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Xerox Holdings (XRX) Stock Rises 2.6% on Q2 Earnings Beat
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Xerox Holdings Corporation’s (XRX - Free Report) stock has gained 2.6% since the company’s earnings release on Jul 25, in response to the earnings beat.
Adjusted EPS of 44 cents beat the Zacks Consensus Estimate by 33.3% and increased more than 100% year over year. Total revenues of $1.75 billion missed the consensus mark by 1.2% but increased slightly year over year on a reported basis. Revenues increased 0.5% on a constant-currency basis.
Xerox shares have gained 7.1% over the past three months compared with the 1.3% rise of the industry it belongs to.
Xerox Holdings Corporation Price, Consensus and EPS Surprise
Post-sale revenues came in at $1.33 billion, down 3.4% from the prior-year quarter’s figure and missing our estimate of $1.36 billion. Equipment sales grew 14.8% year over year to $420 million, matching our estimate. Equipment sales increased 14.3% and post-sale revenues declined 3.2% year over year on a constant currency basis.
Print and Other segment’s revenues totaled $1.7 billion, up slightly year over year. FITTLE’s revenues totaled $101 million, up 5.2% year over year. Sales revenues totaled $696 million, up 4.3% year over year. Services, maintenance and rental revenues totaled $1 billion, down 1.8% year over year. Financing revenues of $49 million decreased 5.8% year over year.
Operating Performance
Adjusted operating income came in at $107 million, up more than 100% on a year-over-year basis. Adjusted operating margin came in at 6.1%, up 410 basis points year over year.
Key Balance Sheet and Cash Flow Figures
Xerox exited the quarter with a cash and cash equivalent balance of $477 billion compared with $591 million at the end of the prior quarter. The company’s operating cash flow and free cash flow were $95 million and $88 million, respectively, in the quarter.
2023 Guidance
Xerox expects its 2023 revenue growth to be flat to down low-single-digits on a constant currency basis, adjusted operating margin to be between 5.5% and 6%, and free cash flow of at least $600 million.
Recent Earnings Snapshots of Some Service Providers
Omnicom (OMC - Free Report) reported mixed second-quarter 2023 results, wherein the company’s earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
OMC’s earnings of $1.81 per share beat the consensus estimate by 0.6% and increased 7.7% year over year. Total revenues of $3.6 billion lagged the consensus estimate by 0.3% but increased 1.2% year over year.
Equifax (EFX - Free Report) reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
EFX’s adjusted earnings came in at $1.71 per share, beating the consensus mark by 2.4% but declining 18.2% from the year-ago figure. Total revenues of $1.32 billion missed the consensus estimate by 0.4% but matched the year-ago figure on a reported basis.
Interpublic’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
IPG’s adjusted earnings came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis. Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
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Xerox Holdings (XRX) Stock Rises 2.6% on Q2 Earnings Beat
Xerox Holdings Corporation’s (XRX - Free Report) stock has gained 2.6% since the company’s earnings release on Jul 25, in response to the earnings beat.
Adjusted EPS of 44 cents beat the Zacks Consensus Estimate by 33.3% and increased more than 100% year over year. Total revenues of $1.75 billion missed the consensus mark by 1.2% but increased slightly year over year on a reported basis. Revenues increased 0.5% on a constant-currency basis.
Xerox shares have gained 7.1% over the past three months compared with the 1.3% rise of the industry it belongs to.
Xerox Holdings Corporation Price, Consensus and EPS Surprise
Xerox Holdings Corporation price-consensus-eps-surprise-chart | Xerox Holdings Corporation Quote
Revenue Details
Post-sale revenues came in at $1.33 billion, down 3.4% from the prior-year quarter’s figure and missing our estimate of $1.36 billion. Equipment sales grew 14.8% year over year to $420 million, matching our estimate. Equipment sales increased 14.3% and post-sale revenues declined 3.2% year over year on a constant currency basis.
Print and Other segment’s revenues totaled $1.7 billion, up slightly year over year. FITTLE’s revenues totaled $101 million, up 5.2% year over year. Sales revenues totaled $696 million, up 4.3% year over year. Services, maintenance and rental revenues totaled $1 billion, down 1.8% year over year. Financing revenues of $49 million decreased 5.8% year over year.
Operating Performance
Adjusted operating income came in at $107 million, up more than 100% on a year-over-year basis. Adjusted operating margin came in at 6.1%, up 410 basis points year over year.
Key Balance Sheet and Cash Flow Figures
Xerox exited the quarter with a cash and cash equivalent balance of $477 billion compared with $591 million at the end of the prior quarter. The company’s operating cash flow and free cash flow were $95 million and $88 million, respectively, in the quarter.
2023 Guidance
Xerox expects its 2023 revenue growth to be flat to down low-single-digits on a constant currency basis, adjusted operating margin to be between 5.5% and 6%, and free cash flow of at least $600 million.
The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings Snapshots of Some Service Providers
Omnicom (OMC - Free Report) reported mixed second-quarter 2023 results, wherein the company’s earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
OMC’s earnings of $1.81 per share beat the consensus estimate by 0.6% and increased 7.7% year over year. Total revenues of $3.6 billion lagged the consensus estimate by 0.3% but increased 1.2% year over year.
Equifax (EFX - Free Report) reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
EFX’s adjusted earnings came in at $1.71 per share, beating the consensus mark by 2.4% but declining 18.2% from the year-ago figure. Total revenues of $1.32 billion missed the consensus estimate by 0.4% but matched the year-ago figure on a reported basis.
Interpublic’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
IPG’s adjusted earnings came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis. Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.