Good morning, and welcome to the Xerox Corporation First Quarter 2012 Earnings Release Conference Call hosted by Ursula Burns, Chairman of the Board and Chief Executive Officer. She is joined by Luca Maestri, Executive Vice President and Chief Financial Officer. During this call, Xerox executives will refer to slides that are available on the web at www.xerox.com/investor. At the request of Xerox Corporation, today's conference call is being recorded. Other recording and/or rebroadcasting of this call are prohibited without expressed permission of Xerox. [Operator Instructions] During this conference call, Xerox executives will make comments that contain forward-looking statements which, by their nature, address matters that are in the future and are uncertain. Actual future financial results may be materially different than those expressed herein. At this time, I would like to turn the meeting over to Ms. Burns. Ms. Burns, you may begin.

Good morning, and thanks for joining us today. We'll get started on Slide 3 with a review of the strategic imperatives that define our business and align with our financial performance. First, accelerating our Services business, growing it faster by diversifying our offerings; aggressively pursuing opportunities in key growth areas like HR outsourcing, customer care, transportation and health care; and expanding globally. In Q1, revenue from Services grew 10% in constant currency and now represents more than half of our total revenue. Second, maintaining our leadership in Technology. Our Printing business continues to benefit our bottom line and remains core to our business model. We are focusing investments on innovation that drives down the cost of color printing, and we're expanding distribution to extend our reach to small and midsized businesses. We made good progress in Q1 with installs of Xerox products up 7%. According to recent external market share reports, we remain the leader in equipment revenue share for the ninth straight quarter. In fact, we're taking share from competitors, strengthening our leadership position. And third, driving operational excellence across our enterprise. This means adjusting our cost model so we're competitively advantaged and have the financial flexibility to quickly adapt to changing marketplace needs while scaling in key growth areas. During Q1, Services margin pressure was partially offset by a 5% decline in selling, administrative and general expenses. By executing well on these 3 priorities, we're delivering on the fourth, creating value for our shareholders. Doing so by growing revenue, delivering solid earnings and allocating capital in the areas of acquisitions, dividends and share repurchase. So our execution is well aligned with our strategy and is reflected in our performance. But the heavy lifting is in the details. Since acquiring ACS more than 2 years ago, we're making a…

Thank you, Ursula. Good morning, everyone. First, I'll just cover revenue, and of course, we were pleased with the acceleration in Services, and we expect it to continue. Technology was lower but should show decline improvement going forward because Q1 of 2011 represented the most challenging compare of the year for us. As we expected, gross margin was lower, 200 basis points year-over-year. Two main drivers for the decline. First, half of the impact can be attributed to the Services margin compression due to the ramping of a significant number of new contracts, along with a few higher margin contracts running off. Second, the increasing Services mix also drove almost 1 point of decline. The gross margin on our Services business is half that of our Technology segment. So the strong growth in Services has a direct impact on overall gross margin. We continue to drive cost and expense efficiencies with SG&A improvement of 110 basis points, which went to partially offset the gross margin pressure. As a result, operating margin was down 60 basis points. We expect both gross margin and operating margin to improve as we move through the year and, by Q4, expect to see year-over-year improvement. The restructuring of $17 million was $32 million higher year-over-year and is fully reflected in our adjusted results. Adjusted EPS of $0.23 was flat from 2011, with the only adjustment to reported EPS being the amortization of intangibles. Let us move to the segment slides. We have updated the content of these pages to also provide a trend view of our results. Starting with Services, we see a very positive trend on revenue, with 10% growth in Q1 at constant currency. This is driven by the strong signings we have had the past 2 years. The California MMIS deal we…

Thanks, Luca. Let me quickly wrap up so that we can get to your questions. Q1 results were as expected. We have work to do on improving margins while we're scaling services growth through the ramp of new contracts, expanding globally and increasing revenue with existing accounts. In Technology, our focus on competitively advantaged color systems and broader distributions led to strong Q1 install growth and double-digit color mix growth. We're disciplined in managing expenses, giving us the flexibility we need on margins to support our Services growth. We'll see a sequential improvement in margins throughout the year and continued benefits from operational efficiencies. Our guidance on cash remains unchanged as we remain committed to investing in share repurchase throughout the year. For the second quarter we expect adjusted earnings of $0.25 to $0.28 per share. This includes a $0.01 or $0.02 of restructuring, and our full year earnings expectations continue to be an adjusted EPS of $1.12 to $1.18. You've heard me say this before, but it bears repeating. Some companies talk about transformation; we're actually doing it. Our results this quarter and our expectations for the balance of this year reflect the shifts happening in our business. They're all centered on building a sustainably successful enterprise with a healthy annuity stream and significant growth opportunities. We're making progress on every front and I remain impatient to make even more. I'm also confident that we have the right strategy, the competitive strength, the skilled leadership team and the disciplined focus on execution that will deliver more value for you and for all of our stakeholders. With that, I thank you, again, for joining us today. As we get into your questions, I know that you'll want to dive deeper into Services. So this quarter, I asked Lynn Blodgett, the President of Xerox Services, to join us for the Q&A. On occasion, we'll bring in other members of the senior team during our investor webcast. This way, like me, you can appreciate the breadth and the depth of the team that helps me lead this business. Now let's open it up to your questions, and I'll field them and ask Luca and Lynn to chime in as well. Questions?

[Operator Instructions] Your first question comes from the line of Shannon Cross with Cross Research.

I guess my first question, Ursula, is if you could talk just a little bit more about what you're seeing in Europe and perhaps some of the other geographies. I know you mentioned that it was improving a bit, sequentially, but I'm curious as to, on the various segments and that, what you're seeing both, like I said, in Europe and other geos.

All right. So Europe was weak, but we did see modest, light -- modest improvement this quarter, particularly in equipment sales line and clearly in the areas that we're focusing on, color, throughout the spectrum, from small to large. Modest, very modest improvement there. But Southern Europe, weak; the rest of Western Europe, a little bit better than Southern Europe; and the Eastern European nations, which are reported in our Developing Markets Operations, generally stronger than all of the rest of Europe. In North America, we saw a continued trend from the fourth quarter, which was a little bit stronger than throughout the rest of 2011, which is good. So we didn't see any downturn there at all. We did see a little bit of weakness in supplies, primarily driven by timing of pricing increases and OEM sales, that kind of thing, but nothing systemic at all there. DMO, continued strength throughout the regions in DMO. Just about every place that we do business, we're seeing growth as those economies grow. We see SMB everywhere around the world doing better, particularly in our North American operations where we have a particular focus in moving coverage. We're seeing our Global Imaging operations do even well there. By the way, Fuji Xerox is having a good result as well, particularly in China and the Asia-Pac areas that they cover. That's also seeing growth. So I think that -- Services, by the way, one last is Services, in Europe in particular, we're starting to see expansion there, which is very good. It's still a very small portion of our business. But we're signing contracts, and as we go forward and get more traction there, we'll be able to actually call it out to you more specifically. As I told you before, Services in Latin America actually were stronger to start off with, particularly in our transportation segment. So across the world, we didn't see a significant change, except for in Europe, a little bit of pickup from a very depressed level and particularly in equipment sales.

Okay, great. And then, Lynn, since you're joining us, can you give us some of your perspective on Services? What segments you're seeing growth in, what you're hearing from your customers and then perhaps how you're thinking about sort of the margin improvement and how it should sort of progress through the year.

You bet. The areas that we're seeing the most activity in would be in health care, both government and commercial health care, for obvious reasons given the pressures that everybody feels on health care costs. Our customer care area is continuing to grow very strongly. We have some great new tools that we're going to implement there that we think will even make us even stronger in customer care. Financial services is very strong. HR outsourcing, we've really sort of disciplined ourselves, and we're much better at focusing on point solutions. So those things are all helping us to grow strongly in those areas. Transportation, as Ursula mentioned, is very, very strong, and transactional BPO just continues to rock along. It's just a very strong operation. As far as the margins, obviously, the fact that we have as much new business, which we're obviously very excited about, as much new business growth, that is going to put a certain amount of pressure on margins. If you look at the decline in Services this last quarter, about 70% of it was due to new business startup, and half of that was driven by the state of California, and about 30% of it was driven by the fact that we had last year, as you know, lower than we like renewal rates, especially in ITO. So we're seeing some impact from that. The vast majority of the pressure is coming because of new business signings. So we're confident that we're going to see -- we like the new signings, and we'll see nice incremental kind of growth through the year in margins.

Great. And then just my last question for Luca. Can you talk a bit about how we should think about the yen and FX as we go through the year in terms of contribution versus the hedging programs you have in place?

Yes, Shannon. Let me start with the impact on revenue because I think it's important to highlight, also, the effect on revenue. It was a negative 1% in Q1. We expect it to be a negative 2% on revenue during the second quarter because euro was particularly strong last year. But for the full year, we expect currency to be 1 point negative to our growth rate. When you go down to the profit level, directionally, as you know very well, for us, weak yen and strong euro is the best of both worlds. At this point, at the beginning of the year, we had talked about $40 million to $50 million negative for the year when we started the year. Rates had improved marginally. So now with that, you probably -- the impact is $30 million to $40 million for the year, and that's the way you need to think about it. We are fully hedged for the current quarter. We tend to be hedged 60% to 70% for next quarter and then at different levels for the following couple of quarters, again, and so the whole concept of the hedging program is to smooth out the volatility of the exchange. But this is the type of impact that we should be seeing this year, at current rates, of course.

Your next question comes from the line of Richard Gardner with Citigroup.

I'd just like to address the current supplies inventory correction that you talked about. Can you talk about what prompted that and where we are and how comfortable you are, right now, with inventory levels? And just any additional color would be helpful.

Yes, we are really thrilled with the activity levels that we saw in the quarter. They were up 7% in particular, and the entry level was up 9%, which definitely fuels the supplies revenue. I'll turn it over to Luca to talk a little bit more about the supplies revenue details.

Yes. So last year we had some fairly significant price increases at this time of the year, and so we were facing a very significant compare year-over-year. Obviously, this is a revenue stream that is very affected by the levels of inventory in our channel partners. I think that the decline in Q1 will not be repeated going forward. What we think is that supplies revenues are going to be closer to flat for the rest of the year, and so I think we're going to work through this issue starting from Q2, Rich.

Yes, Rich, if I can add. I wouldn't read a whole lot into this correction. If you followed us, which you have for a long time, you'll see, depending on the timing of pricing changes by us or our competitors, you'll see ups and downs. It's a fairly lumpy revenue line for us, so you'll see ups and downs. We're seeing great activity, great installs through all of our channels partners, through all of the lines that we get to the market through. So the expectation is that with those equipment sales, there will be supply improvements. So I would not read a whole lot into this correction.

Okay. And if I could follow-up quickly. I believe the restructuring charge on the Technology side was smaller than you talked about previously. Correct me if I'm wrong, but could you talk about why that's the case? And I think, Ursula, you had suggested that there's potential for Technology margins, operating margins, to actually be up this year for a variety of reasons, and I'd just love to get your latest thoughts on that.

Turn it over to Luca…

Yes, so the restructuring charge may be a shade below what we thought at the beginning of the quarter, but we still see a lot of good opportunities across the enterprise. So in the guidance that we give you now for the second quarter, again, we're talking about additional opportunities for restructuring. It's just, I think, a timing issue. Nothing more than that. On the operating margin side, as we said, we believe that from this point, we're going to start seeing sequential improvement year-over-year, both in Services and in Technology. And that will take us to a point in Q4 where we're going to have, we believe, good year-over-year improvement. When you do the math, we think operating margins should be flat to slightly up for the year, but with some level of revenue growth, of course.

If I could just add one last point. Since we will see higher equipment sale revenue in Q2, the margins for the Technology business will be a little pressured. As you know, the margins on our supplies are significantly higher than the margins on our equipment. But at the end of the day, it'll all balance out in the year. So it's literally just a timing issue. So nothing more there.

Your next question comes from the line of Ben Reitzes with Barclays Capital.

Could you just talk a little bit more about Services margins? What are you specifically doing to get them up? And what kind of trajectory should we see going from the 9.3? How quickly -- it sounds like you need to be well into the 12s by the end of the year to hit your numbers. Is that right? And what you specifically doing to get there? And how does the margin play out sequentially? Just for that line.

Yes, I'll have Luca like walk you through it, and then maybe Lynn could add something, some color needed.

So, yes, 9.3 for Q1. We see the expense sequentially, Ben, as we go through the year and getting into an improvement, a very significant improvement, year-over-year in Q4. Really, the reason is clearly the fact that we are ramping a lot of new business all at the same time. Very large contracts, State of California, that's a big example. And also the fact that we are ramping off some of higher margin contracts, particularly in ITO, some of the losses that we had last year. We essentially follow these contracts, and I'll let Lynn expand on it, but we follow all these contracts at the granular level, so each one of them. And we got specific actions for all of them, starting from California, but all the other big ones that we're starting now. I think it's just going to be the way that we go through the year, that some of those pressures are going to mitigate as we actually get these contracts to a steady state.

Yes, the natural thing that happens to a contract, whether it's in start-up mode or through its life, is that the margins continue to improve. And so as the contracts that we have, the big things that hit us in terms of margin pressure, those things will continue to mature, and their margins naturally improve. So you're going to see a natural, in fact, a progression in margins because the contracts that we're currently focused on are going through that life. We haven't seen anything that is unusual as far as the kind of start-up costs that we're seeing. We are doing a number of things we think to continue to drive margin improvement. We have some tools that we've developed. We have a product called Simplicity [ph] that will help us a great deal in our customer care area, and we are shifting a lot of our work to platforms. Our new MMIS platform that was a significant investment is the kind of thing that will help drive higher margins. And of course, as Ursula said, we're just focused on operational excellence. That's our daily bread and butter. So we have to never take our eye off that ball.

If I can just add, to wrap this one up. Losses, this is a place we actually have a lower renewal opportunities -- set of renewal opportunities in the quarter, actually, and throughout the year is actually good news for us. So there's less chances that we can actually lose a contract. But even on the contracts that are up, all the contracts that are up for renewal, we are on them, meaning executives are engaged, the operational managers are engaged and we're engaged with the leaders of the other companies we're doing business with, to assure that they know that we're paying attention to this. So I think you heard that we are focused on the normal operation of the business. We're focused on contract renewals. We're focused on tools to simplify the business, and we've modeled this out, and we're pretty confident that we'll be able to see the margin expansion, very confident that we'll see the margin expansion throughout the year with a high point in margins in the quarter -- at the end of the year, in the fourth quarter. So one of the reasons why we gave you the additional detail on Slide 8. It's a little bit dangerous to put out but we decided to put it out to show we'll continue to fill this in throughout the year, but we'll be able to show you how the margins are improving on a sequential basis.

Your next question comes from the line of Deepak Sitaraman with Crédit Suisse. Deepak Sitaraman - Crédit Suisse AG, Research Division: Ursula, for the full year, can you speak about how you're thinking about the revenue growth outlook? Is there any change to your 2% top line outlook for 2012?

No, we're sticking to the 2%-plus revenue outlook, driven by the mix of business that we saw. High single-digit growth in the Services portfolio, BPO, ITO, Document Outsourcing together and still a little bit of pressure, so flat to slight declines in the Technology business. This is all at constant currency, of course. So we're seeing -- we see that still coming through. Any kind of upside that we do see, we'll actually pass on in future guidance, but we really don't see that changing. High single-digit on Services and flat to marginal declines in the Technology business. Deepak Sitaraman - Crédit Suisse AG, Research Division: Okay, I guess, just to follow-up then, on that high single-digit outlook for Services. Just given the trends that you're seeing in terms of pipeline growth and signings on a trailing 12-month basis, can you speak about the level of visibility you have there?

Yes, I'll have Lynn take it. But I'll summarize before he starts. We have a fair amount of visibility on the revenue side in Services, but go ahead, Lynn.

Yes, the pipeline is, even though we have record, very strong record bookings the last 2 quarters of last year, the pipeline continues to grow. And in fact, it's up 5%, notwithstanding those very strong bookings. So that gives us great visibility in terms of ramp. Growth, right now, is driven by the ramp of signings, primarily the signings that we had last year. One of the great things about this business, because it's so oriented to recurring revenue, is that you can pretty well predict that, if you have a pipeline, it's going to translate into a certain amount of bookings, and then those bookings will contribute very, very predictably to the revenue growth. So we feel really confident in the ongoing revenue growth. Deepak Sitaraman - Crédit Suisse AG, Research Division: Okay, and just maybe the last one for Luca. Luca, you mentioned margins, overall, could be flat to up slightly on a year-over-year basis for the full year. Is that commentary appropriate for just Services margins as well?

I think it's going to be -- yes, overall. But keep in mind that we also have the other segment, which is also helping. So, yes, but pretty close to that.

Your next question comes from the line of Chris Whitmore with Deutsche Bank.

I had a balance sheet question for Luca, specifically around your buyback on a medium- to longer-term basis. You've committed to buying back $1 billion of stock this year. How should we think about that as an ongoing commitment? Should we expect buybacks to continue in 2013, 2014 at this type of scale?

Very clearly, we will have a place for share repurchase on an ongoing basis. As we think about capital allocation, we want it to be well-balanced. Clearly, there is going to be room for dividend and possibly a consideration for the dividend increase as we go forward, and some element of acquisition that is very important to our business model, particularly on the Services side. So we will -- as we get towards the end of the year, we're going to have the Investor Conference in November, we will give you a full debrief on the way we're thinking about capital allocation. Certainly, for the remainder of the year, it's what we mentioned. And clearly, going forward, it will remain. Particularly at this level of the stock valuation, it will remain a very significant element of our capital allocation strategy.

Do you think that the commitment to the buyback is limiting your opportunity set on the M&A side? In other words, do you think you're missing out on opportunities to accelerate the growth of Services given the size of the buyback commitment?

Absolutely not. We have a pipeline, an active fishing and pipeline net out there, and anything that we see that fits into the parameters that we buy, we operate on. So I do not believe -- more than I do not believe, I know that we're not limiting our M&A opportunities because we're buying back shares.

And my last one goes back to the issue around supplies and the recurring elements of the Technology business. I mean, we've been hearing about pretty strong MIF growth for many quarters now, yet that doesn't seem to be translating into the annuity revenue stream, and now we're actually seeing downsides on supplies usage. So can you help me understand the disconnect between past growth and MIF and continued declines on the recurring elements in tech services?

There are 2 primary elements to that. Obviously, there's an element of price erosion that -- it's there, it's in the market and we know that, that causes some pressure on revenue. And the second one is mix. Mix is big as well. We're seeing -- particularly the way we've launched products recently, we've seen very good growth in installs in our entry segment, which obviously carries different levels of pricing. And so I would say those are the 2 reasons from a pricing and mix perspective. And obviously, we've had a macroeconomic environment in Europe which has not helped in that respect.

If I may, Chris, add another piece here. If you think about our business, the way that we’re reporting it today, we report activity to you. That activity is from our Technology business and from our Document Outsourcing business. We just don't -- it makes sense to do it that way. That's the total activity. The revenue splits between the Technology business and the Document Outsourcing business or the Services business. If you were to take into account, in the Technology business, the revenues from the services that we now book in Services, the Technology revenue would have been down 2%. That is almost totally attributable to the weakness that we see in Europe. We offset everything else. Prices up, down; activity, up; colored pages, up; digital pages, we manage all of that in a box that's pretty consistent and in line with what we have said in the past, except for a very significant downturn in business in Europe. So all that Luca said, but you got to actually start to look at the business -- and we try to give you all of this information to look at the business such that you can actually translate activity, which we split into 2 different -- we show in one segment that actually comes from 2 different segments into the rest of the results, revenue, et cetera.

Your next question comes from the line of Ananda Baruah with Brean Murray. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: I guess this one's probably for Luca. Can you give us a sense -- I mean, I guess are we -- on Services operating margins, are we now in the process of moving toward and reaching -- I guess, exiting this s*** [ph] going into next year, steady state in Services operating margins? Or could we see, I guess, some sort of similar dynamic in 2013, where we're still trying to stand up deals and we're not yet reaching steady-state operating margins?

I think we're going to exit 2012 at a level that where we feel it's pretty steady state. So you're going to see some progression during the course of 2012, and then steady state. But you also need to keep in mind -- and I know you know it very well, right? I mean, a lot of what we do is driven by the cadence of new contracts. And so, obviously, if we continue to see the level of revenue acceleration that we see in this year, then obviously, you're going to see some ups and downs in margins. But I would say end of 2012 is going to be pretty much our steady state. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: And then, Luca, what would be the opportunity for Services operating margin expansion in 2013?

Well, of course, on a year-on-year basis, it's going to be obviously significant, right, because we're starting from a relatively low point in Q1. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Yes, I understood that. I guess what I'm wondering is, on a like-for-like basis, December quarter Services margins going forward through '13. What, inside the Services business, could improve the margins?

Well, I think that the -- as I said earlier, the maturing of the contracts. We track very closely each contract. And we know the margins, we know the start-up cost, we compare it against the models that we have built, and occasionally, we have things that we have to focus on more than we expected, and others go a little bit better than we expected. But we're confident that, as we move forward, that natural maturing will occur. The other thing that will happen in the fourth quarter is that we will, essentially, lap this big jump in growth. And that's one of the big reasons that we were confident you're going to see a margin increase. If we can tack another 5% growth on top so we're growing 15%, but you'd see same kind of activity. I guess that would be a really good problem to have. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Yes, got it. I guess I'm just trying to get your thoughts on the opportunity to expand margins, sort of, in 2013 with what's going on with the -- sort of as you see the book of business versus exiting the year.

Yes. The other thing that's happening is that the use of the platforms that we've made significant investments in, the MMIS application that has taken us a long time to build is the first new MMIS system that's been built in 15 years, and it's compliant with all of the new regs and everything. That is a major accomplishment to get that in, and as we put applications or states on that new platform, we'll see improved margins.

The margin pressure for a new add is significantly less than it would have been -- than it was for California.

Ananda, to your question, maybe it's a bit early to start, for us, to start talking about 2013 operating margins at this point. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Okay, fair enough. And just one real quick one. Last one for me. Luca, what should we think about as the gross margin range for this year?

We're guiding 31% to 33%.

We'll see that improve sequentially.

Your next question comes from the line of Keith Bachman with BMO.

To Luca, the first one for you. Could you just confirm that the EPS guidance of $1.12 to $1.18, does that include the actuarial changes associated with the pension, whereby you have significant pension headwinds this year? I think it's $145 million.

All in. Although, Keith, the increase in pension contributions is in that range, in terms of the pension expense, which I think is going to be reflected in the EPS, is in the $40 million -- $40 million to $50 million range. But it's all in, all in.

The second question I have then. Lynn, this is for you. You've talked a lot of confidence in the margins, and yet over the past -- particularly during calendar year '11 on Services, margins did disappoint, and it was fair consistent. And it was driven by, as Ursula said, I think the leakage on ITO. And so, if you could just come back and address, from a management, from a focus, from a systems perspective, what's different now, on the renewals in particular, that did not exist shortly after Xerox bought ACS and fairly consistently during CY '11?

I think the renewal rate in -- particularly in ITO, was disappointing last year. And this not the -- it's not unprecedented that we've seen a point where we've had disappointing renewals in IT. It seems to have -- there are things that drive it, that sometimes we get a little bit behind. This year, because of the focus that we've put on IT renewals specifically, we have much more executive involvement earlier in the process. And as Ursula said, we don't have as many opportunities this year for renewal, which should help us in terms of the renewal rates as well. So more focus. I think just the attention, that's the main thing, and we've seen it before, and that's what we try to do.

Okay. Ursula, one last one for you. Drupa, how should we think about it? Do you think you'll get a little lift of off drupa, either in the June or September quarters? Or is the European backdrop such that we shouldn’t be thinking about it? And that's it for me.

Yes, I don't think that we should be thinking about a specific drupa lift. I mean, if it happens, it -- I actually just don't think it's there. This show is a show of buying, but that buying is generally baked into the normal course of business. Drupa has been going on for years and years and years, and everybody expects what happens at drupa to happen. So drupa for us will be a color show. It will a show that we highlight the advances that we have in color and in solutions wrappers. So not a product show for us but more of a workflow show for us, like how do you put together packaging solutions, et cetera, et cetera. We'll have some new products there, but it won't be a product show, as I said. I don't think that you could bake a whole lot of hope on drupa changing the course of European Technology business.

Your final question comes from the line of Bill Shope with Goldman Sachs.

Ursula, I was wondering if you can walk us through your latest read on the competitive landscape within document outsourcing. All of the key players continue to tout competitive momentum here. So it's a bit tough, for us on the outside, to see which vendors are really breaking out as long-term leaders. So if can give us your perspective on that, that'd be helpful.

Yes, I think it has -- I would speak about 2 companies outside of the other group. So the other group is Canon, Ricoh, KM [Konica Minolta], the normal technology people, technology hardware providers, and they are still infants in document outsourcing. They're really not large players. They are trying to get together solutions and offer them, but we really don't compete actively against them. The places that we -- the competitors that we compete actively against are HP, Lexmark and us. Those are the 3 people who are in this document outsourcing business, today, as mature players. I'll break out HP, of those 3, as behind both Lexmark and Xerox. HP is trying hard to reorganize themselves into having a good set of solutions on the document outsourcing space, but they are lagging for sure. Xerox is ahead. We have not only our Document Outsourcing business, our Managed Print Services play, but the fact that we have a whole set of services that attach to that actually elevates us in the minds of particularly larger customers out there. We have an open platform, one that allows -- and a standard one, meaning open and people understand it. One that allows other people's technologies and other people's workflow and other people's processes to kind of come under the umbrella of us very easily. And we are innovative, so we continue to upgrade what we offer. So HP, behind. The next -- the last 2 are Lexmark and us, and Lexmark is a very specific segment kind of a player. They pick an industry and go after that industry. And the good news about that is that it leaves all the rest of the industries for us to focus on. And we actually continue to actually very, very aggressive against Lexmark in the document outsourcing market. So I think, all in all, if you look at the ratings of Gartner and IDC, if you look at how we're growing this business, 7% revenue growth in the quarter and how that revenue growth positions us from a size perspective, larger than anyone else, you'll see that in document outsourcing we are definitely winning. It's a very competitive market. So we can't take our eye off of it, but we are winning, and we have a gap between our next corporate competitor.

And just as an extension of that, if we just took a snapshot of the environment today. When you go up against HP and Lexmark, where does -- which verticals, types of contracts, does Xerox typically have an advantage? And where do you think you still have some work to do?

Yes, we have strength in the tech sector, in the telecom sector and in banking. I think Lexmark kind of does legal fairly well, and they do some financial fairly well. So we have to -- they're going to try to catch us in the places that we're good, and we're going to definitely try to catch them in the places that they are good. So I think the market is still very wide open, which is the good thing, and the fact that our reputation is very strong here, it's not an easy thing for a customer to do, the fact our reputation is very strong here. And the fact that we're local, and a lot of the growth comes in the x -- what we call partner print services space. We call it XPPS. The fact that we're local and our global imaging partners go out with XPPS, it is really a win for us. They are very intimate with their clients. A lot of the growth is in the not-big segment, and so we're winning there. Our coverage is phenomenal there. So thank you very much, and if there are no more questions, thank you for joining us today, and have a very good summer.

This concludes today's conference call. You may now disconnect.