Xerox Corp. (XRX) lowered its earnings outlook for the year on
Friday amid strengthening currency headwinds and softer signings,
while also offering a weak outlook for its current quarter.
For the year, Xerox now expects adjusted earnings of 95 cents to
$1.01 a share, down from its previous forecast for $1 to $1.06 a
share. It expects revenue, stripping out currency fluctuations, to
fall 1%, while it had previously forecast revenue would be flat for
the year.
For its current quarter, Xerox forecast per-share earnings of 21
cents to 23 cents. Analysts polled by Thomson Reuters recently had
expected 25 cents a share in earnings.
Long known for its paper copiers and printers, Xerox has been
working to transition into a company focused on document
management, bill processing and IT outsourcing services. Xerox
recently acquired Consilience Software, a health-care
case-management software provider used by government agencies.
But the transformation has come with its share of challenges,
including falling sales of printers and copiers and the significant
costs of expanding its services business. The company also has
struggled with currency volatility, particularly the weakening of
the euro.
For the first quarter ended March 31, Xerox reported a profit of
$225 million, or 19 cents a share, compared with a profit of $281
million, or 23 cents a share, a year ago. Excluding special items,
earnings were 21 cents a share.
Xerox had forecast 20 cents to 22 cents a share in earnings.
Revenue fell 6.3% to $4.47 billion, below the $4.56 billion
analysts had forecast.
Revenue from the company's services business, which represented
56% of revenue, fell 3% to $2.5 billion.
Revenue from Xerox's document-technology business declined 10%
to $1.8 billion.
Write to Chelsey Dulaney at Chelsey.Dulaney@Wsj.com
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