Xerox shares fall amid pessimistic forecasts

Xerox Holdings Inc shares fell about 25% on Tuesday. The drop in the company's stock came after the photocopy maker cut its annual earnings and cash flow forecast. The company attributes this to a stronger dollar and a slow economic recovery, Reuters reports.

The hybrid work environment has increased pressure on the company, which is already struggling with firms and consumers moving to digital documents to save money and protect the environment.

The company cut its annual free cash flow (FCF) forecast from about $400 million to $125 million.

The decline in the company's free cash flow, according to Xerox, is partly due to high inflation and slow supply chain improvement.

In a phone call with analysts, Xerox CEO Stephen Bandrowczak mentioned that the global macroeconomic outlook has been especially somber over the past three months.

The corporation's Finance Chief, Xavier Heiss, in turn, said that he expects a quarterly improvement in FCF profitability due to price increases to counter higher costs and better supply.