July 26, 2023
The company said that in the second quarter 2023, resilient demand and balanced execution drove another quarter of growth in revenue, profits, and cash flow.
Xerox explained that recent improvements in financial performance are driven by an intense focus on its three strategic priorities, which includes a focus on delivering client success through products and services that address the productivity challenges of today’s hybrid workplace.
Equipment sales revenue of $420 million in the second quarter 2023 increased 14.8% as compared to the prior year period, reflecting stable demand and improved product availability, particularly in the Americas, and for our higher margin A3 devices.
As expected, backlog returned to normalised levels and since we do not expect changes in backlog to materially affect results going forward, we will no longer provide detailed backlog information. Consistent with recent quarters, revenue growth outpaced equipment installations due to favourable mix and pricing.
“Over the last 12 months, Xerox has taken significant steps to strengthen its operating and financial discipline, leading to another quarter of profitable growth amid a dynamic macroeconomic backdrop,” said Steve Bandrowczak, Chief Executive Officer at Xerox. “I’m proud of the part all Xerox employees and partners have played in our continued success. An improved operating system leaves us well positioned to pursue growth opportunities as we focus on meeting clients’ evolving needs in today’s hybrid workplace.”
Post-sale revenue of $1.3 billion in the second quarter 2023 declined 3.4% in actual currency as compared to the prior year period and 3.2% in constant currency. According to Xerox, the decrease was driven primarily by non-contractual items, including lower IT hardware and paper sales, lower finance income and the cessation of Fuji royalties, partially offset by gains and commissions on sales of finance receivables.
Pre-tax loss increased year-over-year driven by a net pre-tax charge of $132 million related to the donation of our Palo Alto Research Centre (PARC), partially offset by continued cost reduction actions, supply chain-related cost improvements and higher revenues.
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