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Mar 31, 2020
Xerox Q1 2020 Earnings Report
Xerox's first-quarter results were released, showing a decrease in revenue and earnings per share due to the impact of COVID-19.
Key Takeaways
Xerox Holdings Corporation reported a decrease in revenue by 14.7 percent year-over-year to $1.86 billion and a GAAP loss from continuing operations of $(0.03) per share. The company withdrew its 2020 financial guidance due to economic uncertainty caused by COVID-19.
Operating cash flow from continuing operations was $173 million, down $49 million year-over-year.
Free cash flow was $150 million, down $57 million year-over-year.
Adjusted operating margin was 4.7 percent, down 630 basis points year-over-year.
Adjusted earnings per share (EPS) was $0.21, down $0.45 year-over-year.
Xerox
Xerox
Xerox Revenue by Segment
Revenue by Segment
Equipment Sales Revenue
CapyFin.comPost Sale Revenue
CapyFin.com Forward Guidance
The company is withdrawing its 2020 financial guidance for revenue, adjusted operating margin, EPS and free cash flow due to the high level of economic uncertainty and disruption caused by COVID-19.
Positive Outlook
- Strong balance sheet
- Sufficient liquidity
- Access to undrawn $1.8 billion revolver
- Receivables securitization
- Access to capital markets
Challenges Ahead
- Greatest impact to revenues from business closures expected during the second quarter.
- Sales are expected to decline significantly as businesses hold off or delay purchases during the closure period.
- Variable charges are impacted by our customers' employees not being in the office and using our equipment due to current lock-down restrictions.
- Uncertainty around the duration and economic impact of the crisis.
- Difficult to predict the full impact on our business operations and financial performance.
Revenue & Expenses
Visualization of income flow from segment revenue to net income