Why Photocopy Giant Xerox Shares Are Down Today

Xerox Holdings Corporation XRX shares are trading lower today.

Yesterday, Xerox announced its intention to offer, $300 million of convertible senior notes in a private placement to qualified institutional buyers.

The company expects to grant the initial purchasers of the Notes a 13-day option to purchase up to $45 million of additional notes.

The company also announced an increase in the maximum tender cap for 5.000% senior notes due 2025.

The company raised the maximum principal amount of its $750 million principal amount outstanding to $362 million from $94 million for 5.000% Senior Notes due 2025, which can be repurchased under its previously announced cash tender offer for the 2025 Notes. 

The terms of the previously announced cash tender offer by Xerox for its 3.800% senior notes due 2024 remain unchanged.

Xerox expects to use the net proceeds to fund the cost of the capped call transactions and for general corporate purposes.

Last month, Xerox reported a fourth-quarter sales decline of 9.1% Y/Y to $1.77 billion, missing the $1.79 billion estimate and adjusted EPS of $0.43, which fell short of the $0.52 expected.

The company witnessed equipment sales drop 17.3%, post-sale revenue down 5.8%, and guided FY24 revenue below consensus.

Price Action: XRX shares are down 9.21% at $17.06 on the last check Wednesday.