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1 2017 Annual ReportCreating Intelligent InteractionsConduent Incorporated100 Campus Drive, Suite 200 Florham Park, NJ 07932 2018 Conduent Inc. All rights reserved. Conduent and Conduent Agile Star are trademarks of Conduent Inc. in the United States and/or other countries. Paper from responsible sources. Conduent Inc. 2017 Annual Report2 Letter to Shareholders6 Our Value Chain7 Our Transformation Roadmap8 Overview of Services and Results9 Non-GAAP Measures12 Board of Directors13 Officers and Investor Information Form 10-KFinancial Highlights (dollar values in millions, except EPS) 2017 2016 2015 GAAP revenue $ 6,022 $ 6,408 $ 6,662 Adjusted revenue1 $ 6,022 $ 6,491 $ 6,778 Gross margin gross margin1 $ 615 $ 686 $ 699 Adjusted operating income1 $ 418 $ 354 $ 323 Adjusted operating margin1 loss $ (16) $ (1,227) $ (574)GAAP EPS $ $ ( ) $ ( )

2 Adjusted net income1 $ 186 $ 223 $ 174 Adjusted EPS1 $ $ $ $ 671 $ 526 $ 284 EBITDA margin1 Adjusted EBITDA1 $ 672 $ 635 $ 639 Adjusted EBITDA margin1 Please refer to the Non-GAAP Measures table beginning on page 9 for the reconciliation of this financial measure that is not in compliance with Generally Accepted Accounting Principles (GAAP).IntroductionConduent is a partner to many of the Fortune 100 and governments across the world. Our role is to manage essential aspects of our clients operations while interacting with and supporting the people our clients serve. We manage millions of digital interactions every day, 24x7, with patients, employees, customers and citizens.

3 And with each interaction, we aim to deliver an experience that is seamless, secure, personalized and compliant. Conduent Inc. 2017 Annual Report 12 Ashok VemuriChief Executive OfficerTo my fellow shareholders Conduent Inc. 2017 Annual Report 3 The aggressive internal changes we made through the year fueled strong financial performance in 2017. Becoming a Single Company One of our key goals during our first year was to evolve from the complex fragmented conglomerate that we had inherited into a single, unified company with a common vision, purpose and culture. We consolidated more than 50 brands under Conduent addressing every possible touchpoint from systems to software to real estate.

4 More importantly, we tackled the most important determinant of our success our culture. Developed during the last year, our Conduent Culture System describes our unique vision, mission, ambition and values, all of which will shape the way we engage our various stakeholders and the way we work within the StrategyIn order to return our company to growth, we needed to remake our client coverage model and go-to-market approach. Conduent is advantaged with an impressive client list, serving many of the Fortune 100 and every state in the Expanding our service line penetration in the highest opportunity market segments and clients is a key organic growth driver.

5 This required many changes in our selling engine. We verticalized our go-to-market model for an industry-based selling approach. We reset and aligned sales roles and compensation with our growth objectives. Deal review and approvals were standardized in support of targeted economics, tenor and technology content. Upon reviewing our entire account portfolio, we exited thousands of unprofitable or untenable account relationships. Overall, these actions created much higher focus on our selling engine for sharper value creation, delivery excellence and, ultimately, financial contribution. It is with a sense of pride and optimism that I write my second annual letter to you.

6 2017 was a year of great change and accomplishment for our new company, and we enter our second year on track against our game plan to build a profitable, predictable and sustainable growth-oriented enterprise. Our successful first year required aggressive changes across almost every dimension of the company. In addition to covering our financial performance, I will also summarize the progress we ve made in our evolution from many disassociated businesses to a unified, more efficient and higher performing company. Financial PerformanceOur financial results in 2017 position us well for the next stage of our growth plan.

7 We achieved or exceeded our goals on all key financial metrics and enter 2018 with the confidence that we are on the right path to generate profitable growth in our core businesses. Revenue declined 6% year-over-year, in line with expectations. Approximately 50% of this decline was driven by strategic actions on our non-core portfolio as we redefined our company around a select, core set of businesses in line with our new business strategy. We grew adjusted EBITDA 6% as a result of a range of actions. We remediated troubled contracts, and we exited unprofitable relationships and low-priority geographies.

8 This work, combined with a higher focus on cash management, generated more than $200 million of adjusted free cash flow from operations. We ended the year with a stronger balance sheet and improved capacity for future investments back into the business. An Effective Cost StructureA by-product of our previous, fragmented model was an inefficient cost structure and operating model, hampering both profitability and market responsiveness . We aggressively drove the strategic transformation initiative that we began prior to our spin-off and over-achieved our cost savings targets during our first year as Conduent.

9 Real estate and IT were sizable sources of cost savings. In 2017, we closed more than 120 facilities and plan to close up to 100 additional locations. We overhauled our IT structure end-to-end, consolidating labor, partners, data centers and networks. We also launched a multi-year modernization program that will result in greater efficiency and best-in-class systems over time. Leveraging Technology Conduent is a technology-led, platform-enabled company; our technology and platform solutions support more than two-thirds of our revenue. Technology is central to our growth and go-to-market strategy. As we refocused our portfolio in 2017, we also conducted a rationalization of our platforms, identifying those that are aligned with our core business.

10 This was the first and critical step toward defining our long-term technology and platform strategy. With this rationalization now complete, we expect to invest $200 million in platform modernization over a three-year period to ensure our platforms are supported with best-of-breed technology. We also made strides in upgrading our technology and tools supporting the way we operate internally. During 2017, we deployed a common set of applications across our internal functional processes, supported with standardized, company-wide performance reporting. New business intelligence tools, analytics and automation improved our operational efficiency and accelerated decision-making as a result of more accessible performance data and a single version of the truth.