Conduent Incorporated : 2023 Annual Report 032624

2023 Annual Report

Elevating client outcomes every day

Digital business solutions to enhance performance, experience and value

Cliff Skelton

Looking ahead, our unwavering focus is to deliver better outcomes through improved performance, experience and value for our clients by streamlining operations, reducing cost, elevating end-user experiences and enabling scale across their enterprises.

To my fellow shareholders,

In 2023, we continued to make progress against our three-year strategy for growth, portfolio rationalization and capital allocation as we outlined in our March 2023 Investor Briefing. We achieved strong year-over-year growth in the total contract value of new business sales, the highest in company history, and we continued to be recognized for our strong culture.

Despite macroeconomic uncertainty, we achieved strong momentum in our business development pipeline. As part of our plan to streamline our portfolio and become a nimbler company, we announced two divestitures and launched a share buyback plan. We also achieved multiple client wins and introduced new technology solutions in key focus areas while earning continued recognition for our solutions.

Looking ahead, our unwavering focus is to deliver better outcomes through improved performance, experience and value for our clients by streamlining operations, reducing cost, elevating end-user experiences and enabling scale across their enterprises. We will continue our efforts across three core dimensions: Growth, Efficiency, and Quality.

Continued to deliver for our clients

Our focus on client-first routines and operational excellence carried through in 2023. We continued to improve SLA performance for our clients and maintained record-high system availability. This helped us expand business and win notable awards from clients. We also enhanced our data analytics, AI and machine learning capabilities to deliver for our clients and their end users.

Enhanced our portfolio of solutions

In 2023, we also brought new solutions to the marketplace. We became the first BPS provider to offer the U.S. Federal Reserve's FedNow Service for instant payments​and introduced our Rapid Assistance Solution which expedites delivery of funds to those in need after a crisis. On the commercial side, we announced our FastCap® Finance Analytics technology platform that uncovers hidden working capital quickly and our Conduent CXNow Solution which incorporates AI capabilities with rapid deployment and easy scalability. We also launched our IntelliHealth solution with analytics, AI and machine learning to help pharma companies enable hyper-personalized, omnichannel engagement with healthcare professionals and our AI-driven Provider Data Management solution for health plans.

Attracted new business

We attracted marquee new logo clients and expanded capabilities with existing clients. We won new business to provide customer experience management solutions to Virgin Atlantic, extending our capabilities to the airline and its passengers. We were selected by the State of Victoria, Australia, to provide their next-generation smartcard solution, representing the largest TCV win in company history. Additionally, we were awarded a contract with New Mexico for a new Medicaid Management Information System and launched an exciting partnership with Schwab Retirement Plan Services to expand capabilities for benefit plan offerings for clients​.

Optimized our portfolio

In 2023, we began rationalizing our portfolio to become a leaner, more nimble company. The sale of our BenefitWallet business was the first step in this process, a deal set to close in multiple tranches in 2024. We also entered into an agreement to sell our Curbside Management and Public Safety Solutions businesses. We expect that the impacts of our portfolio rationalization, combined with planned 2025 actions, will result in a more agile, focused and higher growth company with less capital intensity. We remain on a path to achieve this and will continue to provide updates along the journey.

Earned industry recognition

We're proud that our commitment to client success and differentiated solutions has earned industry accolades. We were named a Leader in the 2023 ISG Provider LensTM for Customer Experience Services for the third consecutive year and, in the HR space, we were recognized as both a Leader in Cloud HR Transformation and Benefits Administration by NelsonHall.

In addition, we were named a Leader in Healthcare Payer Operational Transformation by NelsonHall and maintained a Leader Ranking in Everest Group's Healthcare Payer Operations PEAK Matrix®Assessment.

In the public sector, we received CiTTi Award honors for our work in the sustainable movement of people and goods. And for the third consecutive year, we were named to the GovTech 100 list for our work with U.S. state and local agencies.

Enhanced our strong culture

Helping our clients solve complex business challenges requires supporting our associates and creating an open and inclusive environment. In 2023, we were named to Newsweek's "Top

100 Global Most Loved Workplaces" and Comparably honored Conduent with its "Best Leadership Team" award, among others. We earned the highest possible score by Disability Equality Index and are proud to have their "Best Place to Work for Disability Inclusion" honor. We also earned a "Best for Vets" employer designation from Military Times. And for the third consecutive year, we were named a "Best Employer for Diversity" by Forbes.

Progressing ahead

We operate in a competitive market environment, competing for new business or new talent in our workforce. Whether it is financial progress, culture improvements, industry recognition or stronger client relationships, we have made significant strides on our journey. The foundation is built, and the next level of achievement is on the horizon.

I want to thank each of our 59,000 associates who worked hard in 2023 to improve our performance in this competitive environment. I'm proud of what we accomplished and even more excited for what lies ahead in elevating client outcomes and solving some of their biggest challenges.

Cliff Skelton

President and Chief Executive Officer Conduent Incorporated

CONDUENT 2023 ANNUAL REPORT | 1

Maximizing value for clients

Conduent's solutions, services and people touch millions of lives all over the world, every day. Our foundation is built on a commitment to our clients and their end users - focused on delivering better outcomes through driving performance, enhancing experiences and creating value.

We're dedicated to creating safer roads and journeys, streamlining business processes, helping constituents in need and personalizing customer experiences, to name a few. Our award-winning solutions and services help organizations around the globe navigate complex challenges and improve end-user experiences every day.

Our Businesses

Commercial

Improving customer experiences and business process efficiencies

Government

Powering public sector service delivery and constituent-centered goals

Transportation

Creating smarter, safer journeys across the transportation ecosystem

• Customer Experience Management
• Business Operations Solutions
• Healthcare Claims and Administration
• Payments and Child Support
• Eligibility and Enrollment
• Government Healthcare Solutions
• Road Usage Charging
• Transit
• Public Safety and Curbside Management

2 | CONDUENT 2023 ANNUAL REPORT

Recognitions

In 2023, we were proud to receive industry accolades for our innovative solutions as well as recognition for our leading workplace culture.

Industry recognition

ISG Provider Lens Leader in

Customer Experience Services

ISG Provider Lens Global

Rising Star for Finance and

Accounting Outsourcing

Services - P2P

Everest Group PEAK Leader in

Healthcare Payer Operations

Culture recognition

Forbes Best Employers for Diversity

Newsweek Top 100 Global Most Loved Workplaces for 2023

Disability Equality Index

Best Place to Work for

Disability Inclusion

NelsonHall NEAT Leader in Cloud HR Transformation

NelsonHall NEAT Leader in

Healthcare Payer Operational

Transformation

GovTech 100 Company

Comparably Best Leadership Team Award

Military Times Best for Vets Employers

CONDUENT 2023 ANNUAL REPORT | 3

Board of Directors

Scott Letier

Chairman of the Board

Conduent Incorporated

Managing Director

Deason Capital Services, LLC

Cliff Skelton

President and Chief Executive Officer Conduent Incorporated

Hunter Gary

Senior Managing Director

Icahn Enterprises L.P.

Kathy Higgins Victor

President and Chief Executive Officer Centera Corporation

Jesse A. Lynn

General Counsel

Icahn Enterprises L.P.

Steven Miller

Portfolio Manager

Icahn Capital LP

Michael Montelongo

President and Chief Executive Officer GRC Advisory Services, LLC

Margarita Paláu-Hernández

Founder and Chief Executive Officer

Hernández Ventures

Shareholder Information

For investor information, including comprehensive earnings releases and this Annual Report, visit investor.conduent.com or contact Investor Relations at [e-mail]

For ESG inquiries, email [e-mail]

Shareholder Services

Computershare at 866.574.5496

Computershare Investor Services

P.O. Box 43078

Providence, RI 02940-3078

www.computershare.com/investor

Annual Meeting

Friday, May 17, 2024, 9:30 a.m., EDT

The Annual Meeting will be conducted virtually, via a live audio webcast. Access details will be provided via Proxy materials, which will be mailed on April 3, 2024, to shareholders of record as of March 18, 2024.

Electronic Delivery Enrollment

Conduent offers shareholders the convenience of electronic delivery, including:

• Immediate receipt of the Proxy Statement and Annual Report
• Online Proxy voting

Registered Shareholders, visit:

www.envisionreports.com/CNDT

Registered shareholders can sign up for future electronic delivery on that site. You are a registered shareholder if your shares are being held by our transfer agent, Computershare.

4 | CONDUENT 2023 ANNUAL REPORT

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________________

FORM 10-K

_________________________________________________

(Mark One)

• ANNUAL1934 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF

For the fiscal year ended: December 31, 2023

• TRANSITION1934 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF

For the transition period from: _______ to: _______

Commission File Number 001-37817

_________________________________________________

CONDUENT INCORPORATED

(Exact Name of Registrant as specified in its charter)

_________________________________________________
New York	81-2983623
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
100 Campus Drive, Suite 200, Florham Park, New Jersey	07932
(Address of principal executive offices)	(Zip Code)
[phone]
(Registrant's telephone number, including area code)
_________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CNDT	NASDAQ Global Select Market

Securities registered pursuant to Section 12(g) of the Act: None

_________________________________________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by a check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Small reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes- Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ý

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive- based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).o

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

The aggregate market value of the voting and non-voting common stock of the registrant held by non-affiliates as of June 30, 2023 was $730,085,550.

Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest

practicable		date:
Class		Outstanding at January 31, 2024
Common Stock, $0.01 par value	209,974,904

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this Form 10-K incorporates by reference certain portions of the Registrant's Notice of 2024 Annual Meeting of Shareholders and Proxy Statement (to be filed with the Securities and Exchange Commission pursuant to Regulation 14A no later than 120 days after the close of the fiscal year covered by this report on Form 10-K).

FORWARD-LOOKING STATEMENTS

From time to time, we and our representatives may provide information, whether orally or in writing, including certain statements in this Annual Report on Form 10-K (the "Form 10-K"), and in any exhibits to this Form 10-K, which are deemed to be "forward-looking" as defined in the Private Securities Litigation Reform Act of 1995 (the "Litigation Reform Act"). These forward-looking statements and other information are based on our beliefs as well as assumptions made by us using information currently available.

The words "anticipate," "believe," "estimate," "expect," "plan," "intend," "will," "aim," "should," "could," "forecast," "target," "may," "continue to," "endeavor," "if," "growing," "projected," "potential," "likely," "see ahead," "further," "going forward," "on the horizon" and similar expressions (including the negative and plural forms of such words and phrases), as they relate to us, are intended to identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These statements reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions, many of which are outside of our control, that could cause actual results to differ materially from those expected or implied by such forward-looking statements and could materially adversely affect our business, financial condition, results of operations, cash flows and liquidity.

Important factors and uncertainties that could cause our actual results to differ materially from those in our forward- looking statements include, but are not limited to: government appropriations and termination rights contained in our government contracts; the competitiveness of the markets in which we operate and our ability to renew commercial and government contracts, including contracts awarded through competitive bidding processes; our ability to recover capital and other investments in connection with our contracts; risk and impact of geopolitical events and increasing geopolitical tensions (such as the wars in the Ukraine and Israel), macroeconomic conditions, natural disasters and other factors in a particular country or region on our workforce, customers and vendors; our reliance on third-party providers; our ability to deliver on our contractual obligations properly and on time; changes in interest in outsourced business process services; claims of infringement of third-party intellectual property rights; our ability to estimate the scope of work or the costs of performance in our contracts; the loss of key senior management and our ability to attract and retain necessary technical personnel and qualified subcontractors; our failure to develop new service offerings and protect our intellectual property rights; our ability to modernize our information technology infrastructure and consolidate data centers; expectations relating to environmental, social and governance considerations; utilization of our stock repurchase program; the failure to comply with laws relating to individually identifiable information and personal health information; the failure to comply with laws relating to processing certain financial transactions, including payment card transactions and debit or credit card transactions; breaches of our information systems or security systems or any service interruptions; our ability to comply with data security standards; developments in various contingent liabilities that are not reflected on our balance sheet, including those arising as a result of being involved in a variety of claims, lawsuits, investigations and proceedings; risks related to divestitures and acquisitions; risk and impact of potential goodwill and other asset impairments; our significant indebtedness and the terms of such indebtedness; our failure to obtain or maintain a satisfactory credit rating and financial performance; our ability to obtain adequate pricing for our services and to improve our cost structure; our ability to collect our receivables, including those for unbilled services; a decline in revenues from, or a loss of, or a reduction in business from or failure of significant clients; fluctuations in our non-recurring revenue; increases in the cost of voice and data services or significant interruptions in such services; our ability to receive dividends and other payments from our subsidiaries; and other factors that are set forth in the "Risk Factors" section, the "Legal Proceedings" section, the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section and other sections of this Form 10-K, as well as in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission (the "SEC"). Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether because of new information, subsequent events or otherwise, except as required by law.

CONDUENT 2023 ANNUAL REPORT | 1

CONDUENT INCORPORATED

FORM 10-K

December 31, 2023

TABLE OF CONTENTS

Part I

Item 1.	Business
Item 1A.	Risk Factors
Item 1B.	Unresolved Staff Comments
Item 1C.	Cybersecurity Matters
Item 2.	Properties
Item 3.	Legal Proceedings
Item 4.	Mine Safety Disclosures
Part II
Item 5.	Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer
	Purchases of Equity Securities
Item 6.	[RESERVED]
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of
	Operations
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk
Item 8.	Financial Statements and Supplementary Data
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial
	Disclosure
Item 9A.	Controls and Procedures
Item 9B.	Other Information
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
Part III
Item 10.	Directors, Executive Officers and Corporate Governance
Item 11.	Executive Compensation
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related
	Stockholder Matters
Item 13.	Certain Relationships, Related Transactions and Director Independence
Item 14.	Principal Accountant Fees and Services

Part IV

Item 15. Exhibits and Financial Statement Schedules

Item 16. Form 10-K Summary

Exhibit Index

Signatures

Page

3

15

27

27

28

29

29

30

31

32

48

49

92

92

93

93

93

93

94

94

94

94

95

96

98

2 | CONDUENT 2023 ANNUAL REPORT