* Lowers full-year adj profit forecast to $1.07-$1.13/share
* Net income falls 5 pct to $281 mln in the first quarter
* Revenue falls about 2 pct to $5.12 bln
(Adds Xerox forecast, details on Lexmark, share movement)
April 22 Xerox Corp cut its full-year
earnings forecast as growth stalled in its services business and
margins contracted due to higher investment on U.S. health
insurance exchange platforms, sending its shares down about 5
percent in premarket trading.
The company, which has been diversifying away from its
printers and copiers, lowered its full-year adjusted profit
forecast to $1.07-$1.13 per share from $1.10-$1.16.
Gross margin fell to 30.2 percent in the first quarter from
30.5 percent a year earlier, hurt by a 0.7 percentage point drop
in services margin.
Services, which includes businesses ranging from toll
systems to healthcare programs, accounts for more than half of
the company's revenue.
Xerox forayed into the services business with its $5.5
billion purchase of Affiliated Computer Services Inc in 2009 to
counter dropping sales in its printers and copiers business.
The company reported a 5 percent fall in first-quarter
profit, hurt by dwindling revenue from its printing business.
Net income attributable to Xerox fell to $281 million for
the three months ended March 31, from $296 million a year
earlier. On a per share basis, net income was flat at 23 cents.
Revenue fell about 2 percent to $5.12 billion.
Smaller rival Lexmark International Inc reported
first-quarter adjusted earnings above analysts' average
estimate, helped by higher revenue from its managed print
services and software businesses.
The company, however, said it expected revenue in the second
quarter to decline 2-4 percent from a year earlier as the
negative impact from the inkjet exit continues.
Lexmark also forecast second-quarter adjusted earnings of
about 85-95 cents per share, compared with $1.04 a year earlier.
Xerox's shares were down at $10.47 in premarket trading
while Lexmark's shares were down about 4 percent at $45.12.
(Reporting by Abhirup Roy in Bangalore; Editing by Saumyadeb
Chakrabarty and Don Sebastian)