Lexmark announced it would be exiting the development and manufacturing of inkjet hardware Tuesday. The move comes as part of the company’s restructuring; a restructuring that Lexmark says will ultimately save the company $95 million annually once fully implemented.
"Today's announcement represents difficult decisions, which are necessary to drive improved profitability and significant savings," said Paul Rooke, Lexmark chairman and chief executive officer in a statement.
"Our investments are focused on higher value imaging and software solutions, and we believe the synergies between imaging and the emerging software elements of our business will continue to drive growth across the organization. As we move forward, we remain confident in our strategy, competitiveness and ability to create value for shareholders,"
Inkjet hardware and supplies accounted for 21% of Lexmark’s revenue in 2012. The market for the printers has been on a gradual decline, with inkjet printers being replaced by laser printers and paperless options.
The company will be eliminating its inkjet development worldwide by the end of 2013, and closing its Cebu, Philippines, inkjet supplies manufacturing facility by the end of 2015. The restricting is expected to eliminate 1,700 positions worldwide, include 1,100 manufacturing jobs.
The company also plans to buy back $100 million in shares during the remainder of 2012.