UPDATE: Lexmark Posts Stronger-Than-Expected Q3 Earnings

Lexmark International

reported better-than-expected profit for the third quarter. The Lexington, Kentucky-based company posted a quarterly profit of $37.9 million, or $0.60 per share, versus a year-ago profit of $34 million, or $0.53 per share. Excluding certain items, its adjusted earnings came in at $1.05 per share. Its revenue rose to $918.1 million from $890 million in the period, while non-GAAP revenue climbed to $921 million from $896 million. However, analysts were expecting earnings of $0.92 per share on revenue of $889.62 million. Lexmark's Managed Print Services and Perceptive Software combined revenue jumped 20% to $291 million, while Imaging Solutions and Services revenue came in almost flat at $835 million. Hardware revenue surged 8% to $196 million, while Supplies revenue slipped 2% to $593 million. Gross profit margin narrowed to 38.9% from 39.1%. Operating expense widened to $303 million from $287 million, while operating income fell to $55 million from $61 million. Paul Rooke, Lexmark chairman and chief executive officer said, "Our strong results reflect the work we have been doing to transform Lexmark to a solutions company, creating a unique portfolio of higher value imaging and software solutions.” For the current quarter, Lexmark projects earnings of $1.10 to $1.20 per share, versus analysts' estimates of $1.20 per share. It projects full-year earnings of $4.05 to $4.15 per share, versus estimates of $4.00 per share. Lexmark shares declined 2.96% to close at $39.63 yesterday.