Lexmark Misses Estimates on Weak Sales, Pricing Pressure

Computer printer maker Lexmark International said quarterly profit rose 7% but the results and its outlook missed Wall Street expectations, sending shares down more than 8%.

Sales of equipment Lexmark made for other brands continued to be weak in the first quarter, which also saw a decline in sales of inkjet supplies, and aggressive hardware pricing in the laser and inkjet markets, the company said.

It said net income for the quarter rose to $92.4 million, or 95 cents a share, from $86.2 million, or 78 cents a share, a year earlier.

Excluding one-time costs for restructuring, profit per share was 96 cents, missing the average $1.03 forecast by analysts, according to Thomson Financial.

Revenue fell 1% to $1.261 billion, in line with the $1.26 billion forecast by Wall Street according to Thomson Financial.

Under pressure to improve its results, Lexmark last year said it would reduce sales of unprofitable inkjet printers, a move that some analysts have said would shrink the number of
its printers on the market and cut into profitable sales of supplies.

Lexmark forecast second-quarter revenue to fall in the low- to mid-single digit percentage range year over year, and estimated earnings per share to be in the range of 82 cents to 92 cents.

Analysts were looking for second-quarter revenue to rise less than 1% to $1.245 billion, and forecast net profit per share at 99 cents excluding items.

Lexmark shares, which have declined about 17% so far this year, fell to $57.30 in pre-market trading from their New York Stock Exchange close on Monday of $62.01.



Contact U.S. News


    Get the best of CNBC in your inbox

    › Learn More

Don't Miss

U.S. Video

  • House Oversight and Government Reform Committee chairman, Rep. Darrell Issa, (R- Calif.), discusses if Congress will reauthorize the Ex-Im Bank. Issa says regulating and making the Ex-Im Bank honest transparent will help promote the banks confidence.

  • Recently Chipotle stock has soared while Panera has flattened out. Nick Setyan, Wedbush Securities, and Robert Derrington, Wunderlich Securities, discuss what Chipotle is doing right and Panera is doing wrong.

  • Cynthia Silver, Century 21 Martinez & Associates; Patricia Delinois, Century 21 Premier Elite Realty; and Jo Gipson, Atlanta Intown Real Estate, discuss if the slowdown in housing is a bad thing or if it could spur sales.