After Lexmark's announcement on July 9 that its financial results for the second quarter of 2007 will be lower than expected, some pundits are painting a dim picture for the printer OEM.
A Forbes.com article puts the source of Lexmark's troubles plainly: "Today, however, Lexmark’s woes have nothing to do with a tech bust. Simply, customers are not buying Lexmark products."
The company expects earnings per share for the 2Q to be in the range of $0.62 to $0.67, including an expected tax benefit of about $0.05 per share. This compares to the $0.82 to $0.92 earnings-per-share guidance it provided. Lexmark said the shortfall is primarily due to less-than-expected inkjet supplies revenue, lower hardware average-unit revenue driven by aggressive pricing and promotion, some greater-than-expected product costs, and greater-than-expected branded inkjet unit growth. As for the immediate future, the company expects these same factors to impact the 3Q, when it said it expects earnings per share to be around $0.00 to $0.10.
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