LEXMARK PRINTERS BACK AT BESTBUY.COM
good news amid announcement of 21% drop in stock price
Lexmark
executives announced Tuesday its inkjet printers are once again for
sale inside Best Buy, the nation’s largest consumer electronics chain.
It was good news on a day that was otherwise dominated by the company’s
stock price suffering a major fall.While Best Buy has continued to sell
Lexmark ink and sold the company’s printers on BestBuy.com, it has not
sold them in stores since 2008.”We are excited about Best Buy,” said
Paul Rooke, Lexmark’s new CEO and still the leader in the interim of its
inkjet printer division. “It’s a better demographic, higher-end
customer for us. “That’s what we’re driving for as we reach higher-usage
customers.”Rooke told the Herald-Leader the company’s success in office
superstores, including Office Depot, Staples and OfficeMax, “helped
turn their head.”
Best Buy is stocking three products: the $99
Impact, $199 Interact and $299 Pinnacle Pro. The company has also
started taking pre-orders for Lexmark’s Genesis, an all-in-one set to
debut in January that includes a new document-scanning technology that
dramatically reduces scanning speeds.”Best Buy is really excited about
that,” Rooke said.
That was the good news in the earnings report
for the inkjet division, which saw revenue drop 10 percent year over
year. The company had gotten closer to having year-over-year growth in
the division, but fell short as the growth in sales of high-end inkjets
was more than offset by the decline in sales of low-end units.
The
sales drop-off there contributed to the company falling short of
analysts’ expectations of $1.04 billion in sales. Instead, Lexmark grew
revenue 6.5 percent year over year to $1.02 billion overall in the
quarter.
Some of the investor sentiment likely also concerned the
company’s announcement of the pending retirement of CEO Paul Curlander,
who has guided Lexmark out of the recession to revenue growth in each
of its past three quarters. The company’s stock shed $10.01, or 21
percent, as it fell to $37.71.
The company’s stock was also
downgraded from “buy” to “hold” by Standard & Poor’s analyst Tom
Smith, who noted the company’s lower-than-expected revenue growth.