Why Is Xerox (XRX) Stock Down 20% Today?
Xerox (NASDAQ:XRX) stock is heading lower on Tuesday thanks to the release of its earnings report for the third quarter of 2022.
With that Q3 release comes adjusted earnings per share of 19 cents. That’s not what investors wanted to see; Wall Street had estimated adjusted EPS of 40 cents for the quarter. It also doesn’t help that this EPS is lower than the 29 cents per share reported in the same period last year.
Making matters worse for XRX stock today is revenue of $1.75 billion. That’s another miss compared to the $1.77 billion analysts had hoped for as well as a slight drop from the $1.76 billion reported in Q3 2021.
Steve Bandrowczak, CEO of Xerox, said the following in the earnings report:
“Top-line strength and cost discipline resulted in sequential improvement to our adjusted operating margin this quarter, but profitability remains challenged by persistently high inflation and continued supply chain constraints.”
2022 Guidance Isn’t Helping XRX Stock
The company’s latest earnings report now has it expecting revenue to range from $7 billion to $7.1 billion for the year. Meanwhile, Wall Street calls for revenue of $7.1 billion in 2022. For the record, it’s prior revenue guidance had been at least $7.1 billion as well.
All of this has shares of XRX stock seeing heavy trading today. Some 5 million shares are changing hands on Tuesday as of this writing. The company’s daily average trading volume is well below that at 1.5 million shares.
XRX stock is down 17.8% as of Tuesday morning.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.