Thread regarding Xerox Corp. layoffs

Finally, some smart people. Thanks for this. May help some of the nitwits posting here. But I doubt it. Hopefully the "lets do an employee survey to help the SLT" guy will get somebody to read this post to him.

Goodwill Impairment Guy @by+1kavaa8pb, @OP here.

You’re directionally right: nobody with a calculator thinks layoffs alone will fix a multi-billion-dollar leverage problem. On that part, you’re spot on.

Where I’m not fully buying your take is the idea that management is intentionally driving toward a Chapter 7 liquidation.

That’s the least likely endgame; creditors and boards almost always push for Chapter 11 or a negotiated out-of-court restructuring first, because everyone loses far less that way.

Chapter 7 is a fire sale: lenders get scraps, equity is vaporized, pensions end up at PBGC with cuts, and executives don’t walk out looking like geniuses (well, they never did).

A more realistic interpretation is simpler and more depressing: bad strategy, too much debt, denial, and an overstretched balance sheet.

If the company runs out of cash and refinancing options, a court-driven restructuring becomes possible, even plausible—but deliberate Chapter 7 is a tail scenario, not the central one.

I would say that “management is steering toward liquidation on purpose” overestimates their cunning and underestimates their usual mismanagement.

@b5 Appreciate your comment. Building on it. Lexmark leadership drove their company to significant debt. Lexmark leadership is clueless about speed bands above 35ppm. Lexmark Leadership is clueless about Xerox production and digital solution offerings. Yet Lexmark leadership is now responsible for it. I have no question as to why the street and investors are pulling back from this joint adventure and giving the joint adventure negative ratings. Heck a company who’s designated leadership who has not demonstrated measurable success (aka the street, Moody’s , etc) in any past capacity should not be included in any retirement plan. They would not be doing their fiduciary responsibilities.

Hi, it's the Goodwill Impairment Guy.

@OP Great post! But I don't think it's as bad as you post makes the situation out to be: I think it's much worse.

Everybody, including me, has been waiting for a massive round of layoffs, To date, only a handful of people have been let go, in the scheme of things. Why?

This is where we get to the really spooky s$!# show part of the story. With the current debt load, and inability to borrow money at reasonable rates - if at all -we are at the point where a massive IRIF (10%, 20%, 30%, 40%) would not be enough savings to right the ship.

Instead of trying, management is steering into the iceberg, in hopes of CH7.

In CH7:
Billions in debt settle for pennies on the dollar.
The 1BN in unfunded Pension liabilities - gone. Let government insurance make the retirees whole.
Boardmembers, retained most likely through reorganization, along with upper SLT that aimed or the iceberg.
IRIFs balloon to perhaps 50% or more.
Bond and Equity holders - wiped out.

ITsavvy and Lexmark were just buying time to cash more checks, and it worked, just not as long as they had hoped..

There is No Chance of Success here.

It’s a pyramid scheme. 🔺🔺🔺

As long as it keeps going, you can manage, once it stops or slows, you have issues everywhere. Shortly after that it all collapses and you are left in the middle of a debris field.

Hot wheels toy race sounds right. It was the combined whim of the departed Disruption Officer (still don’t know what that role was) and the new CMO. So I wonder if the new CMO will keep it as making cuts everywhere else. Managed by Lexmark sounds and is right. Never heard of buying a failing company and then just rolling over. The SLT are weak beyond belief. If there is any chance of growth the focus has to be on everything other than print yet the sales leaders they have put in place only know print.

Hey Write-a-Novel guy's back 📚

Well said. Synergies just means now we have 2 CFO's, one can go. There is no "if" to revenue dropping. Google XRX 10 year revenue table. If SB were able to halve the number of employees tomorrow, there is still no hope. Basically combined 2 failing entities and doubles the staff. He is not even trying. Its just a matter of time, and the amount of time will be determined by the banks. BUT remember the old saying, if you owe the bank $1M the bank owns you, if you owe the bank $1B you own the bank. There is not good ending to any of this except for SB and his minions. He will probably leave to be the president of his sh-t community college shortly.

@OP you nailed it. The credit rating is screaming default. Forget the stock for a second, if you can’t get cash you can’t make payroll. Not paying bills you are headed for disaster. The death spiral is real. It’s hard to watch.

TLDR