Financial Highlights
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Financial Highlights

(in millions, except EPS) 2017 2016
Total revenue $10,265 $10,771
Equipment sales 2,251 2,419
Post-sale revenue 8,014 8,352
Net income from continuing operations – Xerox 192 622
Adjusted net income – Xerox(1) 915 927
Diluted earnings per share from continuing operations 0.70 2.33
Adjusted earnings per share(1) 3.48 3.53
Net cash provided by operating activities of continuing operations 122 1,018
Adjusted operating margin(1) 12.8% 12.5%

(1) See Non-GAAP Measures below for the reconciliation of the difference between this financial measure that is not in compliance with Generally Accepted Accounting Principles (GAAP) and the most directly comparable financial measure calculated in accordance with GAAP.

Financial Measures

Total Revenue (in millions)
Adjusted Operating Margin (1)
Post-Sale Revenue (in millions – percent of total revenue)
Net Income from Continuing Operations – Xerox (in millions)
Net Cash from Operating Activities - Continuing Operations (in millions)
Equipment Revenue (in millions – percent of total revenue)

(1) See Non-GAAP Measures below for the reconciliation of the difference between this financial measure that is not in compliance with Generally Accepted Accounting Principles (GAAP) and the most directly comparable financial measure calculated in accordance with GAAP.

Non-GAAP Measures

Adjusted Earnings per Share (EPS) Year Ended December 31,
2017 2016 2015 2014
(in millions, except per share amounts) Net Income EPS Net Income EPS Net Income EPS Net Income
Reported(1) $192 $0.70 $622 $2.33 $822 $2.97 $1,011
Adjustments:
Restructuring and related costs – Xerox 220 264 27 106
Amortization of intangible assets 53 58 60 65
Non-service retirement-related costs 198 131 116 79
Loss on extinguishment of debt 20 – – –
Transaction and proxy-related fees 9 – – –
Income tax on adjustments (171) (151) (77) (90)
U.S. Tax Act 400 – – –
Remeasurement of unrecognized tax positions (16) – – –
Deferred tax liability adjustment – – – (44)
Restructuring and other charges – Fuji Xerox(2) 10 3 4 3
Adjusted $915 $3.48 $927 $3.53 $952 $3.45 $1,130
Dividends on preferred stock used in adjusted EPS calculation(3) $    – $24 $24
Weighted average shares for adjusted EPS(3) 263 256 269

(1) Net income and EPS from continuing operations attributable to Xerox. (2) Other charges in 2017 represent audit and other fees associated with the independent investigation of Fuji Xerox’s accounting practices. (3) For those periods that exclude the preferred stock dividend, the average shares for the calculations of diluted EPS include 7 million shares associated with our Series A or Series B convertible preferred stock, as applicable.

Operating Income/Margin Reconciliation Year Ended December 31,
2017 2016 2015 2014
(in millions) Profit Revenue Margin Profit Revenue Margin Profit Revenue Margin Profit Revenue Margin
Reported(1) $570 $10,265 5.6% $568 $10,771 5.3% $924 $11,465 8.1% $1,090 $12,679 8.6%
Adjustments:
Restructuring and related costs – Xerox 220 264 27 106
Amortization of intangible assets 53 58 60 65
Non-service retirement-related costs 198 131 116 79
Transaction and proxy-related fees 9 – – –
Equity in net income of unconsolidated affiliates 115 127 109 145
Restructuring and other costs – Fuji Xerox(2) 10 3 4 3
Other expenses, net 141 200 195 185
Adjusted $1,316 $10,265 12.8% $1,351 $10,771 12.5% $1,435 $11,465 12.5% $1,673 $12,679 13.2%

(1) Pre-tax income and revenue from continuing operations. (2) Other charges in 2017 represent audit and other fees associated with the independent investigation of Fuji Xerox's accounting practices.

Operating Cash Flow Reconciliation Year Ended December 31,
(in millions) 2017
Reported(1) $122
Adjustments:
Voluntary contribution to U.S. defined benefit pension plans 500
Elimination of certain accounts receivable sales programs 350
Adjusted $972

(1) Net cash provided by operating activities of continuing operations.

Form 10-K

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