Company: CNDT
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001677703-25-000152
Chunk: 65

Company: CONDUENT Inc
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 1
Chunk 65
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2024 were not material.

Income Taxes 

The effective tax rate for the three months ended September 30, 2025 was (19.5)%, compared to 22.2% for the three months ended September 30, 2024. The September 30, 2025 rate was lower than the U.S. statutory rate of 21%, due primarily to valuation allowances and geographic mix of income.

The effective tax rate for the three months ended September 30, 2024 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes, geographic mix of income, and other discrete tax items, partially offset by a favorable permanent difference on gains from divestitures.

CNDT Q3 2025 Form 10-Q27

Excluding the impact of amortization, restructuring, divestiture, valuation allowances and discrete tax items, the normalized effective tax rate for the three months ended September 30, 2025 was 44.7%. The normalized effective tax rate for the three months ended September 30, 2024 was 12.5%, due primarily to excluding the impact of gain from divestitures, restructuring costs, amortization of intangibles, valuation allowance release and other discrete tax adjustments.

The effective tax rate for the nine months ended September 30, 2025 was (3.4)%, compared to 25.2% for the nine months ended September 30, 2024. The September 30, 2025 rate was lower than the U.S. statutory rate of 21%, primarily due to valuation allowances and geographic mix of income.

The effective tax rate for the nine months ended September 30, 2024 was higher than the U.S. statutory rate of 21%, primarily due to state and local taxes and geographic mix of income, partially offset by a favorable permanent difference on gain from divestitures, tax benefit from valuation allowances and audit settlement reserve releases. 

Excluding the impact of amortization, restructuring, divestiture, reserves for the Direct response costs - cyber event, valuation allowances and discrete tax items, the normalized effective tax rate for the nine months ended September 30, 2025 was 29.0%. The normalized effective tax rate for the nine months ended September 30, 2024 was 19.7%, primarily due to excluding the impact of the gain from divestitures, restructuring costs, amortization of intangible assets, litigation reserve releases, audit settlement reserve