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Xerox reports 3rd quarter earnings; profits hurt by tax changes

Oct 23, 2018

Xerox is reporting 3rd quarter earnings which saw profits drop, partly due to higher taxes.

The company’s net profits were $89 million, down from $179 million a year ago. Earnings per share, after adjusted for certain one-time charges, were 85-cents per share, which beat Wall Street estimates.

But revenues dropped 5.8 percent to just over $2.35 billion, and came in a bit lower than Wall Street expected.

CEO John Visentin, who took over this past spring,  that, “We are progressing on our priorities, which include optimizing our operations for greater simplicity, re-energizing our innovation engine and focusing on cash flow to drive increasing shareholder returns. Work remains on the priority to drive revenue. Actions are underway to streamline the organizational structure, expand our channel presence, and further differentiate our products and services to provide greater value to customers.”

Xerox says it reduced employee headcount in the 3rd quarter worldwide by 900 employees. There was no immediate word how that impacted Rochester operations.

This was the first full quarter under the new management for Xerox backed by activist investors Carl Icahn and Darwin Deason.

They helped scuttle a proposed merger deal that would have seen Fuji take majority control. Recently a New York State Appellate Court found that Xerox’s former CEO Jeff Jacobson did not mislead  the company’s board of directors when that deal was originally proposed.

During a conference call with investors on Tuesday, Visentin indicated that he didn't think that appellate court ruling would have much impact on the decision to end the merger deal with Fuji, since it involved other objections to that plan.

“We don’t believe it means very much for Xerox, because Xerox terminated that transaction for reasons unrelated to the injunction," Visentin told analysts on Tuesday.