Xerox Misses Q2 Profit Expectations

Originally published at Market Watch.

Xerox misses profit expectations but beats on revenue, sets $1 billion buyback plan

Xerox reported a second-quarter profit that missed expectations. According to Market Watch, the company said it was setting a new direction with return to its roots as a technology company.

Net income declined to $112 million, or 42 cents a share, from $166 million, or 63 cents a share, in the same period a year ago. Excluding non-recurring items, adjusted earnings per share of 80 cents, below the FactSet consensus of 83 cents. Revenue fell to $2.51 billion from $2.57 billion, topping the FactSet consensus of $2.49 billion.

Chief Executive John Visentin, who has been in the role for two months, said the fact that its business model is underpinned by an annuity cash flow makes it challenging to improve revenue and flow cost savings to the bottom line. Vistentin said the company will take action to improve effectiveness and efficiency of its supply chain and go-to-market channels.

Separately, Xerox authorized a $1 billion share buyback program, with $500 million of repurchases expected in 2018. The stock, which was still inactive in premarket trade, has tumbled 18.6% over the past three months while the S&P 500 SPX, -0.30% has gained 6.7%.