XRX Xerox Holdings Corporation

Xerox Corp.'s profit fell 85% in the first quarter, dinged by higher restructuring charges, as its business remained challenged ahead of its planned separation.

Xerox also said Monday it expects adjusted earnings of 24 cents to 26 cents a share in the current quarter, compared with analysts' expectations of 26 cents, according to Thomson Reuters. And while the company backed its adjusted full-year earnings outlook, it cut its reported 2016 view to 45 cents to 55 cents a share, compared with prior guidance of 66 to 76 cents. The company, which also lowered its cash-flow forecasts, said the moves reflected separation and higher restructuring-related costs.

In the quarter reported Monday, the company's restructuring costs jumped to $126 million from $14 million, eating into profit.

Chief Executive Ursula Burns said in prepared remarks that the company had accelerated its cost-cutting efforts amid declining revenue in the document technology segment, which she said had been pressured in the quarter with weak developing markets. Ms. Burns said the company expects to reap the benefits of those cuts in the second quarter.

In January, Xerox said it would split into two companies: one with 40,000 workers that sells office machines and one with 104,000 workers that provides back-office services.

Both units at the Norwalk, Conn.-based company have been struggling to grow. In the latest quarter, revenue in the company's services business rose 1%, or 2% on a constant-currency basis, to $2.5 billion. Sales in its legacy hardware division dropped 10%, or 9% on constant-currency, to $1.6 billion.

Xerox, synonymous with paper copiers and printers, has been transforming its business as sales of its signature products have declined amid an increasingly digital workplace. But expanding into areas that include document management and bill processing hasn't been smooth, with Xerox posting a recent run of quarters with declining revenue.

The company said Monday its separation was on track to be completed by the end of the year.

Over all for the period ended March 31, Xerox logged a profit of $34 million, or three cents a share, down from $225 million, or 19 cents a share, in the year-ago period. Excluding certain items, such as restructuring related charges, the company posted earnings on a per-share basis of 22 cents.

The company had guided for per-share earnings between 21 cents and 24 cents, and analysts had projected 23 cents.

Revenue fell 4% to $4.28 billion. Analysts had projected $4.24 billion.

Shares in Xerox are down 6.8% from a year ago, but have risen 23% in the past three months. The stock was inactive premarket.

The company backed its full-year adjusted earnings view of $1.10 to $1.20 a share. Analysts expect $1.11 cents.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

(END) Dow Jones Newswires

April 25, 2016 08:15 ET (12:15 GMT)

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