The company has released its third-quarter results, recording a revenue decrease year-on-year of 0.5%.
Xerox recorded revenues of $1.76 billion (€1.51 billion) for the reporting period, down 0.5% year-over-year, essentially staying flat. During the third quarter 2021, Xerox said business continued to be impacted by the COVID-19 pandemic. The prolonged and extensive impact of the Delta variant drove many of its customers to delay their plans to return employees to offices.
As a result, Xerox explained, while it continued to see a correlation between the roll-out of vaccinations, the return of employees to the office, and the gradual recovery of our post sale revenues, the marginal improvement in our page volume-driven post sale revenues was less than previously anticipated.
“Our revenue this quarter was essentially flat year-over-year, despite a deterioration in global supply chain conditions and the Delta variant, which caused delays in many of our clients’ plans to return employees to the workplace,” said Xerox Vice Chairman and CEO John Visentin.
“As a result of these ongoing challenges, we are revising our revenue guidance lower, but we are maintaining our free cash flow guidance of at least $500 million (€430 million). Our focus on generating cash allows us to preserve, and in some cases increase, investments in innovation, while continuing to return more than 50% of free cash to shareholders and pursue M&A.”
In addition, the company has also been impacted by the global supply chain issues, created in part by the COVID-19 pandemic, which have resulted in an unprecedented level of disruption that has led to shortages and transportation delays of our products and third-party IT hardware. This has resulted in lower than anticipated equipment and IT sales for Xerox. Higher transportation and logistics costs and growth of the company’s order backlog at the end of the quarter, as its customers continued to invest in its print technology and services.
Xerox said in its announcement: “We expect the ongoing effects of the COVID-19 pandemic, including the potential emergence of new variants, as well as the global supply chain disruption, to delay economic recovery and continue to affect our revenues and margins into 2022.”
