Xerox Posts Wider Net Loss as Revenue Falls 13%
Xerox Corp. said Tuesday that its third-quarter net loss widened to $211 million, or 29 cents a share, but company executives remain cautiously optimistic about returning to profitability in the next quarter for the first time in more than a year.
The printer and copier company’s year-earlier loss was $191million, or 30 cents a share.
Revenue fell 13% to $3.9 billion from $4.5 billion a year earlier, hurt by the weak economy and the Sept. 11 attacks. The attacks hurt sales during what is traditionally one of the strongest weeks of the quarter for the company.
Excluding one-time gains and losses, the latest third-quarter loss was $175 million, or 24 cents a share. That matched the recently lowered consensus estimate of analysts surveyed by Thomson Financial/First Call.
The consensus estimate for the third quarter had been a loss of 12 cents a share until Xerox warned earlier this month that its loss would be greater.
Shares of Xerox fell 2 cents to close at $7.30 in New York Stock Exchange trading.
The Stamford, Conn.-based company has been struggling to return to profitability by implementing a turnaround plan announced a year ago that includes cutting about 11,000 positions worldwide through early retirement, voluntary leave, attrition and layoffs.
Anne M. Mulcahy, Xerox president and chief executive, said she is hopeful that Xerox can return to profitability in the fourth quarter.
“However, the uncertainty in the marketplace presents significant challenges and will lessen the sequential increase in fourth-quarter revenue,” she said.
The weak economy will make that task more difficult, said Jonathan Rosenzweig, an analyst with Salomon Smith Barney in New York. He’s predicting Xerox will break even in the fourth quarter.
In other technology earnings news Tuesday:
* Amazon.com Inc.’s third-quarter loss narrowed to $169.9 million, or 46 cents a share, as the biggest Internet retailer cut costs at its warehouses. A year earlier, Seattle-based Amazon lost $240.5 million, or 68 cents a share. Sales were flat at $639.3 million. Revenue from books, music and video--the company’s biggest and oldest lines of business--dropped 12% because of the slowing economy, a slump in sales the week of Sept. 11 and the Web site’s promotion of used books and music.
* AT&T; Wireless Services Inc., the No.3 U.S. mobile-phone company, said third-quarter profit rose almost fourfold as it added 748,000 customers, excluding those from affiliates in smaller markets. Net income rose to $77 million, or 3 cents a share, from $21 million, or a loss of 1 cent after preferred dividends, a year earlier. The company was expected to have a loss of 2 cents, according to a survey of analysts by Thomson Financial/First Call. Sales rose 25% to $3.5 billion.
* CNet Networks Inc., which owns Web sites focused on technology, posted a third-quarter loss of $1.37 billion, or $9.98 a share, after writing down the value of businesses it acquired by $1.08 billion. The recent loss of $9.98 a share ballooned from a year-earlier loss of $43.6 million, or 50 cents a share. Revenue rose 23% to $69.3 million.
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* Earthlink Inc., the third-largest Internet service provider, said its third-quarter loss widened to $77 million, or 62 cents a share, on higher acquisition expenses. The Atlanta-based company posted a loss of $72.5 million, or 65 cents, a year earlier. Sales rose 28% to $319million, largely because the company gained subscribers and raised its monthly rate.
* EMachines Inc., the Irvine-based low-cost PC maker, posted a net loss of $8.1 million, or 5 cents a share, for the third quarter, much narrower than its loss of $18.1 million, or 12 cents a share, a year earlier. The nation’s third-largest vendor of desktop PCs in retail stores saw its sales drop 47% to $93.3 million, partly as a result of a planned inventory reduction following extensive discounts and incentives. The company also improved its cash reserves, to $191.3 million from $112.9 million a year earlier, providing a better cushion to ride out difficult times.
