Xerox Corporation (NYSE:XRX) posted a 10 percent increase in its first quarter profits to $296 million or 23 cents, mainly due to a lighter tax bill. The printer and copier pioneer had earned $269 million, or 19 cents per share in the same period of 2012. However, total sales declined 2.7 percent to $5.36 billion, missing the consensus estimate of $5.6 billion.
Falling demand of copiers and printers continues to affect the company’s revenues. Revenues from printing business declined 8.7 percent to $2.1 billion, while services unit posted 3.5 percent increase in revenues to $2.9 billion. Xerox Corporation (NYSE:XRX) said that the company is on the right track to meet its full-year earnings estimate of $1.09 to $1.15 per share. The company said its income tax expenses shrank 32 percent to $52 million in the first quarter.
Xerox Corporation (NYSE:XRX) has been working to restructure itself. The company is shifting its focus from the declining printing business to services like bill processing, document management and IT outsourcing, but the transition has been a bit bumpy so far. Its printing unit still makes up for about 40 percent of its revenues. Printing business is declining world over as more and more customers access their documents on smartphones and computers. The company expects to generate about two-thirds of its revenues from services division by 2017.
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For the second quarter, the Norwalk, Connecticut-based company said it expects 23-25 cents in earnings. Analysts polled by Thompson Reuters were expecting 26 cents in Q2 earnings. Downbeat guidance for the second quarter comes after two of its rivals, International Business Machines Corp. (NYSE:IBM) and Accenture Plc (NYSE:ACN) indicated weaker demand, especially in Europe. Last week, International Business Machines Corp. (NYSE:IBM) announced its first quarter results that fell short of analysts’ expectations.
Xerox Corporation (NYSE:XRX) last month hired Kathryn Mikells as its chief financial officer. Mikells earlier served as the CFO of ADT Corp (NYSE:ADT). Xerox Corporation (NYSE:XRX) shares were up 26 percent this year through yesterday. Shares were up 0.58 percent to $8.65 in early market trading.