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Conduent unveils ASCEND plan: AI push, divestitures and 10% margin target. October 1, 2026 Key points. * Conduent plans to divest its transportation businesses for $234 million in gross proceeds, using most of the cash to reduce debt while lowering capital intensity and off-balance-sheet exposure. * The ASCEND plan targets at least $120 million in cost reductions and adjusted EBITDA margin growth from 6.5%-7.6% in 2026 to approximately 10% by 2028, alongside a return to low- to mid-single-digit revenue growth. * Conduent is making AI central to its commercial and government-services strategy, targeting major productivity gains by 2028 while expanding healthcare, financial, enterprise and Medicaid offerings. * Five stocks to consider instead of Conduent. Conduent NASDAQ: CNDT outlined its ASCEND 2026-2028 strategy at its investor day, presenting a plan centered on divesting its transportation businesses, reducing costs, strengthening its commercial and government operations, and expanding the use of artificial intelligence. Chief Executive Officer Harsha V. Agadi said the company is positioning itself as an "AI-led, technology-enabled" business-process-services partner for government and commercial clients. He said the company's strategy has three stages: reset and stabilize, simplify operations, and execute the ASCEND plan. Agadi said Conduent serves 46 of 50 U.S. states, 31 Fortune 100 companies, eight of the top 15 U.S. health plans and four of the top 10 U.S. banks. The company's top 20 clients have been customers for more than 20 years on average, according to Agadi. He also said Conduent has approximately 46,000 employees, down from roughly 60,000 at the start of the year. Transportation divestitures and financial targets. Chief Financial Officer Giles Goodburn said the company's financial presentation excluded public transit and tolling operations, which Conduent is divesting. The transactions carry a headline value of $234 million in gross proceeds, plus a retained stake in Quarterhill, the buyer of the tolling business. Conduent expects to receive nearly $200 million of proceeds at closing before year-end, with remaining proceeds to be received over time, primarily through transit-related holdbacks. Goodburn said tax leakage and transaction costs are expected to be less than $10 million, and that proceeds will predominantly be used to reduce debt. The divestitures also are expected to reduce capital intensity and remove a substantial portion of Conduent's off-balance-sheet exposures. During the question-and-answer session, Goodburn said Conduent has more than $500 million of off-balance-sheet instruments, with about 80% tied to transportation contracts. Following the divestitures, Conduent expects 2026 revenue of $2.15 billion to $2.25 billion and adjusted EBITDA margins of 6.5% to 7.6%. The company expects revenue to be flat in 2027 before returning to low- to mid-single-digit growth in 2028. Conduent is targeting approximately 150 basis points of adjusted EBITDA margin expansion annually, reaching about 10% in 2028. Discover more Business News The company also expects to execute at least $120 million of cost reductions, about half of which are expected to come from workforce-related actions. Goodburn said roughly $30 million of savings will be resident in 2026, with $90 million accruing through 2028. Longer term, Conduent said it expects to progress toward 15% adjusted EBITDA margins and to convert at least 20% of adjusted EBITDA into free cash flow. Commercial and government growth initiatives. Kimberly Marshall, Conduent's chief commercial officer, said the company has established a commercial operating model designed to standardize opportunity qualification, specialize around selected markets and scale offerings with demonstrated demand and economics. She said client and sales-team coverage has risen 60% over the past 10 months, new-business pipeline has increased 12% year to date, and new-logo pipeline has grown 106%. Conduent's commercial priorities are healthcare operations, financial operations and enterprise operations. Marshall said the company aims to build annual qualified commercial pipeline to $1 billion by 2028, with new-logo clients accounting for 30% of the total pipeline. George Wehbe, president of Commercial Solutions, said commercial adjusted EBITDA margin improved 120 basis points in the first half of 2026. He said the segment sees an annualized expense-reduction opportunity of $80 million in 2027 through leadership changes, fewer management layers, consolidated functions, vendor reductions and work on underperforming accounts. In Government Solutions, President Anna Sever highlighted Conduent's cloud-native Conduent Medicaid Enterprise System, or CMdS. The platform recently replaced a 24-year-old legacy system in New Mexico and supports about 900,000 Medicaid enrollees. Conduent also announced a multiyear renewal in Virginia supporting approximately 1.6 million Medicaid enrollees. Sever said Conduent's government pipeline is approximately $2.7 billion for 2027, while its five-year pipeline exceeds $17 billion. She said the company estimates the government addressable market at $18.4 billion, where Conduent currently has roughly 5% penetration, and cited a $41 billion federal health and civilian-agency market as another expansion opportunity. AI deployment and productivity targets. Conduent's leaders repeatedly identified AI as a key element of its growth and margin strategy. Narayanan Sundaresan, chief information and technology officer, said the company plans to embed AI in client solutions while redesigning internal workflows, migrating more infrastructure to hyperscale cloud providers, building a data lake and expanding security controls. Wehbe said Conduent has already deployed AI-assisted code review, reducing peer-review time by 70%, and used AI to accelerate a legacy-code migration project that traditionally would have taken three to six months into less than four weeks. By the first quarter of 2028, the company is targeting a 30% to 40% improvement in AI-enabled software-engineering throughput, 10% to 15% less effort in selected operational workflows, and twice the migration speed to current product platforms. The company also cited results from its Conni AI platform, including 86% of inquiries resolved without a human agent, ninefold higher consumer engagement, 21% fewer live-agent interactions and a 24% reduction in average handle time in a healthcare use case. Agadi said Conduent is focused on moving beyond its recent restructuring and demonstrating more consistent execution. "This is a new Conduent," he said, emphasizing growth, accountability, cost discipline and portfolio focus. About Conduent (NASDAQ:CNDT). Conduent Incorporated NASDAQ: CNDT is a business services and technology company that provides digital platforms, transaction processing and business process services to government agencies and commercial organizations. Its solutions are designed to help clients manage customer interactions, administrative workflows, payments and other high-volume, mission-critical processes. The company's government services include public benefits administration, healthcare and Medicaid support, child support services, workforce and student loan programs, and other public-sector operations. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. Before you consider Conduent, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Conduent wasn't on the list. While Conduent currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys. 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Conduent outlines three-year path to consistent growth and profitable performance at Investor Day. September 30, 2026 Company outlines focused strategy to simplify operations, leverage AI and scale growth across Government and Commercial markets Conduent Incorporated (Nasdaq: CNDT), a global technology-driven business solutions and services company, today outlined its strategy and three-year path to consistent growth and profitable performance at its Investor Day in New York City. Led by President and CEO Harsha V. Agadi, Conduent outlined its ASCEND 2026-28 framework, which is designed to accelerate profitable growth through three strategic priorities: Standardize operations and infrastructure, Specialize in core solutions where Conduent can lead and win, and Scale its go-to-market capabilities around priority industries and opportunities. "We have taken decisive steps to strengthen and simplify Conduent, and we now have a clear strategy for the next phase of growth. We are focused on executing with discipline, leveraging AI and our differentiated capabilities to deepen client relationships, expand in our core markets and deliver greater value for our clients and shareholders," said Harsha V. Agadi, President and CEO, Conduent. At Investor Day, Agadi highlighted several areas of focus for the next phase of Conduent's transformation: * A more focused portfolio: Announced portfolio actions are simplifying the company and concentrating resources on markets where Conduent has the capabilities and scale to compete and grow. * AI-led innovation: Conduent is embedding AI, automation and analytics more deeply across its solutions to improve client outcomes, increase differentiation and create new opportunities for growth. * Greater operational efficiency: ASCEND calls for greater standardization of operations and technology infrastructure, increased use of shared services and stronger performance management and analytics. * A sharper go-to-market approach: Conduent plans to align sales resources around priority industries and opportunities, expand within its existing client base and pursue targeted new-logo growth. * Disciplined execution: With the foundational reset underway, the company is shifting its focus toward execution, accountability and measurable results. Conduent's strategy is centered on its Government and Commercial businesses, with particular focus on healthcare and financial operations, where the company has longstanding client relationships, domain expertise and proprietary technology capabilities. The company operates across 22 countries with more than 100 delivery locations. Additional information regarding Conduent's strategy and three-year outlook is available in the Company's Form 8-K furnished today with the U.S. Securities and Exchange Commission and the Investor Day presentation available on the Company's Investor Relations website. Investor Day Webcast Conduent's Investor Day will begin at 8:25 a.m. ET today and will be accessible to the public via webcast. The event will feature presentations from Agadi and members of Conduent's senior leadership team, followed by a question-and-answer session. The webcast and accompanying presentation materials will be available on Conduent's Investor Relations website. About Conduent Conduent is a global technology-enabled operating partner that helps businesses and governments simplify complexity, modernize mission-critical operations and deliver measurable outcomes through AI, automation, data and human expertise. Learn more at www.conduent.com. Forward-looking statements This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended, and is made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as anticipate, believe, estimate, expect, intend, plan, project, target, will and similar expressions identify forward-looking statements, although not all forward-looking statements contain these words. These statements include, among others, statements regarding the Company's ASCEND 2026-28 framework and strategic priorities; expected revenue, revenue growth and revenue mix; expected profitability, margin and cash flow; identified cost reduction initiatives and the amount, timing and realization of related savings; the expected completion, timing and proceeds of the announced divestitures of the Transit and Tolling businesses; the Company's capital structure and expected leverage reduction; and the Company's artificial intelligence strategy, deployments and anticipated client outcomes. Forward-looking statements are not guarantees of future performance. They are based on management's current expectations and assumptions, are subject to known and unknown risks and uncertainties, many of which are outside the Company's control, and actual results may differ materially. Factors that could cause actual results to differ materially include, among others, the Company's ability to execute the ASCEND 2026-28 plan and realize expected cost savings on the anticipated timeline or at all; the Company's ability to retain and renew client contracts and win new business, and the timing of conversion of contract value into revenue; risks relating to the completion of the announced divestitures, including the satisfaction of closing conditions and receipt of required consents; the Company's level of indebtedness and its ability to refinance, extend or replace its indebtedness, including its revolving credit facility and receivables facilities, on acceptable terms or at all; reliance on government clients and exposure to government budgets and procurement practices; information security and data privacy risks; legal and regulatory proceedings; the Company's ability to develop and deploy artificial intelligence and achieve the anticipated benefits; and the other factors described under Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2025 and in its subsequent Quarterly Reports on Form 10-Q, available at investor.conduent.com and www.sec.gov. Forward-looking statements speak only as of the date of this release, and the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Investor Relations Contact: Nick Goel, Conduent, [email protected]