On May 21, 2026, the Company, by and through its wholly owned subsidiary Conduent Business Services, LLC (“CBS”), entered into an Equity Interest Purchase Agreement (the “Transit Purchase Agreement”) with Modaxo USA Holdings, Inc. and Modaxo France Holdings SAS (collectively, “Transit Buyer”), and Modaxo Group Inc. Under the Transit Purchase Agreement, CBS agreed to sell all of the issued and outstanding equity interests of Conduent Transport Solutions, Inc. and certain non‑U.S. subsidiaries that comprise the Company’s public transit and fare collection business (the “Transit Business”) on the terms and subject to the conditions set forth therein.

The purchase price is $164 million in cash, subject to customary purchase price adjustments. At closing, Transit Buyer will retain (i) a $10 million purchase price holdback for one year to secure net tangible asset related adjustments and certain indemnification claims, if any, (ii) a $12 million special holdback, the release of which is dependent on certain target completion dates for a customer, and (iii) a $0.4 million holdback for one-year to secure the Company’s portion of the retention amount under Transit Buyer’s representation and warranty policy in the event of breaches of certain representations and warranties, in each case, as further described in the Transit Purchase Agreement. Finally, the Transit Purchase Agreement requires $15 million in cash to be transferred with the Transit Business on the day of closing.

The Transit Purchase Agreement contains customary representations and warranties and pre‑closing covenants for a transaction of this type. The transaction is expected to close before the end of 2026, subject to customary conditions and regulatory approvals.

On June 29, 2026, the Company by and through its wholly owned subsidiary, CBS, entered into an Asset Purchase Agreement (the “Tolling Purchase Agreement”) with Quarterhill Inc., a Canada Business Corporations Act corporation (“Tolling Buyer”). Under the Tolling Purchase Agreement, the Company, by and through certain of its subsidiaries, will sell and assign, and Tolling Buyer will purchase and assume from the Company, certain assets and liabilities of the Company’s tolling solutions business (the “Tolling Business”), on the terms and subject to the conditions set forth therein.

The purchase price consists of $70 million in cash, subject to customary purchase price adjustments, and a number of common shares of Tolling Buyer equal to 7% of the issued and outstanding shares of Tolling Buyer, calculated as of immediately prior to the closing. The estimated market value of these shares, based on the publicly traded market price of Quarterhill Inc. as of June 30, 2026 was $14 million.

The Tolling Purchase Agreement contains customary representations and warranties and pre‑closing covenants for a transaction of this type. The transaction is expected to close before the end of 2026, subject to customary conditions and regulatory approvals.

Collectively, these two pending transactions represent an exit from the Transportation business, a strategic shift that will have a major effect on the Company’s operations and financial results, and as such, qualify for reporting as discontinued operations. Beginning in the second quarter of 2026, the Company reported the results of the Transportation segment, for the periods presented, in the Company's Condensed Consolidated Statements of Income (Loss) as discontinued operations and reported the assets and liabilities of the Transportation segment on the Condensed Consolidated Balance Sheets as held for sale. All prior periods have been reclassified to conform with this presentation. Additionally, the Company has classified the assets and liabilities held for sale as current assets and liabilities as it expects the two transactions will close within one year. The net assets of discontinued operations are recorded at the lower of their carrying amount or estimated fair value less costs to sell.

In the second quarter of 2026, the Company recorded a net pre-tax loss of $31 million related to the pending Tolling divestiture reflecting the write-down of the carrying value of the Tolling Business to its estimated fair value less costs to sell (the "impairment loss"). Any differences due to changes in fair values less costs to sell or carrying values for the Tolling business will be recognized as a gain or loss in future financial statements. There was no tax benefit recorded related to this loss. This loss is included on the Condensed Consolidated Statements of Income (Loss) in Income (loss) from discontinued operations, net of tax and is included in the Condensed Consolidated Statements of Cash Flows as an adjustment in (Gain) loss on divestitures and sales of fixed assets, net.


	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)	2026		2025		2026		2025
Revenue	$	133	$	151	$	269	$	285
Operating Costs and Expenses
Cost of services (excluding depreciation and amortization)	123		128		249		240
Selling, general and administrative (excluding depreciation and amortization)	12		10		25		20

Depreciation and amortization	6		6		12		14



Other (income) expenses, net	37		1		37		(1)
Total Operating Costs and Expenses	178		145		323		273
Income (Loss) Before Income Taxes	(45)		6		(54)		12
Income tax expense (benefit)	2		4		4		5
Net Income (Loss) from Discontinued Operations	$	(47)	$	2	$	(58)	$	7

Other (income) expenses, net shown for the three and six months ended June 30, 2026 in the table above include the $31 million impairment loss noted above. This amount includes approximately $2 million of transaction-related costs that have been accrued within Other current liabilities.

The following is a summary of the major categories of assets and liabilities that have been reclassified as held for sale in connection with the pending Public Transit and Tolling divestitures described above:


(in millions)	June 30, 2026		December 31, 2025
Accounts Receivable, net	$	137	$	159
Other current assets	95		87
Contract assets	55		70
Land, building and equipment, net	17		14
Operating lease right-of-use assets	20		23
Deferred contract costs, net	49		54
Other long-term assets	42		45
Write-down to fair value	(29)		—
Assets of discontinued operations held for sale	$	386	$	452

Accounts payable	$	29	$	34
Accrued compensation and benefits costs	36		37
Contract liabilities	34		30
Other current liabilities	67		70

Operating lease liabilities	15		18
Other long-term liabilities	25		28
Liabilities of discontinued operations held for sale	$	206	$	217


	Six Months Ended June 30,
(in millions)	2026		2025
Non-cash expenses
Depreciation of buildings and equipment	$	2	$	2
Amortization of product software	6		6

Amortization of deferred customer contract costs	4		6
Write-down of assets to estimated fair value less costs to sell	31		—

Capital and other expenditures
Cost of additions to land, buildings and equipment	3		2
Cost of additions to product software	4		1

Costs to obtain and fulfill a contract	—		6