Xerox is reporting third quarter earnings Tuesday that beat Wall Street estimates.
The improvement was mainly on the profit side. Xerox earned $221 million in the quarter, and its earnings per share of $1.08 blew past Wall Street estimates of .86 per share.
Sales of $2.2 billion represent a drop of 6.5% from a year ago, (5.3% when currency fluctuations are removed), but that drop was less than analysts had anticipated.
All in all, George Conboy, Chairman of Brighton Securities says this was a positive report for Xerox.
“This is the nicest quarter we’ve seen from Xerox for years; profits higher, profit margins higher, more cash flow, just about everything that Xerox did for the quarter looks better than it did a year ago,” Conboy said.
But Conboy notes sales continue to be a challenge for the company.
“Sales were down about 5 percent…that’s better than it’s been, but it’s still a negative number and so Xerox really has to work hard to get that sales number up. If they can do that this looks like a much better managed company than we would have been talking about a year or two ago,” Conboy noted.
Xerox also announced Tuesday that it has decided not to pursue a sale of its customer financing business, saying that it did receive multiple bids but ultimately decided that retaining and improving the business will generate the greatest return for shareholders.
Xerox Vice Chairman and CEO John Visentin also said the company will raise its guidance for 2019 overall.
“Our strategy and execution delivered a strong third quarter despite industry headwinds. We increased cash flow, earnings per share and adjusted operating margin while we improved the revenue trend. These results give us confidence to raise our earnings and cash flow guidance for the year as we position Xerox for long-term growth,” Visentin said.
