Why Is Exela (XELA) Stock Down 12% Today?

  • Exela (XELA) stock is falling alongside the release of its second-quarter earnings report.
  • The company massively missed earnings per share (EPS) estimates.
  • Revenue for the quarter also came in below Wall Street's expectations.
blue graphic of person's face made of binary code and microchip lines representing XELA stock.

Source: shutterstock.com/Peshkova

Exela (NASDAQ:XELA) stock is falling on Wednesday after the business process automation company reported preliminary second-quarter results.

The bad news for XELA stock starts with the company’s adjusted earnings per share (EPS) loss of $3.22. That’s a massive miss next to Wall Street’s  estimate of -$1.20 per share, even if it is better than the -$6.60 per share reported in the same period last year.

Investors following XELA stock will note that this isn’t the first time the company has missed EPS estimates in recent history. In fact, Exela has failed to surpass EPS estimates in its previous four earnings reports.

The company’s revenue of $266.8 million isn’t helping matters. That figure is nowhere close to the $285.25 million analysts had expected. It’s also a 9% drop from the $293 million reported in Q2 2021.

This decrease in revenue is due to a 12.6% year-over-year (YOY) decrease in ITPS revenue. XELA attributes this drop to a network outage experienced during the quarter.

Executive Chairman Par Chadha said the following in Exela’s earnings report:

“Our business is prepared for tomorrow with tenured management and many additional new leaders with fresh ideas, who together are working on improving operating results while combating headwinds from the strong dollar, tight job markets, inflation and a network outage.”

XELA stock is down about 12% as of Wednesday morning.

There’s more recent stock market news for traders to dive into below!

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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Article printed from InvestorPlace Media, https://investorplace.com/2022/08/why-is-exela-xela-stock-down-12-today/.

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