Xerox (XRX) reports loss during first-quarter on legal settlement

Posted Apr 18th 2008 9:35AM by Eliza Popescu
Filed under: Earnings Reports, Consumer Experience, Xerox Corp (XRX)

The market looks to be poised for a positive opening this morning, and so does Xerox Corp. (NYSE: XRX). The company's shares have been trading higher despite posting a first-quarter loss as its adjusted earnings matched analysts' estimates.

Xerox, the leading provider of digital printers and document management services, reported this morning that it swung to a loss of $244 million, or 27 cents per share, hurt by a litigation charge that overshadowed strong sales growth. Included in the office equipment maker's earnings figures were 54 cents related to that lawsuit settlement. Excluding that, Xerox would have posted quarterly earnings of 27 cents, in line with analysts' predictions.

Xerox also announced a 13% growth in its quarterly sales, which climbed up to $4.34 billion from $3.84 billion a year earlier. Analysts had expected revenue of $4.24 billion, according to Thomson Financial.

The company's litigation charge of $491 million was tied to its action designed to cover the costs of a 2000 class-action lawsuit claiming that Xerox misled investors about its financial health. However, the world's largest maker of high-speed color printers did not admit any financial trickery and preferred to settle to save time and money.

For the past year, the company's stock price has been facing tough times as continued worries over a possible recession, the slumping housing market and soaring fuel prices brought a slowdown in consumer spending. However, with today's earnings numbers investors show some enthusiasm and pushed the stock up 1.03% in early trading.

Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.

Tags: earnings, featured, inthenews, lawsuit settlement, LawsuitSettlement, printers, Xerox, xrx