Xerox Sees Improved Profit, But Flat Or Weak Revenues In FY23 - Update

(RTTNews) - While announcing a profit in its fourth quarter, compared to last year's loss, with increased revenues, Xerox Holdings Corp. (XRX) said on Thursday it expects improved profitability in fiscal 2023, but revenues would be flat or lower than last year in constant currency.

For the full year, the company projects adjusted operating margin of at least 4.7 percent, compared to adjusted operating margin of 3.9 percent in fiscal 2022.

Further, revenue for the year is expected to be flat to down low-single-digits in constant currency. In fiscal 2022, the company's revenues were $7.11 billion.

The company also projects free cash flow of at least $500 million.

Steve Bandrowczak, chief executive officer at Xerox, said, "Resilient demand and improvements in supply chain conditions drove solid Q4 growth in revenue and profits... As macroeconomic uncertainty extends through this year, we will continue working alongside our clients to develop and deploy essential workplace solutions and services, positioning Xerox for long-term growth in profitability."

In the fourth quarter, the company's net income attributable to the company was $121 million, compared to loss of $675 million in the same period last year. Earnings per share were $0.74, compared to loss of $3.97 last year.

Adjusted earnings were $146 million or $0.89 per share for the period, compared to $62 million or $0.34 per share a year ago.

On average, five analysts polled by Thomson Reuters expected earnings of $0.49 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues for the quarter grew 9.2 percent to $1.94 billion from last year's $1.78 billion. At constant currency rates, revenues climbed 14 percent.

Analysts expected revenues of $1.89 billion for the quarter.

In pre-market activity on the Nasdaq, Xerox shares were gaining around 3.4 percent to trade at $18.01.

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