LEXMARK:CHANNEL INVESTMENTS PAYING OFF

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LEXMARK:CHANNEL INVESTMENTS PAYING OFF

 user 2007-09-10 at 10:12:00 am Views: 39
  • #18718
    Lexmark Exec Says Channel Investments Paying Off

    SEP
    07 Lexmark, which has been under profit pressure for the past quarter,
    continues to bank on investments it has made in broadening its product
    lineup and in building out its solution provider channel, a top
    executive said Wednesday.John Gamble, CFO of the Lexington, Ky.-based
    printer company, made his remarks at the Citigroup Global Technology
    Conference in New York. He declined to say when the company’s profit
    margin would bounce back from its current rough patch — including the
    last quarter when the company fell shy of Wall Street’s earnings
    estimates. But he said Lexmark continues to make strategic investments
    where the company believes they will do the most good.Lexmark has
    launched several new products this year, including wireless inkjet
    printers for the low-end space, color multi-function printers, and an
    MFP tailored for the legal vertical market. The company has also
    continued to work on building out its ranks of solution providers,
    since introducing a new channel program almost two years ago. At the
    same time, Lexmark has made some management changes — moving Paul
    Rooke, who had been president of its printing division, to head up its
    consumer unit, and named Marty Canning as president of its printing
    services and solutions division.”We’re feeling better and better about
    the strength of the portfolio we’re bringing to market,” Gamble said.
    “We began investing more heavily in the past year on the resources to
    bring (new) product to market. If you look over what we’ve done in the
    past year in terms of growth in MFPs, and color and higher-end
    placements and in the enteprrise business where we have historically
    been strong, and in vertical industries where we’ve been strong, we
    think we’ve seen very good performance and we think we’ve grown very
    well.”"Over the past several years, we’ve increased development
    spending, we’ve increased spending on the channel,” Gamble said, noting
    that Lexmark has seen the greatest return on channel investment in the
    higher-end laser printer segment.The company remains under pressure,
    though, with some on Wall Street offering skepticism about a near-term
    turnaround for Lexmark. Last week, Goldman Sachs issued a report on
    Lexmark — on which it has a “sell” rating — that lowered its stock
    price target from $45 to $40, saying, among other things, that its
    “core inkjet franchise continues to erode at the hands of better funded
    competition like HP.”