UPDATE: Xerox Posts Upbeat Q2 Earnings, Lifts Low End of FY14 Earnings Forecast

Xerox

reported better-than-expected second-quarter earnings and raised the lower end of its full-year earnings forecast. Xerox expects Q3 adjusted earnings of $0.25 to $0.27 per share, versus analysts' estimates of $0.26 per share. Its now projects full-year adjusted earnings of $1.09 to $1.13 per share. The Norwalk, Connecticut-based company reported a quarterly profit of $266 million, versus a year-ago profit of $271 million. Its per-share earnings climbed to $0.22 from $0.21 per share. The year-ago quarter results included a loss of $0.02 per share related to discontinued operations. Excluding certain items, it earned $0.27 per share in the recent quarter. Xerox in April expected adjusted earnings of $0.25 to $0.27 per share. Its revenue declined 1.8% to $5.29 billion from $5.39 billion. However, analysts were expecting earnings of $0.26 per share on revenue of $5.31 billion. Xerox's revenue from services business surged around 2% to $3.00 billion, while revenue from document-technology business slipped around 6% to $2.1 billion. During the second quarter, Xerox generated $325 million in cash flow from operations. Its operating margin rose 0.3 points of 9.7%, while gross margin came in at 30.8%. Ursula Burns, Xerox chairman and chief executive officer said, “The second quarter demonstrates progress in executing on our strategy. In our Services business, revenue growth and margin are trending well in commercial services, document outsourcing and internationally.” Xerox shares fell 2.10% to $12.57 in pre-market trading.