The OEM stated that revenue fell seven percent in the quarter, with its Document Technology business’ revenue falling 12 percent.
Xerox Square in Rochester, New York
The results included a total revenue of $4.6 billion (€4.1 billion), which was a seven percent decline year-over-year, while the OEM’s Services business represented 56 percent of the total revenue, with $2.6 billion (€2.3 billion). This itself was a fall of three percent compared to the same period last year, while the Document Technology business’ was $1.9 billion (€1.7 billion), a fall of 12 percent on 2Q2014.
The Services business, which includes the company’s MPS and other offerings, also saw margin fall by 7.5 percent, while the Document Technology business, which consists of the OEM’s printers and other technology, saw margin decline by 12.1 percent. These results contributed to an operating margin of 8.2 percent in the quarter, a 1.6 percent fall on 2014, while the company generated $349 million (€318 million) in cash flow in the quarter for a total cash balance of $1.6 billion (€1.4 billion).
In more detail, the Document Technology segment saw equipment sales fall by 10 percent, which Xerox blamed on “lower sales of entry products, particularly in Eurasia and other developing market countries”. It also noted that high-end product sales increased, which “partially offset” the declines, while a “modest decline in total pages” was thanks to “continued migration of customers to our partner print services offering”, and supplies demand was “lower” as well.
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Ursula Burns, Xerox’ Chairman and CEO, stated: “We delivered adjusted earnings in line with our guidance, met our Services and Document Technology margin expectations and delivered solid operating cash flow of $349 million in the quarter. We are intensely focused on improving our Services margin and are implementing restructuring actions and prioritising investments to accelerate benefits from our new operating model.”