Xerox has reported its earning for the first quarter of this year, which show a slight downturn in revenue at $5.1 billion, two percent lower than the first quarter of last year. Revenue from the company’s Services business, which represented 57 percent of total revenue, was $2.9 billion, flat year over year, while the revenue from the company’s Document Technology business, which is 40 percent of total revenue, was $2.0 billion, down four percent, or five percent in constant currency.
First-quarter operating margin of 8.6 percent improved 1.1 points year over year. Gross margin was 30.2 percent, and selling, administrative and general expenses were 18.8 percent of revenue. Xerox generated $286 million in cash flow from operations during the first quarter and repurchased $275 million in its own stock. Ursula Burns, Xerox chairman and chief executive officer says that the company will repurchase between $500 million to at least $700 million, adding: “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.”
However, Xerox has had higher than expected costs in its healthcare business and consequently is lowering its guidance for both full-year Services segment margin and 2014 earnings. The company expects full-year 2014 GAAP earnings per share of 90 to 96 cents and full-year adjusted EPS of $1.07 to $1.13.