NORWALK, Conn. – Xerox Holdings Corporation (NASDAQ: XRX) today reported earnings for the first quarter of 2024 that fell short of Wall Street’s expectations. Xerox shares fell 3.71% after earnings and revenue missed expectations.
The company posted adjusted earnings per share (EPS) of $0.06, significantly below analysts’ consensus of $0.35. Revenue also decreased, coming in at $1.5 billion, against the expectation of $1.53 billion.
The company’s revenue decreased by 12.4% compared to the same quarter last year, reflecting a downward trend in constant currency terms. GAAP net loss was $113 million, or -$0.94 per share, a significant decrease from the prior year’s earnings of $71 million, or $0.43 per share. Adjusted net income decreased $71 million, or $0.43 per share, compared to the previous year.
Xerox’s adjusted operating margin fell to 2.2%, a decrease of 470 basis points from the previous year. There were significant declines in both operating cash flow and free cash flow; Operating cash flow decreased by $157 million and free cash flow decreased by $159 million compared to the previous year.
Xerox CEO Steve Bandrowczak acknowledged the disappointing results but expressed confidence in the company’s strategic changes and the team’s ability to meet future goals. “While first-quarter results fell short of our expectations, I remain confident that we have the right team and the right strategy to realize the Reinvention of Xerox and achieve our adjusted operating income goals,” Bandrowczak said.
Looking ahead, Xerox projects a revenue decline of 3% to 5% in constant currency for 2024 and an adjusted operating margin of at least 7.5%. The company also expects to generate at least $600 million in free cash flow.