Xerox Posts In-Line Q3 Earnings, But Issues Weak Forecast

Xerox Corp (NYSE: XRX) reported in-line earnings for the second quarter. However, the company issued a weak earnings forecast for the third quarter.The Norwalk, Connecticut-based company reported a quarterly net profit of $12 million, or $0.01 per share, versus a year-ago profit of $266 million, or $0.22 per share. Excluding non-recurring items, the company's adjusted earnings came in at $0.22 per share. Its revenue slipped 7 percent to $4.59 billion. However, analysts were expecting earnings of $0.22 per share on revenue of $4.64 billion. The average estimate among 16 Estimize users was for earnings of $0.24 per share and revenue of $4.64 million.Its services revenue declined 3 percent to $2.6 billion in the quarter, while document technology revenue dropped 12 percent to $1.9 billion.Its operating margin declined 1.6 percentage points year-over-year to 8.2 percent in the quarter.The company ending the quarter with cash balance of $1.6 billion. In the quarter, Xerox repurchased $395 million in stock. For the third quarter, the company projects adjusted earnings of $0.22 to $0.24 per share, versus analysts' estimates of $0.25 per share. For the full year, Xerox expects adjusted earnings at the lower end of its range of $0.95 per share to $1.01 per share.Xerox shares gained 1.07 percent to close at $10.81 yesterday.