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Lexmark gears up for 2003

The printer maker is starting the year off with new all-in-one devices, business machines and document management software.

Lexmark on Thursday launched several new products, including two printers and a document-management software suite, in an effort to gain a bigger piece of the printing market in 2003.

The company's newest printers are intended to match models sold by Hewlett-Packard, Canon, Epson and other manufacturers at retail and also in the business market.

Lexmark's new X5150 All-In-One Print Center aims to boost the company's stature in the eyes of people looking for omnibus devices. The machine, which can copy, scan, fax and print documents in color, will start at $149.

The all-in-one segment of the printer market has been red-hot at retail in the United States, NPDTechworld analyst Steve Baker said.

"It used to be that all-in-ones were an ugly stepchild, but that's not the case anymore," he said. "A lot of people are trading in (standalone inkjets) for $130 to $200 all-in-one machines. There's real value there to someone who doesn't have a scanner at home to make copies or send a fax."

Unit sales of all-in-one machines rose by nearly 43 percent during the 11 months of 2002, while revenue rose by 32 percent over the same stretch, compared with the year-earlier period, Baker said. Meanwhile, inkjet sales were basically flat.

Although Canon, Brother and Epson also compete in this arena, HP and Lexmark have established themselves as the leaders.

"Lexmark has been very good at being able to leverage the growth in the all-in-one business," Baker said. The company early on offered attractive prices for all-in-one flatbed scanners, he said. "That's proven to be very popular for customers."

Lexmark also aims to take on HP in the business market with an inexpensive new monochrome laser printer for offices. The Lexmark T420d, priced at $649, can print as many as 22 pages per minute, the company said.

The company also launched new document management software for businesses. The Lexmark Document Solutions Suite was designed to let businesses better input, host and manage documents online. When a document is needed, employees can use one of several Lexmark printers to find it and then print it. The system is meant to help businesses increase efficiency and save on costs, the company said.

Separately on Thursday, the printer manufacturer logged record earnings for the fourth quarter.

Lexmark reported a profit of 90 cents per share on revenue of $1.2 billion for the fourth quarter. Analysts had expected the company to show a profit of 86 cents per share, according to financial research firm First Call. The company matched analysts' revenue expectations and hit the high end of its own revenue expectations, which it had increased in early January.

For the current quarter, the Lexington, Ky., manufacturer expects to see an increase in revenue in the low to middle single digits and profit of 62 cents to 72 cents per share, up from 53 cents in the first quarter of 2002. The company's visibility into the quarter is clouded by uncertainty about consumer and business spending, company executives said in a conference call to discuss its earnings.

For the full year in 2002, Lexmark recorded a profit of $2.79 per share on revenue of $4.4 billion.

Executives didn't mention it on the conference call, but Lexmark also stands to benefit from a deal it signed with Dell Computer last year.

Lexmark will supply Dell with printers and ink, potentially boosting the printer manufacturer's sales of ink and other consumables during 2003.

Dell has been mum on most of the details of its new products. But a company representative said recently that its printer plans are on track.