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Sep 30, 2022
Xerox Q3 2022 Earnings Report
Xerox's third-quarter performance in 2022 showed improved revenue trajectory driven by resilient demand amid a challenging macro environment.
Key Takeaways
Xerox's Q3 2022 results revealed a slight revenue decrease of 0.4% year-over-year, totaling $1.75 billion, but an increase of 4.7% in constant currency. GAAP EPS was $(2.48), including a significant goodwill impairment charge, while adjusted EPS reached $0.19. The company lowered its 2022 revenue and free cash flow guidance due to currency effects and supply chain issues.
Revenue totaled $1.75 billion, a decrease of 0.4% year-over-year but an increase of 4.7% in constant currency.
GAAP EPS was $(2.48), which includes an after-tax non-cash goodwill impairment charge of $395 million.
Adjusted EPS was $0.19, down $0.29 year-over-year.
The company lowered 2022 revenue guidance to $7.0B to $7.1B and free cash flow guidance to at least $125 million.
Xerox
Xerox
Forward Guidance
Xerox adjusted its revenue guidance to a range of $7.0 billion to $7.1 billion in actual currency and lowered its free cash flow guidance to at least $125 million.
Challenges Ahead
- Revenue guidance lowered to a range of $7.0 billion to $7.1 billion in actual currency due to the weakening of the Euro and British Pound.
- Free cash flow guidance lowered to at least $125 million due to slower-than-expected supply chain improvements.
- Persistently high rates of inflation negatively affected operating profit.
- Greater-than-expected use of working capital to fund originations growth at FITTLE and inventories.