This Week in Imaging: Catching up with Xerox; Merger ‘Not Easy’ for Staples

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Alpaca foal; Photo credit: Kathy Wirth

“Well, that was easy” – but actually it wasn’t for Staples and Office Depot, which this week called off their proposed merger under which Staples would acquire Office Depot for some $6.3 billion. The announcement came after a district court approved a U.S. Federal Trace Commission injunction to block the merger. But did anyone think that this wasn’t a huge monopoly move and would hardly benefit consumers?

Staples also revealed that it’s closing more stores in North America, and that it’ll focus more on mid-size business companies, those with from 10 to 200 employees, and also on selling more ink and toner.

While the goings-on at Lexmark International and its proposed acquisition by a consortium of investors have naturally received quite a bit of coverage in the last few weeks, we thought a look at Xerox might be interesting.

As you probably know, in January 2016, Xerox announced that it would be separating into two separate, publicly traded Fortune 500 companies, one made up of Xerox’s document-technology (printer and MFP) group and its document outsourcing group, both of which generate about $11 billion in revenue. The second company will consist of Xerox’s business-process outsourcing group, which is essentially the former Affiliated Computer Services (ACS) that Xerox acquired.

Xerox currently expects a one-time separation cost of between $200-$250 million for its 2016 full year, and the separation will likely occur in January 2017. The company is also initiating a three-year program in which it expects to achieve $2.4 billion in cumulative cost savings. This year, it expects to achieve some $700 million in savings.

While overall Document Technology revenues declined in Xerox’s latest quarter, reflecting the slowing of office-printing revenues virtually everywhere as users, particularly in North America and Europe, move to digital communications via email and mobile devices, there were two bright spots. First, Xerox’s Document Outsourcing business had one of its best quarters in a while, with revenues up 5 percent, with one of its best customer-renewable rates and best channel MPS gains in the quarter, according to a Xerox source. The Document Outsourcing group includes services for business customers such as centralized print services, managed print services (where Xerox is number-one globally), and workflow automation – with all essentially designed to make to make business customers’ everyday business activities, from mailroom operation, to keeping MFPs and printers supplied with toner and up-and-running – faster and more efficient.

We’ll have some interesting and important news from Xerox’s Document Technology group next week, so please stay tuned.

Speaking of Xerox, this week Xerox partner Fuji Xerox said it’s teaming up with 3D-printer maker Stratasys to help bring Stratasys’s 3D printers to Australia. We’ve already seen various printer/MFP companies partner with Stratasys 3D-printer competitor 3D Systems. It appears that investors have finally realized that “2D” printer/MFP vendors with their long-established distribution, sales, and service networks are a natural fit for new kids-on-the-block 3D-printer makers, rather than make a go of it on their own.

Office-Imaging News

Staples, Office Depot Call Off Merger in Wake of U.S. District Court Ruling – Read more here.

HP Inc. to Seek Disruptive 3D, IoT Technologies with New HP Tech Ventures Group – Read more here.

Canon Adds imageRUNNER ADVANCE 8500 and 6500 Series to List of AirPrint-Enabled MFPs – Read more here.

Samsung Adds Ubiquitech Print-Management for Secure Printing with Samsung MFPs – Read more here.

Financial News

Sales, Profits Down for OKI’s Fiscal Year; Stronger Japanese Currency Seen as Culprit – Read more here.

Sales Up, But Profits Down for Brother International’s Fiscal Year; Printer Group Sales Steady – Read more here.

Kodak Reports Smaller Loss for First Quarter, But Revenues Lower Due to Decline in Legacy Consumer Inkjet – Read more here.

Record Cash Flow, Strong New Bookings for Nuance’s Second Quarter – Read more here.

Commercial and Production-Printing News

Konica Minolta to Re-Brand Commercial Printing Solutions with ‘Accurio’ Brand Name, Launch KM-1 Inkjet Press – Read more here.

New EFI Fiery Network Server for Xerox ConnectKey-Enabled i-Series MFPs – Read more here.

3D-Printing News

3D-Printer Maker Stratasys Teams Up with Fuji Xerox to Expand Reach in Australia – Read more here.

HP Inc. Blog: How HP’s 3D Printing Will Re-Shape the Future, from Manufacturing, to Entire Economies – Read more here.

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April 2016

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