Xerox Shares Plunge After Q3 Revenue Miss, Reduced FY21 Sales Outlook

Xerox Holdings Corp XRX reported a third-quarter FY21 sales decline of 0.5% year-on-year, to $1.76 billion, missing the analyst consensus of $1.81 billion.
Equipment sales declined 7.6%, while Post sale revenue improved 1.7%.
Sales in the Americas declined 2.2% Y/Y, and EMEA rose 4.6%.
The gross margin contracted 440 basis points Y/Y to 32.4%. The adjusted operating margin shrank 320 basis points to 4.2%, and the adjusted operating income for the quarter declined 43.5% to $74 million.
Xerox held $2.2 billion in cash and equivalents as of September 30, 2021. Operating cash flow amounted to $100 million, and free cash flow totaled $81 million in the quarter.
EPS of $0.48 beat the analyst consensus of $0.44.
Xerox said that the Delta variant caused delays in many of their clients' plans to return employees to the workplace.
The company's board approved an additional $500 million share repurchase program.
Outlook: Xerox reduced FY21 revenue guidance to $7.1 billion in actual currency and $7.0 billion in constant currency, versus the consensus of $7.26 billion.
Price Action: XRX shares are trading lower by 7.54% at $19.02 on the last check Tuesday.

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