Xerox 1st quarter: earnings off a penny from Wall St. projections, revenues on target

Apr 25, 2017

Xerox is reporting its first full quarter since the company split into two businesses. 

Xerox is now a standalone company focusing on document technology, which makes up the bulk of the Rochester area operations. The business services division is a separate company called Conduent.

This latest quarter for Xerox showed earnings of $16 million, compared to $34 million a year ago; earnings per share came in at 15 cents  a penny under Wall Street estimates, but sales of $2.45 billion were in line with expectations. The company affirmed its full-year projections for 2017.

“I am pleased with our operational results in the first quarter,” said Jeff Jacobson, Xerox chief executive officer. “Revenue and cash flow were in-line with our expectations and, despite currency headwinds, operating margin expanded driven by productivity savings from our Strategic Transformation initiatives.” Jacobson added, “While we still have a lot to do, we laid the foundation to deliver on our full-year commitments.”

Xerox says it also saw some drag on earnings due to accounting issues with its Fuji Xerox joint venture and its operations in New Zealand.

At Brighton Securities, George Conboy says that while profit margins were up, sales were soft.

“This is a company that I think you can expect to find over the next 6, 9 months, 18 months will continue a very strong focus on restructuring to get to a place where they can get sales that will sustain the company because they’re not there yet.”

Xerox has continued to do some restructuring, but there were no new, major layoff programs announced with this earnings report.