		48		5		5		58
Graphic arts	30		33		27		90		34		35		27		96
Industrial	19		11		11		41		20		12		11		43
Other	34		23		15		72		36		25		16		77
Total Canada	179		111		83		373		192		119		86		397
France	244		213		23		480		234		226		22		482
U.K./Ireland	109		145		11		265		106		150		10		266
Central⁽¹⁾	196		144		16		356		189		149		16		354
Southern⁽²⁾	46		153		14		213		52		144		13		209
Nordics⁽³⁾	29		20		1		50		29		21		1		51
Total Europe	624		675		65		1,364		610		690		62		1,362
Other	38		21		3		62		38		28		6		72
Total	$	1,836	$	1,521	$	436	$	3,793	$	1,851	$	1,570	$	439	$	3,860

_____________________________


(1)	Switzerland, Germany, Austria, Belgium and Holland.


(2)	Italy, Greece, Spain and Portugal.


(3)	Sweden, Norway, Denmark and Finland.

The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:



	March 31, 2018
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	14	$	3	$	1	$	18	$	591	$	609	$	11
Government and education	16		4		3		23		525		548		26
Graphic arts	12		1		—		13		299		312		5
Industrial	5		1		1		7		172		179		4
Healthcare	4		1		1		6		138		144		4
Other	6		1		1		8		194		202		3
Total United States	57		11		7		75		1,919		1,994		53
Canada	8		2		1		11		362		373		19
France	7		—		—		7		473		480		16
U.K./Ireland	1		1		—		2		263		265		—
Central⁽¹⁾	1		1		1		3		353		356		6
Southern⁽²⁾	4		1		1		6		207		213		8
Nordics⁽³⁾	1		—		—		1		49		50		—
Total Europe	14		3		2		19		1,345		1,364		30
Other	3		—		—		3		59		62		—
Total	$	82	$	16	$	10	$	108	$	3,685	$	3,793	$	102

	December 31, 2017
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	18	$	3	$	1	$	22	$	597	$	619	$	12
Government and education	18		3		3		24		533		557		21
Graphic arts	12		1		—		13		309		322		6
Industrial	6		1		1		8		172		180		4
Healthcare	5		1		1		7		138		145		5
Other	7		1		1		9		197		206		3
Total United States	66		10		7		83		1,946		2,029		51
Canada	8		2		1		11		386		397		17
France	6		—		—		6		476		482		22
U.K./Ireland	3		—		—		3		263		266		—
Central⁽¹⁾	1		2		—		3		351		354		6
Southern⁽²⁾	4		1		1		6		203		209		6
Nordics⁽³⁾	—		—		—		—		51		51		—
Total Europe	14		3		1		18		1,344		1,362		34
Other	3		—		—		3		69		72		—
Total	$	91	$	15	$	9	$	115	$	3,745	$	3,860	$	102

_____________________________

(1)Switzerland, Germany, Austria, Belgium and Holland.

(2)Italy, Greece, Spain and Portugal.

(3)Sweden, Norway, Denmark and Finland.

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

Financing Receivable, Net [Abstract]

Finance Receivables, Net

3 Months Ended

Mar. 31, 2018

Finance Receivables, Net

Accounts Receivable, Net

Accounts receivable, net were as follows:



	March 31, 2018			December 31, 2017
Invoiced	$	1,033		$	1,048
Accrued	352			368
Allowance for doubtful accounts	(59		)	(59		)
Accounts receivable, net	$	1,326		$	1,357

Amounts to be invoiced in the subsequent quarter for current services provided are included in amounts accrued.

Accounts Receivable Sales Arrangements

Of the accounts receivable sold and derecognized from our balance sheet, $114 and $161 remained uncollected as of March 31, 2018 and December 31, 2017, respectively.

Accounts receivable sales were as follows:



	Three Months Ended March 31,
	2018			2017
Accounts receivable sales⁽¹⁾	$	103		$	511
Deferred proceeds	—			52
Loss on sales of accounts receivable	1			3
Estimated decrease to operating cash flows⁽²⁾	(50		)	(65		)

__________________________

(1)


(2)	Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency.

Finance Receivables, Net

Finance Receivables – Allowance for Credit Losses and Credit Quality

The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:



Allowance for Credit Losses:	United States			Canada			Europe			Other⁽¹⁾		Total
Balance at December 31, 2017	$	56		$	15		$	35		$	2	$	108
Provision	5			—			4			—		9
Charge-offs	(5		)	(1		)	(4		)	—		(10		)
Recoveries and other⁽²⁾	—			—			1			—		1
Balance at March 31, 2018	$	56		$	14		$	36		$	2	$	108
Finance receivables as of March 31, 2018 collectively evaluated for impairment ⁽³⁾	$	1,994		$	373		$	1,364		$	62	$	3,793

Balance at December 31, 2016	$	55		$	16		$	37		$	2	$	110
Provision	4			—			5			—		9
Charge-offs	(6		)	(2		)	(2		)	—		(10		)
Recoveries and other⁽²⁾	—			2			—			—		2
Balance at March 31, 2017	$	53		$	16		$	40		$	2	$	111
Finance receivables as of March 31, 2017 collectively evaluated for impairment⁽³⁾	$	2,108		$	382		$	1,276		$	51	$	3,817

__________________


(1)	Includes developing market countries and smaller units.


(2)	Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations.


(3)	Total Finance receivables exclude the allowance for credit losses of $108 and $111 at March 31, 2018 and 2017, respectively.

We evaluate our customers based on the following credit quality indicators:

•



	March 31, 2018								December 31, 2017
	Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables		Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables
Finance and other services	$	193	$	334	$	82	$	609	$	199	$	345	$	75	$	619
Government and education	480		62		6		548		490		61		6		557
Graphic arts	86		93		133		312		84		97		141		322
Industrial	80		84		15		179		82		84		14		180
Healthcare	90		46		8		144		88		48		9		145
Other	66		95		41		202		68		98		40		206
Total United States	995		714		285		1,994		1,011		733		285		2,029
Finance and other services	52		39		26		117		54		42		27		123
Government and education	44		5		4		53		48		5		5		58
Graphic arts	30		33		27		90		34		35		27		96
Industrial	19		11		11		41		20		12		11		43
Other	34		23		15		72		36		25		16		77
Total Canada	179		111		83		373		192		119		86		397
France	244		213		23		480		234		226		22		482
U.K./Ireland	109		145		11		265		106		150		10		266
Central⁽¹⁾	196		144		16		356		189		149		16		354
Southern⁽²⁾	46		153		14		213		52		144		13		209
Nordics⁽³⁾	29		20		1		50		29		21		1		51
Total Europe	624		675		65		1,364		610		690		62		1,362
Other	38		21		3		62		38		28		6		72
Total	$	1,836	$	1,521	$	436	$	3,793	$	1,851	$	1,570	$	439	$	3,860

_____________________________


(1)	Switzerland, Germany, Austria, Belgium and Holland.


(2)	Italy, Greece, Spain and Portugal.


(3)	Sweden, Norway, Denmark and Finland.

The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:



	March 31, 2018
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	14	$	3	$	1	$	18	$	591	$	609	$	11
Government and education	16		4		3		23		525		548		26
Graphic arts	12		1		—		13		299		312		5
Industrial	5		1		1		7		172		179		4
Healthcare	4		1		1		6		138		144		4
Other	6		1		1		8		194		202		3
Total United States	57		11		7		75		1,919		1,994		53
Canada	8		2		1		11		362		373		19
France	7		—		—		7		473		480		16
U.K./Ireland	1		1		—		2		263		265		—
Central⁽¹⁾	1		1		1		3		353		356		6
Southern⁽²⁾	4		1		1		6		207		213		8
Nordics⁽³⁾	1		—		—		1		49		50		—
Total Europe	14		3		2		19		1,345		1,364		30
Other	3		—		—		3		59		62		—
Total	$	82	$	16	$	10	$	108	$	3,685	$	3,793	$	102

	December 31, 2017
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	18	$	3	$	1	$	22	$	597	$	619	$	12
Government and education	18		3		3		24		533		557		21
Graphic arts	12		1		—		13		309		322		6
Industrial	6		1		1		8		172		180		4
Healthcare	5		1		1		7		138		145		5
Other	7		1		1		9		197		206		3
Total United States	66		10		7		83		1,946		2,029		51
Canada	8		2		1		11		386		397		17
France	6		—		—		6		476		482		22
U.K./Ireland	3		—		—		3		263		266		—
Central⁽¹⁾	1		2		—		3		351		354		6
Southern⁽²⁾	4		1		1		6		203		209		6
Nordics⁽³⁾	—		—		—		—		51		51		—
Total Europe	14		3		1		18		1,344		1,362		34
Other	3		—		—		3		69		72		—
Total	$	91	$	15	$	9	$	115	$	3,745	$	3,860	$	102

_____________________________

(1)Switzerland, Germany, Austria, Belgium and Holland.

(2)Italy, Greece, Spain and Portugal.

(3)Sweden, Norway, Denmark and Finland.

Equity Method Investments and Joint Ventures [Abstract]

Inventories

3 Months Ended

Mar. 31, 2018

Inventory Disclosure [Abstract]

Inventories

The following is a summary of Inventories by major category:



	March 31, 2018		December 31, 2017
Finished goods	$	857	$	777
Work-in-process	49		49
Raw materials	95		89
Total Inventories	$	1,001	$	915

Investment in Affiliates, at Equity

3 Months Ended

Mar. 31, 2018

Investment in Affiliates, at Equity

Our Equity in net (loss) income of unconsolidated affiliates was as follows:



	Three Months Ended March 31,
	2018			2017
Fuji Xerox	$	(70	)	$	37
Other	2			3
Total Equity in net (loss) income of unconsolidated affiliates	$	(68	)	$	40

Fuji Xerox

Equity in net (loss) income of Fuji Xerox is affected by certain adjustments required to reflect the deferral of profit associated with intercompany sales. These adjustments may result in recorded equity (loss) income that is different from that implied by our 25% ownership interest. In addition, the Equity in net loss of Fuji Xerox for the three months ended March 31, 2018 includes $79 of after-tax restructuring and other charges.

In 2018, in connection with the completion of the audits of Fuji Xerox’s fiscal year-end financial statements as of and for the years ended March 31, 2016 and 2017, as well the review of Fuji Xerox’s unaudited interim financial statements as of and for the nine months ended December 31, 2017 and 2016 additional adjustments and misstatements were identified. These additional adjustments and misstatements were to the previously reported net income of Fuji Xerox for the period from 2010 through 2017 and are incremental to the items identified by the IIC discussed in Note 2 - Correction of Fuji Xerox Misstatement in Prior Period Financial Statements. These incremental adjustments primarily relate to Fuji Xerox’s Asia Pacific subsidiaries and involve improper revenue recognition, including revenue associated with leasing transactions, additional provisions for bad debt allowances and other asset impairments. In certain instances, some of the adjustments related to inappropriate accounting and reporting practices in the Fuji Xerox Asia Pacific subsidiaries where previous misstatements were identified.

Fuji Xerox recorded a cumulative charge of JPY 12 billion (approximately $110 based on the Yen/U.S. Dollar average exchange rate for the quarter ended March 31, 2018 of 108.07) in their net loss for the quarter ended March 31, 2018 (our first quarter 2018) related to the correction of these additional adjustments and misstatements. Our recognition of 25% of Fuji Xerox’s net loss for Xerox’s first quarter 2018 included an approximately $28 charge related to these adjustments and misstatements. We determined that the impact of the out-of-period misstatements was not material to Xerox’s consolidated financial statements for any individual prior quarter or year and the adjustment to correct the misstatements is not expected to be material to our full year 2018 results.

The summarized financial information below for Fuji Xerox has likewise been revised accordingly to reflect the impact of the revision discussed in Note 2 - Correction of Fuji Xerox Misstatement in Prior Period Financial Statements:



	Three Months Ended March 31,
	2018			2017
Summary of Operations:
Revenues	$	2,465		$	2,559
Costs and expenses	2,771			2,352
(Loss) Income before Income Taxes	(306		)	207
Income tax (benefit) expense	(39		)	44
Net (Loss) Income	(267		)	163
Less: Net income attributable to noncontrolling interests	—			1
Net (Loss) Income – Fuji Xerox	$	(267	)	$	162
Weighted Average Exchange Rate⁽¹⁾	108.07			113.72

_____________________________


(1)	Represents Yen/U.S. Dollar exchange rate used to translate.

Restructuring Programs

3 Months Ended

Mar. 31, 2018

Restructuring and Related Activities [Abstract]

Restructuring Programs

During the three months ended March 31, 2018, we recorded net restructuring and asset impairment charges of $28, which included $24 of severance costs related to headcount reductions of approximately 400 employees worldwide and $12 of lease cancellation costs. These costs were partially offset by $8 of net reversals, primarily resulting from changes in estimated reserves from prior period initiatives. Costs related to professional support services associated with the implementation of the Strategic Transformation program were minimal.

Information related to restructuring program activity is outlined below:



	Severance and Related Costs			Lease Cancellation and Other Costs			Asset Impairments⁽²⁾		Total
Balance at December 31, 2017	$	108		$	1		$	—	$	109
Provision	24			12			—		36
Reversals	(8		)	—			—		(8		)
Net current period charges⁽¹⁾	16			12			—		28
Charges against reserve and currency	(41		)	(11		)	—		(52		)
Balance at March 31, 2018	$	83		$	2		$	—	$	85

____________________________


(1)	Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown for restructuring and asset impairments charges.


(2)	Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision.

The following table summarizes the reconciliation to the Condensed Consolidated Statements of Cash Flows:



	Three Months Ended March 31,
	2018			2017
Charges against reserve and currency	$	(52	)	$	(57	)
Effects of foreign currency and other non-cash items	(2		)	(1		)
Restructuring cash payments	$	(54	)	$	(58	)

Debt

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Debt

Bridge Facility

Refer to Note 20 - Fuji Xerox Transaction and Recent Developments for additional information regarding the bridge loan facility entered into in connection with the Fuji Xerox Transaction.

Interest Expense and Income

Interest expense and income were as follows:



	Three Months Ended March 31,
	2018		2017
Interest expense⁽¹⁾	$	65	$	69
Interest income⁽²⁾	74		78

____________


(1)	Includes Cost of financing as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income.


(2)	Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income.

Financial Instruments

3 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Instruments

Interest Rate Risk Management

We use interest rate swap agreements to manage our interest rate exposure and to achieve a desired proportion of variable and fixed rate debt. These derivatives may be designated as fair value hedges or cash flow hedges depending on the nature of the risk being hedged.

Fair Value Hedges

As of March 31, 2018, pay variable/receive fixed interest rate swaps with notional amounts of $300 and net liability fair value of $4 were designated and accounted for as fair value hedges. The swaps were structured to hedge the fair value of related debt by converting them from fixed rate instruments to variable rate instruments. No ineffective portion was recorded to earnings for the three months ended March 31, 2018.

The following is a summary of our fair value hedges at March 31, 2018:



Debt Instrument	Year First Designated	Notional Amount		Net Fair Value			Weighted Average Interest Rate Paid		Interest Rate Received		Basis	Maturity
Senior Note 2021	2014	$	300	$	(4	)	2.85	%	4.5	%	Libor	2021

Foreign Exchange Risk Management

We are a global company that is exposed to foreign currency exchange rate fluctuations in the normal course of our business. As a part of our foreign exchange risk management strategy, we use derivative instruments, primarily forward contracts and purchased option contracts, to hedge the following foreign currency exposures, thereby reducing volatility of earnings or protecting fair values of assets and liabilities:

•Foreign currency-denominated assets and liabilities


•	Forecasted purchases and sales in foreign currency

At March 31, 2018 and December 31, 2017, we had outstanding forward exchange and purchased option contracts with gross notional values of $1,557 and $1,788 respectively, with terms of less than 12 months. Approximately 70% of the contracts at March 31, 2018 mature within three months, 20% mature in three to six months and 10% in six to twelve months. The associated currency exposures being hedged at March 31, 2018 were materially consistent with our year-end currency exposures. There has not been any material change in our hedging strategy.

Foreign Currency Cash Flow Hedges

We designate a portion of our foreign currency derivative contracts as cash flow hedges of our foreign currency-denominated inventory purchases, sales and expenses. The net asset (liability) fair value of these contracts were $4 and $(14) as of March 31, 2018 and December 31, 2017, respectively.

Summary of Derivative Instruments Fair Value

The following table provides a summary of the fair value amounts of our derivative instruments:



Designation of Derivatives	Balance Sheet Location	March 31, 2018			December 31, 2017
Derivatives Designated as Hedging Instruments
Foreign exchange contracts - forwards	Other current assets	$	5		$	1
	Other current liabilities	(4		)	(15		)
Foreign currency options	Other current assets	3			—
Interest rate swaps	Other long-term assets	—			1
	Other long-term liabilities	(4		)	—
	Net designated derivative liability	$	—		$	(13	)

Derivatives NOT Designated as Hedging Instruments
Foreign exchange contracts – forwards	Other current assets	$	4		$	1
	Other current liabilities	(2		)	(10		)
	Net undesignated derivative asset (liability)	$	2		$	(9	)

Summary of Derivatives	Total Derivative Assets	$	12		$	3
	Total Derivative Liabilities	(10		)	(25		)
	Net Derivative asset (liability)	$	2		$	(22	)

Summary of Derivative Instruments Gains (Losses)

Derivative gains (losses) affect the income statement based on whether such derivatives are designated as hedges of underlying exposures. The following is a summary of derivative gains (losses).

Designated Derivative Instruments Gains (Losses)

The following table provides a summary of gains (losses) on derivative instruments:



	Three Months Ended March 31,
Gain (Loss) on Derivative Instruments	2018			2017
Fair Value Hedges - Interest Rate Contracts
Derivative loss recognized in interest expense	$	(5	)	$	(1	)
Hedged item gain recognized in interest expense	5			1

Cash Flow Hedges - Foreign Exchange Forward Contracts and Options
Derivative gain recognized in OCI (effective portion)	$	12		$	9
Derivative Loss reclassified from AOCL to income - Cost of sales (effective portion)	(12		)	(4		)

During the three months ended March 31, 2018 and 2017 no amount of ineffectiveness was recorded in the Condensed Consolidated Statements of Income for these designated cash flow hedges and all components of each derivative’s gain or (loss) were included in the assessment of hedge effectiveness. In addition, no amount was recorded for an underlying exposure that did not occur or was not expected to occur.

As of March 31, 2018, a net after-tax gain of $5 was recorded in Accumulated other comprehensive loss associated with our cash flow hedging activity. The entire balance is expected to be reclassified into net income within the next 12 months, providing an offsetting economic impact against the underlying anticipated transactions.

Non-Designated Derivative Instruments Gains (Losses)

Non-designated derivative instruments are primarily instruments used to hedge foreign currency-denominated assets and liabilities. They are not designated as hedges since there is a natural offset for the re-measurement of the underlying foreign currency-denominated asset or liability.

The following table provides a summary of gains on non-designated derivative instruments:



Derivatives NOT Designated as Hedging Instruments		Three Months Ended March 31,
Derivatives NOT Designated as Hedging Instruments	Location of Derivative Gain	2018		2017
Foreign exchange contracts – forwards	Other expense – Currency gain, net	$	—	$	4

For the three months ended March 31, 2018 and 2017, currency gains (losses), net were $2 and $(3), respectively. Net currency gains and losses include the mark-to-market adjustments of the derivatives not designated as hedging instruments and the related cost of those derivatives as well as the re-measurement of foreign currency-denominated assets and liabilities and are included in Other expenses, net.

Fair Value of Financial Assets and Liabilities

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value of Financial Assets and Liabilities

The following table represents assets and liabilities measured at fair value on a recurring basis. The basis for the measurement at fair value in all cases is Level 2 – Significant Other Observable Inputs.



	March 31, 2018		December 31, 2017
Assets:
Foreign exchange contracts - forwards	$	9	$	2
Foreign currency options	3		—
Interest rate swaps	—		1
Deferred compensation investments in mutual funds	18		18
Total	$	30	$	21
Liabilities:
Foreign exchange contracts - forwards	$	6	$	25
Interest rate swaps	4		—
Deferred compensation plan liabilities	18		19
Total	$	28	$	44

We utilize the income approach to measure the fair value for our derivative assets and liabilities. The income approach uses pricing models that rely on market observable inputs such as yield curves, currency exchange rates and forward prices, and therefore are classified as Level 2.

Fair value for our deferred compensation plan investments in mutual funds is based on quoted market prices for those funds. Fair value for deferred compensation plan liabilities is based on the fair value of investments corresponding to employees’ investment selections.

Summary of Other Financial Assets and Liabilities

The estimated fair values of our other financial assets and liabilities were as follows:



	March 31, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents	$	1,398	$	1,398	$	1,293	$	1,293
Accounts receivable, net	1,326		1,326		1,357		1,357
Short-term debt	678		679		282		283
Long-term debt	4,811		4,880		5,235		5,373

The fair value amounts for Cash and cash equivalents and Accounts receivable, net, approximate carrying amounts due to the short maturities of these instruments. The fair value of Short and Long-term debt was estimated based on the current rates offered to us for debt of similar maturities (Level 2). The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at such date.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Stockholders' Equity Note [Abstract]

Employee Benefit Plans

3 Months Ended

Mar. 31, 2018

Retirement Benefits [Abstract]

Employee Benefit Plans

The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows:



	Three Months Ended March 31,
	Pension Benefits
	U.S. Plans						Non-U.S. Plans						Retiree Health
Components of Net Periodic Benefit Costs:	2018			2017			2018			2017			2018			2017
Service cost	$	1		$	1		$	6		$	7		$	1		$	1
Interest cost	33			34			39			39			6			7
Expected return on plan assets	(34		)	(31		)	(63		)	(53		)	—			—
Recognized net actuarial loss	6			5			15			19			—			—
Amortization of prior service credit	—			—			(1		)	(1		)	(1		)	(1		)
Recognized settlement loss	25			42			—			—			—			—
Defined benefit plans	31			51			(4		)	11			6			7
Defined contribution plans	6			6			7			7			n/a			n/a
Net Periodic Benefit Cost	37			57			3			18			6			7

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Net actuarial (gain) loss⁽¹⁾	(58		)	8			—			—			—			—
Amortization of net actuarial loss	(31		)	(47		)	(15		)	(19		)	—			—
Amortization of prior service credit	—			—			1			1			1			1
Total Recognized in Other Comprehensive Income⁽²⁾	(89		)	(39		)	(14		)	(18		)	1			1
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income	$	(52	)	$	18		$	(11	)	$	—		$	7		$	8

__________


(1)	The net actuarial (gain) loss for U.S. Plans primarily reflects the re-measurement of our primary U.S. pension plans as a result of the payment of periodic settlements.


(2)	Amounts represent the pre-tax effect included within Other comprehensive Income. Refer to Note 17 - Other Comprehensive Income for related tax effects and the after-tax amounts.

Contributions

The following table summarizes cash contributions to our defined benefit pension plans and retiree health benefit plans.



	Three Months Ended March 31,				Year Ended December 31,
	2018		2017		Estimated 2018		2017
U.S. plans	$	8	$	6	$	76	$	675
Non-U.S. plans	30		17		116		161
Total Pension	$	38	$	23	$	192	$	836

Retiree Health	$	15	$	14	$	62	$	64

There are no contributions required in 2018 for our U.S. tax-qualified defined benefit plans to meet the minimum funding requirements, however, our estimated 2018 contributions include $50 of voluntary contributions to these plans.

Shareholders' Equity

3 Months Ended

Mar. 31, 2018

Shareholders' Equity

Shareholders’ Equity



	Common Stock		Additional Paid-in Capital		Retained Earnings			AOCL⁽⁴⁾			Xerox Shareholders’ Equity			Non-controlling Interests			Total Equity
Balance at December 31, 2017	$	255	$	3,893	$	4,856		$	(3,748	)	$	5,256		$	37		$	5,293
Cumulative effect of change in accounting principle⁽¹⁾	—		—		117			—			117			—			117
Comprehensive income, net	—		—		23			211			234			3			237
Cash dividends declared - common⁽²⁾	—		—		(65		)	—			(65		)	—			(65		)
Cash dividends declared - preferred⁽³⁾	—		—		(4		)	—			(4		)	—			(4		)
Stock option and incentive plans, net	—		15		—			—			15			—			15
Distributions to noncontrolling interests	—		—		—			—			—			(11		)	(11		)
Balance at March 31, 2018	$	255	$	3,908	$	4,927		$	(3,537	)	$	5,553		$	29		$	5,582



	Common Stock		Additional Paid-in Capital		Retained Earnings			AOCL⁽⁴⁾			Xerox Shareholders’ Equity			Non- controlling Interests			Total Equity
Balance at December 31, 2016	$	254	$	3,858	$	4,934		$	(4,337	)	$	4,709		$	38		$	4,747
Comprehensive income, net	—		—		40			166			206			3			209
Cash dividends declared - common⁽²⁾	—		—		(64		)	—			(64		)	—			(64		)
Cash dividends declared - preferred⁽³⁾	—		—		(4		)	—			(4		)	—			(4		)
Stock option and incentive plans, net	—		6		—			—			6			—			6
Distributions to noncontrolling interests	—		—		—			—			—			(1		)	(1		)
Balance at March 31, 2017	$	254	$	3,864	$	4,906		$	(4,171	)	$	4,853		$	40		$	4,893

_____________________________

(1)Refer to Note 3 - Adoption of New Revenue Recognition Standard for additional information.

(2)Cash dividends declared on common stock of $0.25 per share in the first quarter of 2018 and 2017.

(3)Cash dividends declared on preferred stock of $20.00 per share in the first quarter of 2018 and 2017.

(4)Refer to Note 17 - Other Comprehensive Income for components of AOCL.

Treasury Stock

There were no repurchases of Xerox Common Stock pursuant to Board authorized share repurchase programs during the first quarter 2018.

Other Comprehensive Income

3 Months Ended

Mar. 31, 2018

Other Comprehensive Income (Loss) [Abstract]

Other Comprehensive Income

Other Comprehensive Income is comprised of the following:



	Three Months Ended March 31,
	2018						2017
	Pre-tax			Net of Tax			Pre-tax			Net of Tax
Translation Adjustments Gains	$	184		$	176		$	134		$	133
Unrealized Gains (Losses):
Changes in fair value of cash flow hedges - gains	12			8			9			6
Changes in cash flow hedges reclassed to earnings⁽¹⁾	12			10			4			2
Other losses	(1		)	(1		)	—			—
Net unrealized gains	23			17			13			8

Defined Benefit Plans Gains (Losses):
Net actuarial/prior service gains (losses)	58			43			(8		)	(5		)
Prior service amortization⁽²⁾	(2		)	(1		)	(2		)	(1		)
Actuarial loss amortization/settlement⁽²⁾	46			35			66			44
Fuji Xerox changes in defined benefit plans, net⁽³⁾	(21		)	(21		)	13			13
Other losses⁽⁴⁾	(38		)	(38		)	(25		)	(25		)
Changes in defined benefit plans gains	43			18			44			26

Other Comprehensive Income	250			211			191			167
Less: Other comprehensive income attributable to noncontrolling interests	—			—			1			1
Other Comprehensive Income Attributable to Xerox	$	250		$	211		$	190		$	166

_____________________________


(1)	Reclassified to Cost of sales - refer to Note 13 - Financial Instruments for additional information regarding our cash flow hedges.


(2)	Reclassified to Total Net Periodic Benefit Cost - refer to Note 15 - Employee Benefit Plans for additional information.


(3)	Represents our share of Fuji Xerox's benefit plan changes.


(4)	Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL.

Accumulated Other Comprehensive Loss (AOCL)

AOCL is comprised of the following:



	March 31, 2018			December 31, 2017
Cumulative translation adjustments	$	(1,605	)	$	(1,781	)
Other unrealized gains (losses), net	5			(12		)
Benefit plans net actuarial losses and prior service credits⁽¹⁾	(1,937		)	(1,955		)
Total Accumulated other comprehensive loss attributable to Xerox	$	(3,537	)	$	(3,748	)

_____________________________


(1)	Includes our share of Fuji Xerox.

Earnings per Share

3 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share of common stock (shares in thousands):



	Three Months Ended March 31,
	2018			2017
Basic Earnings (Loss) per Share:
Net Income from Continuing Operations Attributable to Xerox	$	23		$	46
Accrued dividends on preferred stock	(4		)	(4		)
Adjusted Net income from continuing operations available to common shareholders	19			42
Net loss from discontinued operations attributable to Xerox	—			(6		)
Adjusted Net income available to common shareholders	$	19		$	36

Weighted average common shares outstanding	254,660			254,038
Basic Earnings (Loss) per Share:
Continuing operations	$	0.08		$	0.17
Discontinued operations	—			(0.03		)
Basic Earnings per Share	$	0.08		$	0.14

Diluted Earnings (Loss) per Share:
Net Income from Continuing Operations Attributable to Xerox	$	23		$	46
Accrued dividends on preferred stock	(4		)	(4		)
Adjusted Net income from continuing operations available to common shareholders	19			42
Net loss from discontinued operations attributable to Xerox	—			(6		)
Adjusted Net income available to common shareholders	$	19		$	36

Weighted average common shares outstanding	254,660			254,038
Common shares issuable with respect to:
Restricted stock and performance shares	2,810			2,104
Adjusted Weighted average common shares outstanding	257,470			256,142
Diluted Earnings (Loss) per Share:
Continuing operations	$	0.08		$	0.16
Discontinued operations	—			(0.02		)
Diluted Earnings per Share	$	0.08		$	0.14

The following securities were not included in the computation of diluted earnings per share as they were either contingently issuable shares or shares that if included would have been anti-dilutive:
Stock options	—			—
Restricted stock and performance shares	2,977			3,937
Convertible preferred stock	6,742			6,742
Total Anti-Dilutive Securities	9,719			10,679

Dividends per Common Share	$	0.25		$	0.25

Contingencies and Litigation	3 Months Ended
Contingencies and Litigation	Mar. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Contingencies and Litigation	Contingencies and Litigation Legal Matters We are involved in a variety of claims, lawsuits, investigations and proceedings concerning: securities law; governmental entity contracting; servicing and procurement law; intellectual property law; environmental law; employment law; the Employee Retirement Income Security Act (ERISA); and other laws and regulations. We determine whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. We assess our potential liability by analyzing our litigation and regulatory matters using available information. We develop our views on estimated losses in consultation with outside counsel handling our defense in these matters, which involves an analysis of potential results, assuming a combination of litigation and settlement strategies. Should developments in any of these matters cause a change in our determination as to an unfavorable outcome and result in the need to recognize a material accrual, or should any of these matters result in a final adverse judgment or be settled for significant amounts, they could have a material adverse effect on our results of operations, cash flows and financial position in the period or periods in which such change in determination, judgment or settlement occurs. Brazil Tax and Labor Contingencies Our Brazilian operations are involved in various litigation matters and have received or been the subject of numerous governmental assessments related to indirect and other taxes, as well as disputes associated with former employees and contract labor. The tax matters, which comprise a significant portion of the total contingencies, principally relate to claims for taxes on the internal transfer of inventory, municipal service taxes on rentals and gross revenue taxes. We are disputing these tax matters and intend to vigorously defend our positions. Based on the opinion of legal counsel and current reserves for those matters deemed probable of loss, we do not believe that the ultimate resolution of these matters will materially impact our results of operations, financial position or cash flows. The labor matters principally relate to claims made by former employees and contract labor for the equivalent payment of all social security and other related labor benefits, as well as consequential tax claims, as if they were regular employees. As of March 31, 2018, the total amounts related to the unreserved portion of the tax and labor contingencies, inclusive of any related interest, amounted to approximately $585, with the decrease from our December 31, 2017 balance of approximately $600, primarily related to closed cases, partially offset by interest. With respect to the unreserved balance of $585, the majority has been assessed by management as being remote as to the likelihood of ultimately resulting in a loss to the company. In connection with the above proceedings, customary local regulations may require us to make escrow cash deposits or post other security of up to half of the total amount in dispute. As of March 31, 2018, we had $72 of escrow cash deposits for matters we are disputing and additional letters of credit and surety bonds of approximately $131 and $107, respectively, which include associated indexation. There were no liens on any of our Brazilian assets as of March 31, 2018. Generally, any escrowed amounts would be refundable and any liens would be removed to the extent the matters are resolved in our favor. We routinely assess all these matters as to the probability of ultimately incurring a liability against our Brazilian operations and record our best estimate of the ultimate loss in situations where we assess the likelihood of an ultimate loss as probable. Litigation Against the Company Pending LItigation Relating to the Fuji Transaction: In February 2018, five complaints, including four putative class actions (which have been consolidated), were filed by Xerox shareholders in the Supreme Court of the State of New York, County ("Court") in connection with the proposed transaction to combine Xerox and Fuji Xerox (“Fuji Transaction”) (refer to Note 20 - Fuji Xerox Transaction and Recent Developments). All of the complaints name as defendants Xerox, its directors, and FUJIFILM Holdings Corporation (“Fujifilm”). The complaint in one of the actions also names as a defendant Ursula M. Burns, the former Chief Executive Officer of Xerox. The plaintiffs allege, among other things, that Xerox's directors breached their fiduciary duties in negotiating, approving, and purportedly making false and misleading disclosures about the Fuji Transaction, and that Fujifilm aided and abetted those breaches. The complaint in one of the actions further alleges that Xerox and the director defendants engaged in common law fraud by purportedly failing to disclose information about the joint venture agreements between Xerox and Fujifilm. The lawsuits seek injunctive relief preventing the proposed transactions, and/or additional disclosures by Xerox’s directors, unspecified damages from Xerox’s directors, costs and attorneys’ fees, as well as other relief. Another complaint filed by Darwin Deason, a Xerox shareholder, against Xerox and its directors in the same Court on March 2, 2018 alleges that defendants breached their fiduciary duties by refusing Mr. Deason’s request for a waiver of the deadline for nomination of a new slate of Xerox directors, and seeks to enjoin Xerox and its directors from enforcing Xerox’s advance notice by-laws, thereby allowing Mr. Deason to proceed with the nominations, as well as costs, fees, and other relief. On April 27, 2018, the Court issued decisions and orders granting plaintiffs’ preliminary injunction motions, which (i) enjoin Xerox from “taking any further action to consummate the change of control transaction between Xerox and Fuji that was announced on January 31, 2018 pending a final determination of the claims asserted in the underlying action;” (ii) enjoin Xerox from enforcing its advance notice bylaw provision requiring shareholders to nominate directors for election at the 2018 annual shareholder meeting by December 11, 2017; and (iii) require Xerox to waive such advance notice bylaw provision to permit the noticing of a slate of director nominees for election at the 2018 annual shareholder meeting, and denying defendants’ motions to dismiss. On May 1, 2018, Xerox entered into a Director Appointment, Nomination and Settlement Agreement (the “Settlement Agreement”) with Carl Icahn and Darwin Deason, among others, that would have resolved the pending proxy contest in connection with Xerox’s 2018 Annual Meeting of Shareholders, as well as the ongoing litigation brought by Mr. Deason against Xerox and its directors related to the proposed Fuji Transaction. The agreement expired by its terms on May 3, 2018 without becoming effective. On May 7, 2018, defendants filed with the Supreme Court of the State of New York, Appellate Division, First Judicial Department, notices of appeal of, and motions to stay pending appeal, the lower Court’s decision and order. Defendants also moved the appellate court for interim relief ordering that the appeal be heard on an expedited basis. At a hearing before the appellate court on May 7, 2018, the appellate court ruled that the appeals would be heard on an expedited basis and granted a partial interim stay allowing Xerox and Fujifilm to take steps to seek regulatory approvals related to the Fuji Transaction pending a ruling from the appellate court on defendants’ motions to stay pending appeal. Xerox believes the lawsuits are meritless and will vigorously defend them. At this time, however, it is premature to make any conclusion regarding the probability of incurring material losses in these litigations. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs, including an inability to close the proposed transactions. State of Texas v. Xerox Corporation, Xerox State Healthcare, LLC, and ACS State Healthcare, LLC: On May 9, 2014, the State of Texas, via the Texas Office of Attorney General (the “State”), filed a lawsuit in the 53rd Judicial District Court of Travis County, Texas. The lawsuit alleges that Xerox Corporation, Xerox State Healthcare, LLC and ACS State Healthcare (collectively “the Defendants”) violated the Texas Medicaid Fraud Prevention Act in the administration of ACS’s contract with the Texas Department of Health and Human Services (“HHSC”). Xerox Corporation provided a guaranty of contractual performance with respect to the ACS contract. The State alleges that the Defendants made false representations of material facts regarding the processes, procedures, implementation and results regarding the prior authorization of orthodontic claims. The State seeks recovery of actual damages, two times the amount of any overpayments made as a result of unlawful acts, civil penalties, pre- and post-judgment interest and all costs and attorneys’ fees. The State references the amount in controversy as exceeding hundreds of millions of dollars. The Defendants filed their Answer in June 2014 denying all allegations. In August 2017, the State of Texas filed a Second Amended Petition, which makes substantially similar allegations and seeks similar remedies as the original lawsuit. On October 23, 2017, Xerox Corporation filed a Motion for Summary Judgment seeking judgment in Xerox's favor on all claims against it. The Defendants will continue to vigorously defend themselves in this matter. This matter is a “Conduent Liability”, as defined in the Separation and Distribution Agreement dated as of December 31, 2016 between Xerox Corporation and Conduent Incorporated, for which Conduent is required to indemnify Xerox. Conduent is entitled to direct the defense of this matter. Oklahoma Firefighters Pension and Retirement System v. Xerox Corporation, Ursula M. Burns, Luca Maestri, Kathryn A. Mikells, Lynn R. Blodgett, Robert K. Zapfel, David H. Bywater and Mary Scanlon: On October 21, 2016, the Oklahoma Firefighters Pension and Retirement System (“plaintiff”) filed a purported securities class action complaint against Xerox Corporation, Ursula Burns, Luca Maestri, Kathryn Mikells, Lynn Blodgett and Robert Zapfel (collectively, “defendants”) in the U.S. District Court for the Southern District of New York on behalf of the plaintiff and certain purchasers or acquirers of Xerox common stock. The complaint alleged that defendants made false and misleading statements, in violation of Sections 10(b) and 20(a) of the Securities Exchange Act and SEC Rule 10b-5, relating to the operations and prospects of Xerox’s Health Enterprise business. Plaintiff sought, among other things, unspecified monetary damages and attorneys’ fees. Other, similar lawsuits may follow. On December 28, 2016, the Court entered a stipulated order setting out a schedule for amendment of the complaint and for defendants’ response to that complaint following the Court’s appointment of lead plaintiff under the Private Securities Litigation Reform Act. On February 28, 2017, the Court issued an opinion and order appointing the Arkansas Public Employees Retirement System ("APERS") as lead plaintiff. On May 1, 2017, APERS filed an amended complaint, alleging substantially similar claims and seeking substantially similar relief, but adding David Bywater and Mary Scanlon as defendants. On June 30, 2017, defendants moved to dismiss the amended complaint, and the motions were fully briefed on October 13, 2017. On March 20, 2018, the Court entered an opinion and order granting the motions, and on March 23, 2018, the Court entered a judgment of dismissal and closed the case. On April 20, 2018, plaintiffs filed a notice of appeal in the U.S. Court of Appeals for the Second Circuit. Xerox will vigorously defend against this matter. At this time, it is premature to make any conclusion regarding the probability of incurring material losses in this litigation. Should developments cause a change in our determination as to an unfavorable outcome, or result in a final adverse judgment or settlement, there could be a material adverse effect on our results of operations, cash flows and financial position in the period in which such change in determination, judgment, or settlement occurs. Other Contingencies We have issued or provided approximately $366 of guarantees as of March 31, 2018 in the form of letters of credit or surety bonds issued to i) support certain insurance programs; ii) support our obligations related to the Brazil tax and labor contingencies; and iii) support certain contracts, primarily with public sector customers, which require us to provide a surety bond as a guarantee of our performance of contractual obligations. In general, we would only be liable for the amount of these guarantees in the event we defaulted in performing our obligations under each contract; the probability of which we believe is remote. We believe that our capacity in the surety markets as well as under various credit arrangements (including our Credit Facility) is sufficient to allow us to respond to future requests for proposals that require such credit support. Indemnifications We have indemnified, subject to certain deductibles and limits, the purchasers of businesses or divested assets for the occurrence of specified events under certain of our divestiture agreements. Where appropriate, an obligation for such indemnifications is recorded as a liability. Since the obligated amounts of these types of indemnifications are often not explicitly stated and/or are contingent on the occurrence of future events, the overall maximum amount of the obligation under such indemnifications cannot be reasonably estimated. Other than obligations recorded as liabilities at the time of divestiture, we have not historically made significant payments for these indemnifications. Additionally, under certain of our acquisition agreements, we have provided for additional consideration to be paid to the sellers if established financial targets are achieved post-closing. We have recognized liabilities for these contingent obligations based on an estimate of the fair value of these contingencies at the time of acquisition. Contingent obligations related to indemnifications arising from our divestitures and contingent consideration provided for by our acquisitions are not expected to be material to our financial position, results of operations or cash flows.

Fuji Xerox Transaction and Recent Developments

3 Months Ended

Mar. 31, 2018

Fuji Xerox Transaction and Recent Developments [Abstract]

Fuji Xerox Transaction and Recent Developments

Pending Litigation Relating to the Fuji Transaction

Refer to Note 19 - Contingencies and Litigation for discussion of the Pending Litigation Relating to the Fuji Transaction.

Fuji Xerox Transaction Overview

On January 31, 2018, Xerox entered into (i) a Redemption Agreement with FUJIFILM Holdings Corporation, a Japanese company (“Fujifilm”), and Fuji Xerox Co., Ltd., a Japanese company, in which Xerox indirectly holds a 25% equity interest while Fujifilm holds the remaining 75% equity interest (“Fuji Xerox”), and (ii) a Subscription Agreement with Fujifilm (collectively, the “Transaction Agreements”). The Transaction Agreements provide that, on the terms and subject to the conditions set forth in the Transaction Agreements, among other things:

•

Redemption and Issuance - Fuji Xerox will redeem most of the shares of Fuji Xerox owned by Fujifilm in exchange for cash. Immediately following the Redemption, Fujifilm will contribute to Xerox the cash it received in the Redemption and all shares of Fuji Xerox still held by Fujifilm after giving effect to the Redemption and, in exchange therefore, Xerox will issue to Fujifilm a number of shares of Xerox common stock such that Fujifilm will own 50.1% of the Xerox common stock, on a fully diluted basis, at the closing of the transactions (the “Closing”), a portion of which will be held in escrow in accordance with the terms of the Transaction Agreements. As a result of the transactions contemplated by the Transaction Agreements (referred to herein as the "combination"), Fuji Xerox will become a wholly owned subsidiary of Xerox and Xerox will become a direct, majority owned subsidiary of Fujifilm (with the remainder of Xerox continuing to be owned by Xerox’s existing shareholders). The escrowed shares will be released from escrow upon, among other things, (i) the conversion of any shares of Xerox Series B Convertible Perpetual Preferred Stock into Xerox common stock or (ii) the issuance of any Xerox common stock in respect of any performance shares, options that were not in-the-money options or restricted stock units that remain unvested as of two business days prior to the Closing. If the events that could give rise to a release of the escrow shares to Fujifilm can no longer reasonably be expected to occur, then the escrow shares will be transferred back to the combined company (“new Fuji Xerox”) and thereafter cancelled. Prior to their release, Fujifilm, as the holder of the escrow shares, will be required to vote such shares in the same proportion as all of the outstanding shares of Xerox common stock that are not escrowed shares are voted (for or against, not voted, or abstained as the case may be) and to return to new Fuji Xerox any distributions of dividends received in respect thereof.

•

Special Dividend - In connection with the combination, subject to applicable law, Xerox will declare a special one-time cash dividend of $2.5 billion, in the aggregate, to the holders of record of Xerox common stock on the record date for the special dividend. The amount of the special dividend is currently estimated to be approximately $9.80 per share of Xerox common stock (based on the shares of Xerox common stock outstanding as of March 31, 2018). The special dividend will be paid immediately prior to the Closing and funded by a new borrowing. Fujifilm will not be a shareholder of Xerox as of the record date for the special dividend and therefore will not receive any payment in respect thereof.

As previously announced, the Company and Fujifilm have been in discussions about improving the terms of their announced transaction. In connection with such discussions, the Company has had correspondence with Fujifilm as to whether Xerox has the right to terminate the Subscription Agreement.

Fuji Xerox has been determined to be the accounting acquirer and Xerox to be the accounting acquiree under the acquisition method of accounting based on various considerations. As noted above, immediately following the Closing, Fujifilm, the former parent of Fuji Xerox, is expected to own approximately 50.1% of the fully diluted capital stock of new Fuji Xerox and the other Xerox shareholders are expected to own approximately 49.9%. Further, pursuant to the Shareholders Agreement, to be entered into by Xerox and Fujifilm at Closing (the “Shareholders Agreement”), the board of directors of new Fuji Xerox will have twelve directors, which will initially be composed of seven individuals designated by Fujifilm (including the current CEO of Xerox) and five individuals from among the members of the board of directors of Xerox immediately prior to Closing designated by Xerox in consultation with and subject to reasonable approval by Fujifilm. Accordingly, the combination is expected to be accounted for as a reverse acquisition as per ASC Topic 805-40 "Business Combinations - Reverse Acquisitions".

Under certain circumstances, including the following, Xerox must pay to Fujifilm a $183 termination fee (the “Termination Fee”): in the event that the Subscription Agreement is terminated (i) by either party because the applicable shareholder approvals are not obtained if an alternative acquisition proposal is publicly announced prior to the Xerox shareholder meeting duly called for the purpose of obtaining the applicable shareholder approvals and Xerox enters into a definitive agreement with respect to, or otherwise consummates, an alternative acquisition proposal within 12 months after the termination of the Subscription Agreement; (ii) by Fujifilm (A) in connection with a material and intentional breach by Xerox of its non-solicitation obligations resulting in a third party making an alternate acquisition proposal that is reasonably likely to materially interfere with the Fujifilm Transactions or (B) following a change in the recommendation by the Board of Directors of Xerox; or (iii) by Xerox in order to enter into a definitive agreement with a third party with respect to a superior proposal, in each case as set forth in, and subject to the conditions of, the Fujifilm Transaction Agreements.

The completion of the Fujifilm Transactions will require Xerox shareholder approval as well as customary regulatory approvals, filings with the U.S. Securities and Exchange Commission, tax considerations, and securing any necessary financing. Until the combination is complete, each of Xerox, Fuji Xerox and Fujifilm will continue to be separate, independent organizations and will operate as usual.

Bridge Facility

On January 31, 2018, Xerox entered into a Commitment Letter with Citigroup Global Markets Inc. and Morgan Stanley Senior Funding, Inc., which provides a commitment, subject to the satisfaction of customary conditions, for a $2.5 billion unsecured bridge loan facility. This facility would be available for Xerox to pay the special one-time cash dividend of $2.5 billion to existing shareholders of Xerox as described herein. Xerox has not borrowed funds nor does it currently plan to borrow funds from this facility, rather, prior to closing, Xerox intends to secure alternative financing to meet its obligation to pay the special dividend. At March 31, 2018, we had approximately $11 of debt issuance costs deferred in connection with this facility, which are currently being amortized over the remainder of the year, and another $6 was paid in the second quarter 2018, which will also be deferred and amortized. Xerox may also secure financing to fund approximately $350 required to settle certain of Xerox's obligations in respect of unfunded supplemental pension plans and deferred compensation plans which will accelerate in connection with the combination (such accelerated payments, the "change-in-control payments").

Cash, Cash Equivalents and Restricted Cash Cash, Cash Equivalents and Restricted Cash (Policies)	3 Months Ended
	Mar. 31, 2018
Cash, Cash Equivalents and Restricted Cash [Abstract]
Restricted Cash, Policy [Policy Text Block]	Restricted Cash Restricted cash primarily relates to escrow cash deposits made in Brazil associated with tax and labor litigation. As more fully discussed in Note 19 - Contingencies and Litigation, various litigation matters in Brazil require us to make cash deposits to escrow as a condition of continuing the litigation. Restricted cash amounts are classified in our Condensed Consolidated Balance Sheets based on when the cash is expected to be contractually or judicially released.

Correction of Fuji Xerox Misstatement in Prior Period Financial Statements(Tables)

3 Months Ended

Mar. 31, 2018

Impact of Revisions [Table Text Block]

Revised Condensed Consolidated Statements of Income

The following tables reconcile selected lines from the company’s first quarter of 2017 Condensed Consolidated Statements of Income from the previously reported amounts to the revised amounts:



	Three Months Ended March 31, 2017
	As Reported		Adjustment		As Revised
Equity in net income of unconsolidated affiliates	$	16	$	24	$	40
Income from Continuing Operations	24		24		48
Net Income	18		24		42
Net Income Attributable to Xerox	16		24		40

Net income from continuing operations attributable to Xerox	$	22	$	24	$	46

Basic Earnings per Share:
Continuing operations	$	0.07	$	0.10	$	0.17
Total	$	0.05	$	0.09	$	0.14

Diluted Earnings per Share:
Continuing operations	$	0.07	$	0.09	$	0.16
Total	$	0.05	$	0.09	$	0.14

Revised Condensed Consolidated Statements of Comprehensive Income



	Three Months Ended March 31, 2017
	As Reported		Adjustment			As Revised
Net Income	$	18	$	24		$	42
Net Income Attributable to Xerox	16		24			40

Translation adjustments, net	$	136	$	(3	)	$	133
Other Comprehensive Income, Net	170		(3		)	167
Other Comprehensive Income, Net Attributable to Xerox	169		(3		)	166

Comprehensive Income, Net	$	188	$	21		$	209
Comprehensive Income, Net Attributable to Xerox	185		21			206

Revised Condensed Consolidated Statements of Cash Flows from Operations



	Three Months Ended March 31, 2017
	As Reported			Adjustment			As Revised
Cash Flows from Operating Activities:
Net Income	$	18		$	24		$	42
Income from Continuing Operations	24			24			48

Undistributed equity in net income of unconsolidated affiliates	$	(16	)	$	(24	)	$	(40	)

Adoption of New Revenue Recognition Standard (Tables)

3 Months Ended

Mar. 31, 2018

Revenue from Contract with Customer [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block]

The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:



	As of March 31, 2018
	Superseded Revenue Guidance⁽¹⁾		Adjustments			As Reported
Deferred tax assets	$	976	$	(34	)	$	942
Other long-term assets	764		147			911
Retained earnings	4,814		113			4,927

____________


(1)	Reflects balance of account under revenue recognition guidance superseded by ASC Topic 606.

The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:



	Three Months Ended March 31, 2017
(in millions)	As Reported		Adjustment			As Recasted
Cost of sales	$	567	$	(2	)	$	565
Costs of services, maintenance and rentals	900		(19		)	881
Research, development and engineering expenses	118		(7		)	111
Selling, administrative and general expenses	664		(30		)	634
Restructuring and related costs	120		(2		)	118
Other expenses, net	54		60			114

Disaggregation of Revenue [Table Text Block]

Revenues disaggregated by primary geographic markets, major product lines, and sales channels are as follows:



	Three Months Ended March 31,
	2018		2017
Primary geographical markets⁽¹⁾:
United States	$	1,414	$	1,469
Europe	676		640
Canada	144		145
Other	201		200
Total Revenues	$	2,435	$	2,454

Major product and services lines:
Equipment⁽²⁾	$	499	$	502
Supplies, paper and other sales	434		434
Maintenance agreements⁽³⁾	631		640
Service arrangements⁽⁴⁾	623		622
Rental and other	177		180
Financing	71		76
Total Revenues	$	2,435	$	2,454

Sales channels:
Direct equipment lease⁽⁵⁾	$	160	$	160
Distributors & resellers⁽⁶⁾	331		321
Customer direct	442		455
Total Sales	$	933	$	936

_____________


(1)	Geographic area data is based upon the location of the subsidiary reporting the revenue.


(2)	2017 Equipment sale revenues exclude $11 of equipment-related training revenue, which was classified as Services under previous revenue guidance - see "Adoption Summary" above.


(3)	Includes revenues from maintenance agreements on sold equipment as well as revenues associated with service agreements sold in our small and mid-sized business (SMB) focused channels and through our channel partners as Xerox Partner Print Services (XPPS).


(4)	Primarily includes revenues from our Managed Document Services (MDS) offerings. Also includes revenues from embedded operating leases, which were not significant.


(5)	Primarily reflects direct sales through bundled lease arrangements.


(6)	Primarily reflects sales through our two-tier distribution channels.

Recent Accounting Pronouncements Recent Accounting Pronouncements (Tables)

3 Months Ended

Mar. 31, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block]

The impacts of adopting ASC Topic 606 on our Condensed Consolidated Balance Sheets were as follows:



	As of March 31, 2018
	Superseded Revenue Guidance⁽¹⁾		Adjustments			As Reported
Deferred tax assets	$	976	$	(34	)	$	942
Other long-term assets	764		147			911
Retained earnings	4,814		113			4,927

____________


(1)	Reflects balance of account under revenue recognition guidance superseded by ASC Topic 606.

The following table reflects the adjustment of selected lines from our Condensed Consolidated Statements of Income to the recasted amounts as a result of the adoption of this update:



	Three Months Ended March 31, 2017
(in millions)	As Reported		Adjustment			As Recasted
Cost of sales	$	567	$	(2	)	$	565
Costs of services, maintenance and rentals	900		(19		)	881
Research, development and engineering expenses	118		(7		)	111
Selling, administrative and general expenses	664		(30		)	634
Restructuring and related costs	120		(2		)	118
Other expenses, net	54		60			114

Divestitures (Tables)

3 Months Ended

Mar. 31, 2018

Discontinued Operations and Disposal Groups [Abstract]

Summarized Financial Information - Discontinued Operations

Summarized financial information for our Discontinued Operations is as follows:



	Three Months Ended March 31,
	2018		2017
Loss from operations	$	—	$	8
Loss on disposal	—		—
Net loss before income taxes	—		(8		)
Income tax benefit	—		2
Loss from discontinued operations, net of tax	$	—	$	(6	)

Cash, Cash Equivalents and Restricted Cash [Abstract]

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Topic 205
-SubTopic 20
-Section 50
-Paragraph 5A
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721671-107760

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 5D
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721677-107760

+ Details

Cash, Cash Equivalents and Restricted Cash (Tables)

3 Months Ended

Mar. 31, 2018

Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash amounts were as follows:



	March 31, 2018		December 31, 2017
Cash and cash equivalents	$	1,398	$	1,293
Restricted cash
Tax and labor litigation deposits in Brazil	72		72
Other restricted cash	4		3
Total Restricted cash	76		75
Cash, cash equivalents and restricted cash	$	1,474	$	1,368

Restricted Cash - Balance Sheet Location

Restricted cash was reported in the Condensed Consolidated Balance Sheet as follows:



	March 31, 2018		December 31, 2017
Other current assets	$	2	$	1
Other long-term assets	74		74
Total Restricted cash	$	76	$	75

Accounts Receivable, Net (Tables)

3 Months Ended

Mar. 31, 2018

Receivables [Abstract]

Schedule of accounts receivable, net

Accounts receivable, net were as follows:



	March 31, 2018			December 31, 2017
Invoiced	$	1,033		$	1,048
Accrued	352			368
Allowance for doubtful accounts	(59		)	(59		)
Accounts receivable, net	$	1,326		$	1,357

Schedule of accounts receivables sales

Accounts receivable sales were as follows:



	Three Months Ended March 31,
	2018			2017
Accounts receivable sales⁽¹⁾	$	103		$	511
Deferred proceeds	—			52
Loss on sales of accounts receivable	1			3
Estimated decrease to operating cash flows⁽²⁾	(50		)	(65		)

__________________________

(1)


(2)	Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency.

Finance Receivables, Net (Tables)

3 Months Ended

Mar. 31, 2018

Financing Receivable, Net [Abstract]

Allowance for Credit Losses on Financing Receivables

The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:



Allowance for Credit Losses:	United States			Canada			Europe			Other⁽¹⁾		Total
Balance at December 31, 2017	$	56		$	15		$	35		$	2	$	108
Provision	5			—			4			—		9
Charge-offs	(5		)	(1		)	(4		)	—		(10		)
Recoveries and other⁽²⁾	—			—			1			—		1
Balance at March 31, 2018	$	56		$	14		$	36		$	2	$	108
Finance receivables as of March 31, 2018 collectively evaluated for impairment ⁽³⁾	$	1,994		$	373		$	1,364		$	62	$	3,793

Balance at December 31, 2016	$	55		$	16		$	37		$	2	$	110
Provision	4			—			5			—		9
Charge-offs	(6		)	(2		)	(2		)	—		(10		)
Recoveries and other⁽²⁾	—			2			—			—		2
Balance at March 31, 2017	$	53		$	16		$	40		$	2	$	111
Finance receivables as of March 31, 2017 collectively evaluated for impairment⁽³⁾	$	2,108		$	382		$	1,276		$	51	$	3,817

__________________


(1)	Includes developing market countries and smaller units.


(2)	Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations.


(3)	Total Finance receivables exclude the allowance for credit losses of $108 and $111 at March 31, 2018 and 2017, respectively.

Financing Receivable Credit Quality Indicators

Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:



	March 31, 2018								December 31, 2017
	Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables		Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables
Finance and other services	$	193	$	334	$	82	$	609	$	199	$	345	$	75	$	619
Government and education	480		62		6		548		490		61		6		557
Graphic arts	86		93		133		312		84		97		141		322
Industrial	80		84		15		179		82		84		14		180
Healthcare	90		46		8		144		88		48		9		145
Other	66		95		41		202		68		98		40		206
Total United States	995		714		285		1,994		1,011		733		285		2,029
Finance and other services	52		39		26		117		54		42		27		123
Government and education	44		5		4		53		48		5		5		58
Graphic arts	30		33		27		90		34		35		27		96
Industrial	19		11		11		41		20		12		11		43
Other	34		23		15		72		36		25		16		77
Total Canada	179		111		83		373		192		119		86		397
France	244		213		23		480		234		226		22		482
U.K./Ireland	109		145		11		265		106		150		10		266
Central⁽¹⁾	196		144		16		356		189		149		16		354
Southern⁽²⁾	46		153		14		213		52		144		13		209
Nordics⁽³⁾	29		20		1		50		29		21		1		51
Total Europe	624		675		65		1,364		610		690		62		1,362
Other	38		21		3		62		38		28		6		72
Total	$	1,836	$	1,521	$	436	$	3,793	$	1,851	$	1,570	$	439	$	3,860

_____________________________


(1)	Switzerland, Germany, Austria, Belgium and Holland.


(2)	Italy, Greece, Spain and Portugal.


(3)	Sweden, Norway, Denmark and Finland.

Finance Receivables Aging

The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:



	March 31, 2018
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	14	$	3	$	1	$	18	$	591	$	609	$	11
Government and education	16		4		3		23		525		548		26
Graphic arts	12		1		—		13		299		312		5
Industrial	5		1		1		7		172		179		4
Healthcare	4		1		1		6		138		144		4
Other	6		1		1		8		194		202		3
Total United States	57		11		7		75		1,919		1,994		53
Canada	8		2		1		11		362		373		19
France	7		—		—		7		473		480		16
U.K./Ireland	1		1		—		2		263		265		—
Central⁽¹⁾	1		1		1		3		353		356		6
Southern⁽²⁾	4		1		1		6		207		213		8
Nordics⁽³⁾	1		—		—		1		49		50		—
Total Europe	14		3		2		19		1,345		1,364		30
Other	3		—		—		3		59		62		—
Total	$	82	$	16	$	10	$	108	$	3,685	$	3,793	$	102

	December 31, 2017
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	18	$	3	$	1	$	22	$	597	$	619	$	12
Government and education	18		3		3		24		533		557		21
Graphic arts	12		1		—		13		309		322		6
Industrial	6		1		1		8		172		180		4
Healthcare	5		1		1		7		138		145		5
Other	7		1		1		9		197		206		3
Total United States	66		10		7		83		1,946		2,029		51
Canada	8		2		1		11		386		397		17
France	6		—		—		6		476		482		22
U.K./Ireland	3		—		—		3		263		266		—
Central⁽¹⁾	1		2		—		3		351		354		6
Southern⁽²⁾	4		1		1		6		203		209		6
Nordics⁽³⁾	—		—		—		—		51		51		—
Total Europe	14		3		1		18		1,344		1,362		34
Other	3		—		—		3		69		72		—
Total	$	91	$	15	$	9	$	115	$	3,745	$	3,860	$	102

_____________________________

(1)Switzerland, Germany, Austria, Belgium and Holland.

(2)Italy, Greece, Spain and Portugal.

(3)Sweden, Norway, Denmark and Finland.

Inventories (Tables)

3 Months Ended

Mar. 31, 2018

Inventory Disclosure [Abstract]

Inventories

The following is a summary of Inventories by major category:



	March 31, 2018		December 31, 2017
Finished goods	$	857	$	777
Work-in-process	49		49
Raw materials	95		89
Total Inventories	$	1,001	$	915

Investment in Affiliates, at Equity (Tables)

3 Months Ended

Mar. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Equity in net (loss) income of unconsolidated affiliates

Our Equity in net (loss) income of unconsolidated affiliates was as follows:



	Three Months Ended March 31,
	2018			2017
Fuji Xerox	$	(70	)	$	37
Other	2			3
Total Equity in net (loss) income of unconsolidated affiliates	$	(68	)	$	40

Summarized Financial Information Of Equity Investment - Fuji Xerox



	Three Months Ended March 31,
	2018			2017
Summary of Operations:
Revenues	$	2,465		$	2,559
Costs and expenses	2,771			2,352
(Loss) Income before Income Taxes	(306		)	207
Income tax (benefit) expense	(39		)	44
Net (Loss) Income	(267		)	163
Less: Net income attributable to noncontrolling interests	—			1
Net (Loss) Income – Fuji Xerox	$	(267	)	$	162
Weighted Average Exchange Rate⁽¹⁾	108.07			113.72

_____________________________


(1)	Represents Yen/U.S. Dollar exchange rate used to translate.

Restructuring Programs (Tables)

3 Months Ended

Mar. 31, 2018

Restructuring and Related Activities [Abstract]

Restructuring Program Activity

Information related to restructuring program activity is outlined below:



	Severance and Related Costs			Lease Cancellation and Other Costs			Asset Impairments⁽²⁾		Total
Balance at December 31, 2017	$	108		$	1		$	—	$	109
Provision	24			12			—		36
Reversals	(8		)	—			—		(8		)
Net current period charges⁽¹⁾	16			12			—		28
Charges against reserve and currency	(41		)	(11		)	—		(52		)
Balance at March 31, 2018	$	83		$	2		$	—	$	85

____________________________


(1)	Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown for restructuring and asset impairments charges.


(2)	Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision.

Reconciliation to the Condensed Consolidated Statements Of Cash Flows

The following table summarizes the reconciliation to the Condensed Consolidated Statements of Cash Flows:



	Three Months Ended March 31,
	2018			2017
Charges against reserve and currency	$	(52	)	$	(57	)
Effects of foreign currency and other non-cash items	(2		)	(1		)
Restructuring cash payments	$	(54	)	$	(58	)

Debt (Tables)

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Schedule Of Interest Expense And Income

Interest expense and income were as follows:



	Three Months Ended March 31,
	2018		2017
Interest expense⁽¹⁾	$	65	$	69
Interest income⁽²⁾	74		78

____________


(1)	Includes Cost of financing as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income.


(2)	Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income.

Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

The following is a summary of our fair value hedges at March 31, 2018:



Debt Instrument	Year First Designated	Notional Amount		Net Fair Value			Weighted Average Interest Rate Paid		Interest Rate Received		Basis	Maturity
Senior Note 2021	2014	$	300	$	(4	)	2.85	%	4.5	%	Libor	2021

Summary of Derivative Instruments Fair Value

The following table provides a summary of the fair value amounts of our derivative instruments:



Designation of Derivatives	Balance Sheet Location	March 31, 2018			December 31, 2017
Derivatives Designated as Hedging Instruments
Foreign exchange contracts - forwards	Other current assets	$	5		$	1
	Other current liabilities	(4		)	(15		)
Foreign currency options	Other current assets	3			—
Interest rate swaps	Other long-term assets	—			1
	Other long-term liabilities	(4		)	—
	Net designated derivative liability	$	—		$	(13	)

Derivatives NOT Designated as Hedging Instruments
Foreign exchange contracts – forwards	Other current assets	$	4		$	1
	Other current liabilities	(2		)	(10		)
	Net undesignated derivative asset (liability)	$	2		$	(9	)

Summary of Derivatives	Total Derivative Assets	$	12		$	3
	Total Derivative Liabilities	(10		)	(25		)
	Net Derivative asset (liability)	$	2		$	(22	)

Derivative Instruments, Gain (Loss)

The following table provides a summary of gains (losses) on derivative instruments:



	Three Months Ended March 31,
Gain (Loss) on Derivative Instruments	2018			2017
Fair Value Hedges - Interest Rate Contracts
Derivative loss recognized in interest expense	$	(5	)	$	(1	)
Hedged item gain recognized in interest expense	5			1

Cash Flow Hedges - Foreign Exchange Forward Contracts and Options
Derivative gain recognized in OCI (effective portion)	$	12		$	9
Derivative Loss reclassified from AOCL to income - Cost of sales (effective portion)	(12		)	(4		)

Summary of Derivatives Not Designated as Hedging Instruments Gains (Losses)

The following table provides a summary of gains on non-designated derivative instruments:



Derivatives NOT Designated as Hedging Instruments		Three Months Ended March 31,
Derivatives NOT Designated as Hedging Instruments	Location of Derivative Gain	2018		2017
Foreign exchange contracts – forwards	Other expense – Currency gain, net	$	—	$	4

Fair Value of Financial Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair value of financial assets and liabilities



	March 31, 2018		December 31, 2017
Assets:
Foreign exchange contracts - forwards	$	9	$	2
Foreign currency options	3		—
Interest rate swaps	—		1
Deferred compensation investments in mutual funds	18		18
Total	$	30	$	21
Liabilities:
Foreign exchange contracts - forwards	$	6	$	25
Interest rate swaps	4		—
Deferred compensation plan liabilities	18		19
Total	$	28	$	44

Estimated fair values of financial assets and liabilities not measured at fair value on a recurring basis

The estimated fair values of our other financial assets and liabilities were as follows:



	March 31, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents	$	1,398	$	1,398	$	1,293	$	1,293
Accounts receivable, net	1,326		1,326		1,357		1,357
Short-term debt	678		679		282		283
Long-term debt	4,811		4,880		5,235		5,373

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

Components of net periodic benefit cost and other changes in plan assets and benefit obligations

Employee Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2018

Retirement Benefits [Abstract]

The components of Net periodic benefit cost and other changes in plan assets and benefit obligations were as follows:



	Three Months Ended March 31,
	Pension Benefits
	U.S. Plans						Non-U.S. Plans						Retiree Health
Components of Net Periodic Benefit Costs:	2018			2017			2018			2017			2018			2017
Service cost	$	1		$	1		$	6		$	7		$	1		$	1
Interest cost	33			34			39			39			6			7
Expected return on plan assets	(34		)	(31		)	(63		)	(53		)	—			—
Recognized net actuarial loss	6			5			15			19			—			—
Amortization of prior service credit	—			—			(1		)	(1		)	(1		)	(1		)
Recognized settlement loss	25			42			—			—			—			—
Defined benefit plans	31			51			(4		)	11			6			7
Defined contribution plans	6			6			7			7			n/a			n/a
Net Periodic Benefit Cost	37			57			3			18			6			7

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Net actuarial (gain) loss⁽¹⁾	(58		)	8			—			—			—			—
Amortization of net actuarial loss	(31		)	(47		)	(15		)	(19		)	—			—
Amortization of prior service credit	—			—			1			1			1			1
Total Recognized in Other Comprehensive Income⁽²⁾	(89		)	(39		)	(14		)	(18		)	1			1
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income	$	(52	)	$	18		$	(11	)	$	—		$	7		$	8

__________


(1)	The net actuarial (gain) loss for U.S. Plans primarily reflects the re-measurement of our primary U.S. pension plans as a result of the payment of periodic settlements.


(2)	Amounts represent the pre-tax effect included within Other comprehensive Income. Refer to Note 17 - Other Comprehensive Income for related tax effects and the after-tax amounts.

Defined Benefit and Retiree Health Pension Plans, actual and expected cash contributions

Contributions

The following table summarizes cash contributions to our defined benefit pension plans and retiree health benefit plans.



	Three Months Ended March 31,				Year Ended December 31,
	2018		2017		Estimated 2018		2017
U.S. plans	$	8	$	6	$	76	$	675
Non-U.S. plans	30		17		116		161
Total Pension	$	38	$	23	$	192	$	836

Retiree Health	$	15	$	14	$	62	$	64

Shareholders' Equity (Tables)

3 Months Ended

Mar. 31, 2018

Stockholders' Equity Note [Abstract]

Schedule of Stockholders Equity



	Common Stock		Additional Paid-in Capital		Retained Earnings			AOCL⁽⁴⁾			Xerox Shareholders’ Equity			Non-controlling Interests			Total Equity
Balance at December 31, 2017	$	255	$	3,893	$	4,856		$	(3,748	)	$	5,256		$	37		$	5,293
Cumulative effect of change in accounting principle⁽¹⁾	—		—		117			—			117			—			117
Comprehensive income, net	—		—		23			211			234			3			237
Cash dividends declared - common⁽²⁾	—		—		(65		)	—			(65		)	—			(65		)
Cash dividends declared - preferred⁽³⁾	—		—		(4		)	—			(4		)	—			(4		)
Stock option and incentive plans, net	—		15		—			—			15			—			15
Distributions to noncontrolling interests	—		—		—			—			—			(11		)	(11		)
Balance at March 31, 2018	$	255	$	3,908	$	4,927		$	(3,537	)	$	5,553		$	29		$	5,582



	Common Stock		Additional Paid-in Capital		Retained Earnings			AOCL⁽⁴⁾			Xerox Shareholders’ Equity			Non- controlling Interests			Total Equity
Balance at December 31, 2016	$	254	$	3,858	$	4,934		$	(4,337	)	$	4,709		$	38		$	4,747
Comprehensive income, net	—		—		40			166			206			3			209
Cash dividends declared - common⁽²⁾	—		—		(64		)	—			(64		)	—			(64		)
Cash dividends declared - preferred⁽³⁾	—		—		(4		)	—			(4		)	—			(4		)
Stock option and incentive plans, net	—		6		—			—			6			—			6
Distributions to noncontrolling interests	—		—		—			—			—			(1		)	(1		)
Balance at March 31, 2017	$	254	$	3,864	$	4,906		$	(4,171	)	$	4,853		$	40		$	4,893

_____________________________

(1)Refer to Note 3 - Adoption of New Revenue Recognition Standard for additional information.

(2)Cash dividends declared on common stock of $0.25 per share in the first quarter of 2018 and 2017.

(3)Cash dividends declared on preferred stock of $20.00 per share in the first quarter of 2018 and 2017.

(4)Refer to Note 17 - Other Comprehensive Income for components of AOCL.

Other Comprehensive Income (Tables)

3 Months Ended

Mar. 31, 2018

Other Comprehensive Income (Loss) [Abstract]

Schedule of Other Comprehensive Income

Other Comprehensive Income is comprised of the following:



	Three Months Ended March 31,
	2018						2017
	Pre-tax			Net of Tax			Pre-tax			Net of Tax
Translation Adjustments Gains	$	184		$	176		$	134		$	133
Unrealized Gains (Losses):
Changes in fair value of cash flow hedges - gains	12			8			9			6
Changes in cash flow hedges reclassed to earnings⁽¹⁾	12			10			4			2
Other losses	(1		)	(1		)	—			—
Net unrealized gains	23			17			13			8

Defined Benefit Plans Gains (Losses):
Net actuarial/prior service gains (losses)	58			43			(8		)	(5		)
Prior service amortization⁽²⁾	(2		)	(1		)	(2		)	(1		)
Actuarial loss amortization/settlement⁽²⁾	46			35			66			44
Fuji Xerox changes in defined benefit plans, net⁽³⁾	(21		)	(21		)	13			13
Other losses⁽⁴⁾	(38		)	(38		)	(25		)	(25		)
Changes in defined benefit plans gains	43			18			44			26

Other Comprehensive Income	250			211			191			167
Less: Other comprehensive income attributable to noncontrolling interests	—			—			1			1
Other Comprehensive Income Attributable to Xerox	$	250		$	211		$	190		$	166

_____________________________


(1)	Reclassified to Cost of sales - refer to Note 13 - Financial Instruments for additional information regarding our cash flow hedges.


(2)	Reclassified to Total Net Periodic Benefit Cost - refer to Note 15 - Employee Benefit Plans for additional information.


(3)	Represents our share of Fuji Xerox's benefit plan changes.


(4)	Primarily represents currency impact on cumulative amount of benefit plan net actuarial losses and prior service credits in AOCL.

Schedule of Accumulated Other Comprehensive Loss

AOCL is comprised of the following:



	March 31, 2018			December 31, 2017
Cumulative translation adjustments	$	(1,605	)	$	(1,781	)
Other unrealized gains (losses), net	5			(12		)
Benefit plans net actuarial losses and prior service credits⁽¹⁾	(1,937		)	(1,955		)
Total Accumulated other comprehensive loss attributable to Xerox	$	(3,537	)	$	(3,748	)

_____________________________


(1)	Includes our share of Fuji Xerox.

Earnings per Share (Tables)

3 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Basic and Diluted Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share of common stock (shares in thousands):



	Three Months Ended March 31,
	2018			2017
Basic Earnings (Loss) per Share:
Net Income from Continuing Operations Attributable to Xerox	$	23		$	46
Accrued dividends on preferred stock	(4		)	(4		)
Adjusted Net income from continuing operations available to common shareholders	19			42
Net loss from discontinued operations attributable to Xerox	—			(6		)
Adjusted Net income available to common shareholders	$	19		$	36

Weighted average common shares outstanding	254,660			254,038
Basic Earnings (Loss) per Share:
Continuing operations	$	0.08		$	0.17
Discontinued operations	—			(0.03		)
Basic Earnings per Share	$	0.08		$	0.14

Diluted Earnings (Loss) per Share:
Net Income from Continuing Operations Attributable to Xerox	$	23		$	46
Accrued dividends on preferred stock	(4		)	(4		)
Adjusted Net income from continuing operations available to common shareholders	19			42
Net loss from discontinued operations attributable to Xerox	—			(6		)
Adjusted Net income available to common shareholders	$	19		$	36

Weighted average common shares outstanding	254,660			254,038
Common shares issuable with respect to:
Restricted stock and performance shares	2,810			2,104
Adjusted Weighted average common shares outstanding	257,470			256,142
Diluted Earnings (Loss) per Share:
Continuing operations	$	0.08		$	0.16
Discontinued operations	—			(0.02		)
Diluted Earnings per Share	$	0.08		$	0.14

The following securities were not included in the computation of diluted earnings per share as they were either contingently issuable shares or shares that if included would have been anti-dilutive:
Stock options	—			—
Restricted stock and performance shares	2,977			3,937
Convertible preferred stock	6,742			6,742
Total Anti-Dilutive Securities	9,719			10,679

Dividends per Common Share	$	0.25		$	0.25

Correction of Fuji Xerox Misstatement in Prior Period Financial Statements (Details)
$ / shares in Units, $ in Millions, ¥ in Billions

3 Months Ended

Mar. 31, 2018

JPY (¥)

Mar. 31, 2018

USD ($)

$ / shares

Mar. 31, 2017

JPY (¥)

¥ / $

Mar. 31, 2017

USD ($)

$ / shares

¥ / $

Yen/U.S. Dollar Spot Exchange Rate | ¥ / $

111.89

Total Equity in net (loss) income of unconsolidated affiliates

^[1]

$ (68)

$ 40

Net Income from Continuing Operations Attributable to Xerox

$ 23

$ 46

Earnings per share from Continuing operations, Basic | $ / shares

$ 0.08

$ 0.17

Total Basic Earnings per Share | $ / shares

0.08

0.14

Earnings per share from continuing operations, Diluted | $ / shares

0.08

0.16

Total Diluted Earnings per Share | $ / shares

$ 0.08

$ 0.14

^[2]

$ 176

$ 133

Other Comprehensive Income, Net Attributable to Xerox

^[2]

211

167

211

166

237

209

Undistributed equity in net income of unconsolidated affiliates

234

206

$ 68

(40)

Adjustment [Member]

Total Equity in net (loss) income of unconsolidated affiliates

Net Income from Continuing Operations Attributable to Xerox

$ 24

Earnings per share from Continuing operations, Basic | $ / shares

$ 0.10

Total Basic Earnings per Share | $ / shares

0.09

Earnings per share from continuing operations, Diluted | $ / shares

0.09

Total Diluted Earnings per Share | $ / shares

$ 0.09

$ (3)

Other Comprehensive Income, Net Attributable to Xerox

(3)

(3)

Undistributed equity in net income of unconsolidated affiliates

(24)

As Reported [Member]

Total Equity in net (loss) income of unconsolidated affiliates

Net Income from Continuing Operations Attributable to Xerox

$ 22

Earnings per share from Continuing operations, Basic | $ / shares

$ 0.07

Total Basic Earnings per Share | $ / shares

0.05

Earnings per share from continuing operations, Diluted | $ / shares

0.07

Total Diluted Earnings per Share | $ / shares

$ 0.05

$ 136

Other Comprehensive Income, Net Attributable to Xerox

170

169

188

Undistributed equity in net income of unconsolidated affiliates

185

(16)

Fuji Xerox

Total Equity in net (loss) income of unconsolidated affiliates

Ownership percentage

25.00%

$ (70)

Fuji Xerox | Parent Company - Fujifilm Holdings Corporation | Adjustment [Member]

Fuji Xerox | Non Parent Equity Investment Owner - Xerox Corporation | Adjustment [Member]

¥ 12

110

¥ 40

360

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

$ 28

$ 90

[1]	Equity in net income of unconsolidated affiliates has been revised for the prior year period presented throughout this document. Refer to Note 2 - Correction of Fuji Xerox Misstatement in Prior Period Financial Statements for additional information on this revision.
[2]	Refer to Note 17 - Other Comprehensive Income for gross components of Other Comprehensive Income, reclassification adjustments out of Accumulated Other Comprehensive Loss and related tax effects.

Adoption of New Revenue Recognition Standard - Additional Information (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Jan. 01, 2018

Equipment sale performance obligation

$ 50

Increase to Sales

933

$ 936

Decrease to service revenue

(1,431)

$ (1,442)

Transition asset

153

Increase to retained earnings

^[1]

117

Contract liabilities

$ 87

$ 91

Contract liability amortization period

30 months

Incremental direct costs of obtaining a contract

$ 17

Amortization of incremental direct costs of obtaining a contract

Deferred incremental direct costs net of accumulated amortization

$ 179

Deferred incremental direct costs, amortization period

4 years

Contract Fulfillment Costs and Inducements

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

Incremental direct costs of obtaining a contract

$ 10

ASU 2014-09

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

Increase to Sales

Decrease to service revenue

Increase to retained earnings

$ 117

[1]	Refer to Note 3 - Adoption of New Revenue Recognition Standard for additional information.

Adoption of New Revenue Recognition Standard - Impacts of Adopting ASC Topic 606 (Details) - USD ($)
$ in Millions

Mar. 31, 2018

Dec. 31, 2017

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

Deferred tax assets

$ 942

$ 1,026

Other long-term assets

911

682

Retained earnings

4,927

$ 4,856

Superseded Revenue Guidance(1)

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

Deferred tax assets

^[1]

976

Other long-term assets

^[1]

764

Retained earnings

^[1]

4,814

Adjustments | ASU 2014-09

Revenue, Initial Application Period Cumulative Effect Transition [Line Items]

Deferred tax assets

(34)

Other long-term assets

147

Retained earnings

$ 113

[1]	Reflects balance of account under revenue recognition guidance superseded by ASC Topic 606.

Adoption of New Revenue Recognition Standard - Dissaggregation of Revenue (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

^[1]

$ 2,435

$ 2,454

Equipment

Supplies, paper and other sales

^[2]

499

502

434

Maintenance agreements

^[3]

631

640

Service arrangements

^[4]

623

622

Rental and other

177

180

Financing

Product

Product | Direct Equipment Lease

933

936

Product | Distributors & resellers

^[5]

160

Product | Direct equipment lease / Customer direct

^[6]

331

321

Service, Equipment Products

442

455

United States

^[1]

1,414

1,469

Europe

^[1]

676

640

Canada

^[1]

144

145

Other

^[1]

$ 201

$ 200

[1]	Geographic area data is based upon the location of the subsidiary reporting the revenue.
[2]	2017 Equipment sale revenues exclude $11 of equipment-related training revenue, which was classified as Services under previous revenue guidance - see "Adoption Summary" above.
[3]	Includes revenues from maintenance agreements on sold equipment as well as revenues associated with service agreements sold in our small and mid-sized business (SMB) focused channels and through our channel partners as Xerox Partner Print Services (XPPS).
[4]	Primarily includes revenues from our Managed Document Services (MDS) offerings. Also includes revenues from embedded operating leases, which were not significant.
[5]	Primarily reflects direct sales through bundled lease arrangements.
[6]	Primarily reflects sales through our two-tier distribution channels.

Recent Accounting Pronouncements (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales	$ 563		$ 565
Cost of services, maintenance and rentals	868		881
Research, development and engineering expenses	100		111
Selling, administrative and general expenses	628		634
Restructuring and related costs	28		118
Other expenses, net	32		114
ASU 2016-02 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating Leases, Future Minimum Payments Due		$ 450
ASU 2016-15 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Collections on Beneficial Interests Received in sales of Accounts Receivable and Finance Receivables			54
ASU 2016-18 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Restricted Cash and Cash Equivalents	$ 76	75
ASU 2017-07 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales			565
Cost of services, maintenance and rentals			881
Research, development and engineering expenses			111
Selling, administrative and general expenses			634
Restructuring and related costs			118
Other expenses, net			114
ASU 2018-05 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Tax Act estimated non-cash provisional charge		$ 400
As Reported [Member] \| ASU 2017-07 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales			567
Cost of services, maintenance and rentals			900
Research, development and engineering expenses			118
Selling, administrative and general expenses			664
Restructuring and related costs			120
Other expenses, net			54
Adjustments for New Accounting Pronouncement [Member] \| ASU 2017-07 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales			(2)
Cost of services, maintenance and rentals			(19)
Research, development and engineering expenses			(7)
Selling, administrative and general expenses			(30)
Restructuring and related costs			(2)
Other expenses, net			$ 60

Divestitures (Details) - USD ($) $ in Millions	3 Months Ended
Divestitures (Details) - USD ($) $ in Millions	Mar. 31, 2018	Mar. 31, 2017
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from discontinued operations, net of tax	$ 0	$ (6)
Conduent [Domain]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Date	Dec. 31, 2016
Loss from operations	$ 0	8
Loss on disposal	0	0
Net loss before income taxes	0	(8)
Income tax benefit	0	2
Loss from discontinued operations, net of tax	$ 0	$ (6)

Amount before tax of income (loss) from a discontinued operation. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

Amount after tax of income (loss) from a discontinued operation attributable to the parent. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.

Accounts, Notes, Loans and Financing Receivable [Line Items]

Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Restricted Cash and Cash Equivalents Items [Line Items]
Cash and cash equivalents	$ 1,398	$ 1,293
Tax and labor litigation deposits in Brazil	72	72
Other restricted cash	4	3
Total Restricted cash	76	75
Cash, cash equivalents and restricted cash	1,474	1,368	$ 1,194	$ 2,402
Other current assets	2	1
Other long-term assets	$ 74	$ 74

Accounts Receivable, Net (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Dec. 31, 2017

Accounts receivable, net

$ 1,326

$ 1,357

Accounts Receivable Sales Arrangements [Abstract]

Uncollected accounts receivable sold and derecognized

114

161

Accounts Receivable [Member]

Accounts, Notes, Loans and Financing Receivable [Line Items]

Invoiced

1,033

1,048

Accrued

352

368

Allowance for doubtful accounts

(59)

$ (59)

Accounts receivable sales(1)

^[1]

103

$ 511

Deferred proceeds

Loss on sales of accounts receivable

Estimated decrease to operating cash flows(2)

^[2]

$ (50)

$ (65)

[1]

[2]

Represents the difference between current and prior period receivable sales adjusted for the effects of: (i) the deferred proceeds, (ii) collections prior to the end of the quarter and, (iii) currency.

Finance Receivables, Net (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Financing Receivable, Allowance for Credit Losses [Roll Forward]

Financing Receivable, Collectively Evaluated for Impairment

$ 108

$ 110

(10)

^[1]

108

111

^[2]

3,793

3,817

Allowance for credit losses not included in the impairment evaluation

108

111

United States

Financing Receivable, Allowance for Credit Losses [Roll Forward]

Financing Receivable, Collectively Evaluated for Impairment

Charge-offs

(5)

(6)

Recoveries and other

^[1]

Ending Balance

^[2]

1,994

2,108

Canada

Financing Receivable, Allowance for Credit Losses [Roll Forward]

Financing Receivable, Collectively Evaluated for Impairment

Charge-offs

(1)

(2)

Recoveries and other

^[1]

Ending Balance

^[2]

373

382

Europe

Financing Receivable, Allowance for Credit Losses [Roll Forward]

Financing Receivable, Collectively Evaluated for Impairment

Charge-offs

(4)

(2)

Recoveries and other

^[1]

Ending Balance

^[2]

1,364

1,276

Other

Financing Receivable, Allowance for Credit Losses [Roll Forward]

^[3]

^[3]

^[3]

^[1],[3]

^[3]

Financing Receivable, Collectively Evaluated for Impairment

^[2],[3]

$ 62

$ 51

[1]	Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations.
[2]	Total Finance receivables exclude the allowance for credit losses of $108 and $111 at March 31, 2018 and 2017, respectively.
[3]	Includes developing market countries and smaller units.

Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Inventories, net [Abstract]
Finished goods	$ 857	$ 777
Work-in-process	49	49
Raw materials	95	89
Total Inventories	$ 1,001	$ 915

Investment in Affiliates, at Equity (Details)
$ in Millions, ¥ in Billions

3 Months Ended

Mar. 31, 2018

JPY (¥)

Mar. 31, 2018

USD ($)

Mar. 31, 2017

JPY (¥)

Mar. 31, 2017

USD ($)

Schedule of Equity Method Investments [Line Items]

Total Equity in net (loss) income of unconsolidated affiliates

$ (68)

^[1]

$ 40

^[1]

Restatement Adjustment [Member]

Schedule of Equity Method Investments [Line Items]

Total Equity in net (loss) income of unconsolidated affiliates

Fuji Xerox

Schedule of Equity Method Investments [Line Items]

Total Equity in net (loss) income of unconsolidated affiliates

$ (70)

Ownership percentage

25.00%

After-tax restructuring and other charges

$ 79

Summary of Operations:

Revenues

2,465

2,559

Costs and expenses

2,771

2,352

(Loss) Income before Income Taxes

(306)

207

Income tax (benefit) expense

(39)

Net (Loss) Income

(267)

163

Less: Net income attributable to noncontrolling interests

Net (Loss) Income – Fuji Xerox

$ (267)

$ 162

Weighted Average Exchange Rate

108.07

^[2]

108.07

^[2]

113.72

^[2]

113.72

^[2]

Fuji Xerox | Parent Company - Fujifilm Holdings Corporation | Restatement Adjustment [Member]

Schedule of Equity Method Investments [Line Items]

Fuji Xerox | Non Parent Equity Investment Owner - Xerox Corporation | Restatement Adjustment [Member]

¥ 12

$ 110

¥ 40

$ 360

Schedule of Equity Method Investments [Line Items]

Schedule of Equity Method Investments [Line Items]

Other

Total Equity in net (loss) income of unconsolidated affiliates

$ 2

$ 3

[1]	Equity in net income of unconsolidated affiliates has been revised for the prior year period presented throughout this document. Refer to Note 2 - Correction of Fuji Xerox Misstatement in Prior Period Financial Statements for additional information on this revision.
[2]	Represents Yen/U.S. Dollar exchange rate used to translate.

Restructuring Programs (Details)
$ in Millions

3 Months Ended

Mar. 31, 2018

USD ($)

Employees

Mar. 31, 2017

USD ($)

^[1]

$ 28

Restructuring and Related Cost, Expected Number of Positions Eliminated (approximately) | Employees

$ 36

400

$ (8)

109

(8)

^[1]

(52)

$ (57)

Reconciliation To Consolidated Statements Of Cash Flows [Abstract]

Effects of foreign currency and other non-cash items

(52)

(57)

(2)

(1)

Restructuring Cash Payments

(54)

$ (58)

Severance and Related Costs [Member]

^[1]

(8)

108

(8)

^[1]

(41)

Reconciliation To Consolidated Statements Of Cash Flows [Abstract]

Lease Cancellation and Other Costs [Member]

(41)

^[1]

^[1]

(11)

Reconciliation To Consolidated Statements Of Cash Flows [Abstract]

Asset Impairments [Member]

(11)

^[1],[2]

^[2]

^[2]

^[2]

^[2]

^[2]

^[1],[2]

^[2]

Reconciliation To Consolidated Statements Of Cash Flows [Abstract]

^[2]

^[2]

$ 0

[1]	Represents net amount recognized within the Condensed Consolidated Statements of Income for the period shown for restructuring and asset impairments charges.
[2]	Charges associated with asset impairments represent the write-down of the related assets to their new cost basis and are recorded concurrently with the recognition of the provision.

Debt - Interest Income and Expense (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Debt Disclosure [Abstract]

Interest expense

^[1]

$ 65

$ 69

Interest income

^[2]

$ 74

$ 78

[1]	Includes Cost of financing as well as non-financing interest expense that is included in Other expenses, net in the Condensed Consolidated Statements of Income.
[2]	Includes Finance income as well as other interest income that is included in Other expenses, net in the Condensed Consolidated Statements of Income.

Financial Instruments - Fair Value Hedges (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Derivative [Line Items]
Derivative, Notional Amount	$ 1,557	$ 1,788
Average Maturity of Foreign Exchange Hedging Contracts - within Three Months	70.00%
Average Maturity of Foreign Exchange Hedging Contracts - within Three and Six Months	20.00%
Average Maturity of Foreign Exchange Hedging Contracts - within Six and Twelve Months	10.00%
Senior Notes Due 2021 [Member]
Derivative [Line Items]
Notional Amount	$ 300
Derivative Asset, Fair Value, Gross Asset (Liability)	$ (4)
Weighted Average Interest Rate Paid	2.85%
Interest Rate Received	4.50%

Financial Instruments - Summary of Derivative Instruments Fair Value (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Net Derivative Asset (Liability)	$ 2	$ (22)
Assets [Member]
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Assets	12	3
Liabilities [Member]
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Liabilities	(10)	(25)
Derivatives Designated as Hedging Instruments [Member]
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Net Derivative Asset (Liability)	(4)	14
Derivatives Designated as Hedging Instruments [Member] \| Liabilities [Member]
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Net Derivative Asset (Liability)	0	(13)
Derivatives Designated as Hedging Instruments [Member] \| Foreign exchange contracts - forwards [Member] \| Other current assets
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Assets	5	1
Derivatives Designated as Hedging Instruments [Member] \| Foreign exchange contracts - forwards [Member] \| Other current liabilities
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Liabilities	(4)	(15)
Derivatives Designated as Hedging Instruments [Member] \| Options Held [Member] \| Other current assets
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Assets	3	0
Derivatives Designated as Hedging Instruments [Member] \| Interest Rate Swap [Member] \| Other long-term assets
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Assets	0	1
Derivatives Designated as Hedging Instruments [Member] \| Interest Rate Swap [Member] \| Other long-term liabilities
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Liabilities	(4)	0
Not Designated as Hedging Instrument [Member] \| Foreign exchange contracts - forwards [Member]
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Net Derivative Asset (Liability)	2	(9)
Not Designated as Hedging Instrument [Member] \| Foreign exchange contracts - forwards [Member] \| Other current assets
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Assets	4	1
Not Designated as Hedging Instrument [Member] \| Foreign exchange contracts - forwards [Member] \| Other current liabilities
Summary Of Derivative Instruments By Hedge Designation [Abstract]
Total Derivative Liabilities	$ (2)	$ (10)

Financial Instruments - Summary of Derivative Instruments Gain (Losses) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Summary of Derivative Instruments Gains (Losses) [Abstract]
Net gains recorded in AOCL expected to be reclassified to net income in the future	$ 5
Foreign Currency Transaction Gains (Losses), before Tax		$ (3)
Cash Flow Hedging [Member] \| Foreign Exchange Forward [Member]
Summary of Derivative Instruments Gains (Losses) [Abstract]
Derivative gain recognized in OCI (effective portion)	12	9
Interest Expense [Member] \| Fair Value Hedging [Member] \| Interest Rate Contract [Member]
Summary of Derivative Instruments Gains (Losses) [Abstract]
Derivative loss recognized in interest expense	(5)	(1)
Hedged item gain recognized in interest expense	5	1
Cost of Sales [Member] \| Cash Flow Hedging [Member] \| Foreign Exchange Forward [Member]
Summary of Derivative Instruments Gains (Losses) [Abstract]
Derivative Loss reclassified from AOCL to income - Cost of sales (effective portion)	(12)	(4)
Derivative loss reclassified from AOCL to income - Cost of Sales (ineffective)	0	0
Underlying, Derivative	0	0
Foreign Currency Gain (Loss) [Member] \| Foreign Exchange Forward [Member] \| Derivatives Not Designated as Hedging Instruments [Member]
Summary of Derivative Instruments Gains (Losses) [Abstract]
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net	$ 0	$ 4

Fair Value of Financial Assets and Liabilities - Recurring (Details) - Fair Value, Measurements, Recurring [Member] - Significant Other Observable Inputs (Level 2) [Member] - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Assets:
Interest rate swaps	$ 0	$ 1
Deferred compensation investments in mutual funds	18	18
Total	30	21
Liabilities:
Interest rate swaps	4	0
Deferred compensation plan liabilities	18	19
Total	28	44
Foreign Exchange Forward [Member]
Assets:
Foreign exchange contracts - forwards	9	2
Liabilities:
Foreign exchange contracts - forwards	6	25
Options Held [Member]
Assets:
Foreign currency options	$ 3	$ 0

Fair Value of Financial Assets and Liabilities - Nonrecurring (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 1,398	$ 1,293
Accounts receivable, net	1,326	1,357
Short-term debt	678	282
Long-term debt	4,811	5,235
Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	1,398	1,293
Accounts receivable, net	1,326	1,357
Short-term debt	679	283
Long-term debt	$ 4,880	$ 5,373

Employee Benefit Plans (Details) - USD ($)

3 Months Ended

12 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Dec. 31, 2017

Dec. 31, 2018

Other changes in plan assets and benefit obligations recognized in Other Comprehensive Income (Loss):

$ 27,000,000

$ 62,000,000

58,000,000

(8,000,000)

^[1]

46,000,000

66,000,000

^[1]

(2,000,000)

Pension Plan [Member]

Defined Benefit Plan, Plan Assets, Contributions by Employer

38,000,000

23,000,000

$ 836,000,000

Pension Plan [Member] | Forecast

Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year

$ 192,000,000

Pension Plan [Member] | Domestic Plan [Member]

Expected return on plan assets

Service cost

1,000,000

Interest cost

33,000,000

34,000,000

(34,000,000)

(31,000,000)

Recognized net actuarial loss

6,000,000

5,000,000

Recognized settlement loss

25,000,000

42,000,000

Defined contribution plans

31,000,000

51,000,000

6,000,000

Net Periodic Benefit Cost

37,000,000

57,000,000

Other changes in plan assets and benefit obligations recognized in Other Comprehensive Income (Loss):

^[2]

(58,000,000)

8,000,000

(31,000,000)

(47,000,000)

Total Recognized in Other Comprehensive Income(2)

^[3]

(89,000,000)

(39,000,000)

Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income

(52,000,000)

18,000,000

Defined Benefit Plan, Plan Assets, Contributions by Employer

8,000,000

6,000,000

675,000,000

Pension Plan [Member] | Domestic Plan [Member] | Forecast

Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year

76,000,000

Pension Plan [Member] | Domestic Plan [Member] | Minimum Funding Requirement [Member] | Qualified Plan [Member]

Defined Benefit Plan, Plan Assets, Contributions by Employer

Pension Plan [Member] | Domestic Plan [Member] | Voluntary Contributions [Member] | Qualified Plan [Member]

Defined Benefit Plan, Plan Assets, Contributions by Employer

50,000,000

Pension Plan [Member] | Foreign Plan [Member]

Expected return on plan assets

Service cost

6,000,000

7,000,000

Interest cost

39,000,000

(63,000,000)

(53,000,000)

Recognized net actuarial loss

15,000,000

19,000,000

Recognized settlement loss

(1,000,000)

Defined contribution plans

(4,000,000)

11,000,000

7,000,000

Net Periodic Benefit Cost

3,000,000

18,000,000

Other changes in plan assets and benefit obligations recognized in Other Comprehensive Income (Loss):

^[2]

(15,000,000)

(19,000,000)

Total Recognized in Other Comprehensive Income(2)

1,000,000

^[3]

(14,000,000)

(18,000,000)

Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income

(11,000,000)

Defined Benefit Plan, Plan Assets, Contributions by Employer

30,000,000

17,000,000

161,000,000

Pension Plan [Member] | Foreign Plan [Member] | Forecast

Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year

116,000,000

Retiree Health [Member]

Expected return on plan assets

Service cost

1,000,000

Interest cost

6,000,000

7,000,000

Recognized net actuarial loss

Recognized settlement loss

(1,000,000)

Net Periodic Benefit Cost

6,000,000

7,000,000

6,000,000

7,000,000

Other changes in plan assets and benefit obligations recognized in Other Comprehensive Income (Loss):

^[2]

Total Recognized in Other Comprehensive Income(2)

1,000,000

^[3]

1,000,000

Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income

7,000,000

8,000,000

Defined Benefit Plan, Plan Assets, Contributions by Employer

$ 15,000,000

$ 14,000,000

$ 64,000,000

Retiree Health [Member] | Forecast

Defined Benefit Plan, Expected Future Employer Contributions, Current Fiscal Year

$ 62,000,000

[1]	Reclassified to Total Net Periodic Benefit Cost - refer to Note 15 - Employee Benefit Plans for additional information.
[2]	The net actuarial (gain) loss for U.S. Plans primarily reflects the re-measurement of our primary U.S. pension plans as a result of the payment of periodic settlements.
[3]	Amounts represent the pre-tax effect included within Other comprehensive Income. Refer to Note 17 - Other Comprehensive Income for related tax effects and the after-tax amounts.

Shareholders' Equity (Details) - USD ($)
$ / shares in Units, $ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Noncontrolling Interests, Beginning Balance

$ 5,256

Total Equity, Beginning Balance

5,293

$ 4,747

Cumulative effect of change in accounting principle(1)

^[1]

117

Comprehensive income, net attributable to noncontrolling interests

234

206

237

209

^[2]

(65)

(64)

^[3]

(4)

Distributions and purchases - noncontrolling interests

(11)

(1)

Noncontrolling Interests, Ending Balance

5,553

Total Equity, Ending Balance

$ 5,582

$ 4,893

Dividends per common share (in dollars per share)

$ 0.25

Treasury Stock, Shares, Acquired (in shares)

Series B Preferred Stock [Member]

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Dividends per preferred share (in dollars per share)

$ 20.00

Xerox Shareholders’ Equity

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative effect of change in accounting principle(1)

$ 5,256

$ 4,709

^[1]

117

234

206

^[2]

(65)

(64)

^[3]

(4)

Distributions and purchases - noncontrolling interests

Increase (Decrease) in Stockholders' Equity [Roll Forward]

5,553

4,853

Common Stock

Cumulative effect of change in accounting principle(1)

255

254

^[1]

^[2]

^[3]

Distributions and purchases - noncontrolling interests

Additional Paid-in Capital

255

254

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative effect of change in accounting principle(1)

3,893

3,858

^[1]

^[2]

^[3]

Distributions and purchases - noncontrolling interests

Increase (Decrease) in Stockholders' Equity [Roll Forward]

3,908

3,864

Retained Earnings

Cumulative effect of change in accounting principle(1)

4,856

4,934

^[1]

117

^[2]

(65)

(64)

^[3]

(4)

Distributions and purchases - noncontrolling interests

Increase (Decrease) in Stockholders' Equity [Roll Forward]

4,927

4,906

AOCL

Cumulative effect of change in accounting principle(1)

^[4]

(3,748)

(4,337)

^[1],[4]

^[4]

211

166

^[2],[4]

^[3],[4]

Distributions and purchases - noncontrolling interests

^[4]

^[4]

Non-controlling Interests

^[4]

(3,537)

(4,171)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Noncontrolling Interests, Beginning Balance

Cumulative effect of change in accounting principle(1)

^[1]

Comprehensive income, net attributable to noncontrolling interests

^[2]

^[3]