Lexmark to cut jobs after quarterly results

July 22, 2015

Lexmark new logoThe OEM is reportedly set to cut four percent of its workforce after mixed quarterly results.

Both Reuters and the OEM reported on its 2Q2015 results, which showcase costs “resulting from recent acquisitions as part of efforts to focus on software and services”. Reuters stated that the OEM will cut 500 jobs, or “about four percent” of its workforce, in order to “offset costs” created by acquisitions in the last few months, and Lexmark CEO Paul Rooke told the news outlet that “we are very much not a printer maker anymore. We are very much a solutions company”.

The OEM has acquired around 14 other companies in the last five years, but says it “expects no real M&A activity over the next 18 months”, with the last acquisition that of customer management software developer Kofax in May earlier this year. Reuters pointed out that Lexmark, along with competitors HP and Xerox, are “pushing into high-value software and services business[es] as companies reduce printing to cut costs and consumers shift to mobile devices”.

Lexmark itself reported that revenue was boosted by “strong Enterprise Software performance”, while combined Enterprise Software and MPS units grew by 37 percent, making up 40 percent of total revenue. GAAP (generally-accepted accounting principles) revenue came in at $879 million (€805 million), a fall from $892 million (€817 million) in 2014, while profit margin grew to 41.2 percent from 39.4 percent, and the fall in revenue was blamed on the company’s 2015 “restructuring”.

In non-GAAP segment revenue, the Imaging Solutions and Services (ISS) unit saw revenue fall by 11 percent, while MPS revenue grew four percent. Non-MPS revenue fell by 12 percent, while inkjet exit revenue from the OEM’s decision to leave the market fell by 48 percent. Enterprise Software revenue reached $139 million (€127 million), a growth of 136 percent thanks to the Kofax acquisition, and the OEM also announced its plans for restructuring to generate savings of $65 million (€59 million).

These plans include the job cuts, which will take place over the next 18 months and affect workers worldwide in administration, marketing and development roles within the ISS unit, with around a third of positions “being shifted to low-cost countries”. The OEM’s forecast for the next quarter was also revealed, and said to be “well below expectations” according to Reuters, with revenue expected to rise in 3Q2015 and in the whole year by between “-1 to +1 percent”, though Cross Research Analyst Shannon Cross stated that the restructuring “was expected … It sounds like they are trying to position 2016 as a recovery year”.

Rooke added: “Lexmark delivered strong growth in Higher Value Solutions revenue, which is comprised of Enterprise Software and Managed Print Services. Despite the ongoing headwinds from the strong US dollar and near-term laser supplies channel optimisation particularly in EMEA, overall Lexmark delivered a good quarter.”

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Lexmark reveals new MPS programme

June 30, 2015

The OEM’s Advantage MPS Core Programme is aimed at channel partners.lexmarkweb

The Advantage MPS Core Programme is designed for channel partners to “expand their customer reach” and “provide their customers with all of the cost and efficiency benefits” that an MPS programme can deliver, “while removing investment and fleet management banners associated with selling and then implementing MPS solutions”. The new programme is designed to give resellers “the tools and knowledge” to sell MPS “without having to invest in MPS operations and service infrastructure”.

Lexmark quotes market researchers Quocirca, who stated that “first time adoption of MPS in Europe will grow throughout 2015” to the point at which more than 50 percent of SMEs will have “some form of MPS”. By “enabl[ing] its channel partners to benefit from this trend”, the OEM states that it will make it “easy and affordable to get started in MPS”, adding that this all builds on its 15 years’ experience of “deploying MPS to large enterprise businesses”.

Partners signing up to the programme will have “immediate access” to both training and resources “to help them market the advantages”, while Lexmark will “proactively manage supplies fulfilment, maintenance and support of contract devices”, allowing partners to “maintain and build relationship[s] with their customers”. The “specific channel programme” will allow partners, the OEM adds, to “expand their customer base with new offerings at minimal risk”.

Martin Fairman, Channel Sales Director for UK and Ireland at Lexmark, stated: “As Lexmark continues to evolve into an end-to-end solutions provider it is imperative that channel partners understand how to join us on this journey. The Advantage MPS Core Programme is one of these opportunities. MPS Core provides resellers with a robust framework in which to maintain their client interactions while enhancing the products and services they offer.

“Gartner recognises Lexmark as a leader in MPS. Our vast experience in delivering successful MPS solutions gives us a great deal of insight into the benefits that such services deliver to businesses. Our channel partners require a high level of investment in terms of cost and time to be able to offer such solutions. Our new Lexmark Advantage MPS Core Programme addresses this head-on. Lexmark does all of the heavy lifting so that our partners can focus on providing their customers with efficient and cost-effective print management.”

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Lexmark launches new content capture software

June 29, 2015

The Perceptive Checklist Capture solution will allow users to “capture content with the device at hand” from printers.

Lexmark's campus in Lexington, Kentucky

Lexmark’s campus in Lexington, Kentucky

The new solution from Lexmark “automates the process of gathering related documents and data” from computers, mobile devices or MFPs, which is said to help with the capture process and free workers to “focus on customer service and compliance”. The software is also said to enable users to “capture content with the device at hand […] to get the job done in the moment, wherever they are”.

The software also removes manual intervention and “improves accuracy by reducing the rate of misfiled or misclassified content”, with users able to “immediately add” content to folders or projects whether they are “in the field” or in the office. The interface for this is “similar across all devices and platforms, for a consistent and unified experience”.

The Perceptive Checklist Capture service also “updates the project or case folder in real-time”, and notifies users when “a document is missing or incomplete”, sending information “directly to the user’s core business system” and in a “central repository for speedy retrieval”. Lexmark added that the service can be “leveraged in virtually every industry”, as it “organises unstructured data, simplifies deployment and expansion, complements existing core systems, and demonstrates compliance”.

Brian Anderson, Chief Technology Officer for Lexmark Enterprise Software, stated: “Perceptive Checklist Capture is an example of Lexmark’s enterprise content management vision and strategy coming to fruition – mobile, desktop (web) and smart MFP devices all working together to capture, manage and access unstructured data at the moment it’s needed.”

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Lexmark attends latest Static Control seminar

June 4, 2015

The seminar in Athens, Greece saw over 30 customers attend, while Lexmark’s Head of Government Affairs for the EMEA gave a presentation on clone cartridges.static greece seminar

The latest seminar hosted by the largest manufacturer of aftermarket imaging systems took place on 20 May in Athens, Greece, with around 30 customers attending. The event’s programme included technical demonstrations from Customer Support Technician Alejandro Casillas on “how to remanufacture three different cartridges”, including the Lexmark CS/CX series, the HP 3525 and the HP M551.

Other elements of the seminar included “the recent launch of Static Control’s inkjet range of products and cartridges”, a section “dedicated to troubleshooting and fault-finding in remanufactured colour cartridges”, and the talk from Maxime Furkel, Lexmark International’s Head of Government Affairs for the EMEA. Furkel’s presentation, entitled Clone Toner Cartridges – an OEM Perspective, discussed the “need to educate customers on the legal, social, economic and environmental issues surrounding this subject”.

Printerland’s Nektarios Ntagkas, who attended the event, stated: “This seminar was a step in the right direction regarding the value that we all have to place on our industry. It was also a chance to draw on Static Control’s years of experience to get our questions answered, view invaluable technical demonstrations and gain some direction in how to grow our business within this market. How many companies can you locally meet with and hear the perspective of an OEM? This gave us all the opportunity to learn a lot from Maxime Furkel from Lexmark.”

Javier Gesualdo, Static Control’s Regional Sales Manager for Southern Europe, commented: “For Static Control, the most important aspect of today, and in fact all events in the seminar calendar, is the demonstration of support. It is not enough to tell remanufacturers that we support them; in coming to Athens, we are bringing our customers new commercial and technical tools to help them rethink the best ways to grow their businesses.”

Static Control added that it “respects the IP of OEMs and works diligently to provide its customers with the safest aftermarket solutions available”, and added that “for this reason, Static Control was proud for the show of support from Lexmark on this occasion”.

The seminars are free of charge to Static Control customers, and future events are planned in Rome, Minsk, Fatima and Madrid during June, before “phase two” of the seminars commences in September. The Recycler attended the seminar in Budapest, Hungary, which you can read about in issue 271, while the first event of 2015 took place in Albania in February.

Other 2015 seminars took place in Germany and Georgia as well as Paris, France, with details on further seminars available on the company’s event’s page at The Recycler reported on the free seminars hosted by Static Control last year, including events in Croatia and Serbia, Italy, Latvia, France, Romania, Poland and Greece. The original programme was announced in March last year, and was expanded in September.

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Lexmark signs MPS deal with Australian bank

May 26, 2015

PrintThe OEM has signed a four-year deal with the Bank of Queensland (BOQ), and will provide business assessments, infrastructure and process optimisation to the company.

Herald Sun reported on the agreement, under which the bank will also receive asset management services, a maintenance and onsite valet service, as well as “software solutions, reporting and governance”.

The bank hopes to save two million pages per year with the new deal, as it implements the Lexmark Print Management solution throughout its corporate offices. It will similarly deploy the OEM’s services at its ‘BOQ’ Village’ head office in Brisbane.

Steve Sherwood, BOQ’s Head of Distributed Computing, said: “BOQ is pleased to have engaged Lexmark to deliver our group-wide managed print service and we’re excited by the opportunities this offers to our corporate businesses and importantly BOQ’s unique owner manager branch network.

“In addition to reducing costs and relieving the IT department of the day-to-day operations, Lexmark’s in-depth knowledge of the banking industry has enabled us to identify further business process improvement opportunities.”

Arjan Paulussen, General Manager for Australia and New Zealand at Lexmark International, said: “We look forward to helping BOQ further improve the quality of service they can provide to their customers over the term of the contract.”


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Lexmark launches new document solution

May 14, 2015

The Perceptive Checklist Capture is said to “streamlin[e] the capture process” from mobile devices and printers.Lexmark new logo

The OEM announced the Perceptive Checklist Capture technology, which “enables users to capture content with the device at hand” – whether it be a mobile device or MFP – to “get the job done in the moment”. The solution allows for workers to remove manual steps and “improves accuracy” through reducing “the rate of misfiled or misclassified content”.

In terms of MFPs, the technology allows users to scan documents on the device, then “immediately add them to a project or case folder”, or take a photo on a mobile device and do the same. The interface on different platforms is “similar” and allows for a “consistent and unified experience”, according to Lexmark. Users are also notified if documents are “missing or incomplete”, and folders are updated “in real-time”.

The technology is aimed at “virtually any industry” including retail, government, banking, insurance, manufacturing and education. Lexmark added that the software “organises unstructured data, simplifies deployment and expansion, complements existing core systems, and demonstrates compliance”.

Brian Anderson, Chief Technology Officer at Lexmark Enterprise Software, commented: “Perceptive Checklist Capture is an example of Lexmark’s enterprise content management vision and strategy coming to fruition – mobile, desktop (web) and smart MFP devices all working together to capture, manage and access unstructured data at the moment it’s needed.”

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Lexmark joins global circular economy platform

May 7, 2015

The OEM has become a member of the Ellen MacArthur Foundation’s Circular Economy 100, which “brings together innovative businesses to address the issues around Lexmark new logothe transition to the circular economy”.

The global platform was created to “support companies as they seek to unlock the commercial opportunities” from “designing products for reuse, new or enhanced recovery models and the introduction of new business models that promote greater circularity”. The OEM added that the programme “was founded on the principle that more value can be gained through collaborative working than can be achieved alone”.

Lexmark claims that it has an “ongoing engagement with the circular economy”, citing its Lexmark Cartridge Collection Programme (LCCP) – which provides customers with “easy methods to return their used laser supplies” – alongside free collection services “in more than 60 countries”. It also claims that it has been able to “dramatically increase the use of post-consumer recycled content in its toner cartridge[s]”, particularly through the Corporate Cartridge range, launched last year.

Jean-Charles Guinot, Business Programme Associate of the Ellen MacArthur Foundation, stated: “Research by the Ellen MacArthur Foundation has highlighted a combined annual trillion dollar opportunity globally in net material cost savings for companies making the transition to circular economy. We are really pleased that Lexmark has agreed to join our industry partnership platform and share and explore the application of the circular economy approach with other forward-thinking global businesses.”

Sylvie Thomas, Head of Corporate Social Responsibility at Lexmark EMEA, added: “Lexmark is committed to being a good corporate citizen and our business practices are guided by the principles of resource efficiency and the circular economy. Working with the Ellen MacArthur Foundation and being part of a group of 100 like-minded businesses that are all seeking to promote the obvious benefits of the circularity will help to maintain and improve our own approach to how we incorporate circular economy practices throughout our business.”

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Lexmark’s 1Q2015 results published

April 29, 2015

Lexmark new logoThe OEM saw revenues fall, with imaging products in particular seeing a three percent decline.

The OEM delivered GAAP revenue of $852 million (€773 million) compared with $878 million (€797 million) in 2014, achieving a gross profit margin of 38.7 percent, down from last year’s figure of 38.9 percent.

The non-GAAP figures had $855 million (€776 million), down from $881 million (€800 million) for the previous year. Last year’s core revenue of $807 million (€733 million) remained constant, but with six percent growth at constant currency, while gross profit margin was measured at 40.5 percent, down from 41 percent for 2014. The company registered an adjusted EBITDA of $123 million (€111 million), compared to $137 million (€124 million) for the previous year.

Looking more specifically at the revenues, Imaging Solutions and Services declined three percent year-to-year to $766 million (€695 million); MPS’ $185 million (€168 million) revenue grew three percent year-to-year; non-MPS’ revenue, recorded at $533 million (€484 million), dropped six percent year-to-year.

Meanwhile, inkjet exit revenue sat at $48 million (€43 million), falling by 34 percent; enterprise software revenue, excluding adjustments, was $90 million (€81 million), growing 40 percent year-to-year. Higher Value Solutions revenue grew 13 percent year-on-year, making up 32 percent of total revenue, an increase of 28 percent for the same period in 2014 .Lexmark saw a five percent increase in annuity revenue for the trailing four quarters, at $2.419 billion (€2.197 billion), comprising 70 percent of core revenue.

For 1Q2015, the OEM anticipates constant year-on-year core revenue and that total revenue to decline between two to four percent year on year. Lexmark predicts that for 2015 as a whole core revenue will decline slightly year on year, and total revenue will drop between three to five percent year-on-year.

Paul Rooke, Lexmark’s Chairman and CEO, said: “Despite a strong currency headwind, Lexmark delivered revenue and EPS at the top of our January guidance range. Double-digit revenue growth in Higher Value Solutions is another clear indication that our transformation strategy is working.

“Our annuity revenue represents approximately 70 percent of core revenue, fueling Lexmark’s ability to invest in growing our Higher Value Solutions capabilities while also returning capital to shareholders through dividends and share repurchases.”

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Lexmark US case ruling will have industry impact

April 16, 2015

The case between Lexmark and US remanufacturer Impression Products moved to a panel hearing in the US Court of Appeals for the Federal Circuit, with the eventual 2000px-US-CourtOfAppeals-FederalCircuit-Seal.svgruling set to significantly affect the US remanufacturing industry.

The legal case began when Impression Products was named in an IP infringement case in October 2013 in the US District Court Southern District of Ohio (Cincinnati Division). The case referred to the “unlawful importation […] the sale for importation and/or the sale within the United States after importation” of a number of infringing remanufactured and cloned aftermarket cartridges.

Impression’s legal team moved to dismiss claims as well as overturn the Jazz Photo decision that impacts on patent exhaustion, or the “first-sale doctrine”. This was also influenced by the Supreme Court’s ruling in the Kirtsaeng case in 2013, which prevented copyright owners from stopping imports and reselling content sold abroad.

Impression’s case with Lexmark went to the appeals circuit, with Lexmark opposing a ruling that it had exhausted patent rights in its Prebate programme. Impression Products meanwhile wished to overturn a ruling that it had infringed Lexmark’s patents relating to remanufactured cartridges that used empties from outside the USA.

Now, Patently-O has featured a piece written by Dennis Crouch, Law Professor at the University of Missouri School of Law, which outlines the implications. The case is heading for an en banc hearing, which means that a full panel of judges will decide whether to overturn either Jazz Photo or Mallinckrodt, another decision addressing an “unrestricted first sale”.

Impression argued that Lexmark’s overseas sales “precluded” it from suing for infringement of US patents if the cartridges were “imported, remanufactured or resold” in the USA, acknowledging that this contradicts Jazz Photo which holds “a foreign sale does not exhaust US patent rights”. However, it believes that Jazz Photo had been “implicitly overruled” by the Kirtsaeng decision, with the District Court disagreeing.

What Impression Products is seeking is for both rulings to be overturned, as the removal of Jazz Photo would mean companies selling remanufactured cartridges in the USA could use empties from across the world, rather than needing to prove first-use in the USA. The removal of Mallinckrodt would mean Lexmark would have exhausted patent rights in the Prebate cartridge return programme – the centre of cases between it and Static Control.

This would mean that while Lexmark disagreed with the previous rulings in its cases with Static Control, a Federal Circuit decision would be legally binding. However, if Lexmark was to win the case then Jazz Photo would remain with little change to the present situation, but if Mallinckrodt remained in law, then Lexmark may have more options to file IP infringement suits pertaining to Prebate cartridges.

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Lexmark launches new branding

April 7, 2015

Lexmark new logoThe OEM’s new feature image “reflects both the evolution of the company as well as its vision for the future,” it has said.

The MPS provider stated that its rebranding shows “its successful and ongoing transition to a company well beyond its hardware heritage” as it “evokes the clarity, value and durability of the traditional Lexmark diamond, evolving to an aperture, which represents the broader offering – a portal to insight, a means of focus”.

It continued: “The green palette is fresh, vibrant and approachable, representing Lexmark’s strength, focus on sustainability and growth as well as our commitment to earning “customers for life.”

Lexmark has also issued a new tagline: “Open the possibilities”, which it claims “invites customers to engage with Lexmark to open up greater opportunities for success with our broader technology and solutions portfolio”.

Chairman and CEO Paul Rooke said: “This new brand and logo reflect our enthusiasm and focus on connecting our customers’ information silos and automating business processes.

“Our brand transformation better represents where the company is today and our vision for the future.”



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