Xerox reports revenue drop in Q1 2014
Profit up 14% but document technology division revenues down
Xerox has posted its Q1 2014 results showing a 2% drop in revenue, to $5.1bn, while operating profit rose 13% to $442m.
Some 57% of company revenue was generated by the company's services business, and Xerox CEO and chairman Ursula Burns said that growth of services, particularly outside of the US, is a focus for investment.
Revenue from the document technology division was down 4%, and the company revised its full year EPS forecast downwards as it faces higher than expected costs in implementing platforms for its US government healthcare operations.
"Our first-quarter performance reflects the value of our diversified business. Good profitability in Document Technology along with strength in document outsourcing and in commercial outsourcing services contributed positively to our results," said Burns.
"But these gains were offset by higher-than-anticipated investments in our government healthcare business as we implement new Medicaid and health insurance exchange platforms. We're focused on driving Services growth and margin improvement by executing on our Five-Plank Strategy and expect the benefits to build through 2014."
The company generated $286 million in cash flow from operations during the first quarter. Also during the quarter, the company repurchased $275 million in Xerox stock.
"Our strong cash position enabled a fast start to our share repurchase program, and we are increasing our full-year share repurchase expectations from at least $500 million to at least $700 million. We continue to make investments in expanding services outside of the United States and to build out our services capabilities in areas that provide significant customer value," Burns added.