Conduent Incorporated (NASDAQ: CNDT) reported its third-quarter 2025 results on Friday, posting mixed financials that showed improved profitability but continued revenue declines. The company's stock traded around $2.22, down about 4% in the hours following the announcement, reflecting investor caution despite signs of operational progress.
For the quarter ended September 30, 2025, Conduent reported revenue of $767 million, a decline of roughly 5% year over year. Adjusted EBITDA rose to $40 million, up about 25% from the same quarter in 2024, lifting the adjusted EBITDA margin to 5.2% from 4.1% a year ago. The company said the margin expansion reflected stronger cost discipline and operational efficiencies.
On a GAAP basis, Conduent recorded a pre-tax loss of $38 million, compared to a $159 million profit in the third quarter of 2024. Diluted GAAP earnings per share swung to a loss of $0.30, versus earnings of $0.72 in the prior year. Operating cash flow was negative $39 million, and adjusted free cash flow stood at –$54 million, underscoring continued weakness in cash generation.
Management highlighted several strategic moves during the quarter, including the completion of a debt refinancing program and the repurchase of approximately 4.7 million shares, signaling confidence in the company's long-term value. Liquidity remains solid, with roughly $264 million in cash and an unused $198 million credit facility.
Despite the earnings improvement on an adjusted basis, investors appear focused on Conduent's ongoing revenue contraction and negative cash flow, key challenges that have persisted amid efforts to streamline operations and refocus on higher-margin opportunities. The company met guidance on adjusted revenue and margin, which may offer some reassurance, but analysts remain cautious about the sustainability of the turnaround without topline stabilization.
Market reaction to the results reflected this mixed picture. While the margin expansion and liquidity strength suggest incremental progress, the company's shrinking revenue base and GAAP losses continue to weigh on sentiment. For Conduent's stock, near-term performance is likely to hinge on management's ability to reverse the revenue decline and convert improving margins into consistent cash flow, both critical milestones for rebuilding investor confidence.
