Pitney Bowes Inc. (NYSE:PBI) shares are trading higher after the company provided an update on the first phase of its cost rationalization initiative, initially announced in late May 2024.
The company has identified and implemented around $70 million in cost savings, with most of these savings realized in the second quarter.
Pitney Bowes expects non-recurring charges of about $25 million related to these efforts to be recorded in the second quarter.
The cost reductions are expected to be mostly reflected in the company’s pre-tax earnings for the second half of 2024 and fully realized in 2025, primarily from expense reductions in SendTech and Presort.
Additionally, management has identified further opportunities to achieve efficiencies in the coming months, increasing the expected savings from an initial target of $60 million-$100 million to $120 million-$160 million.
The company anticipates that a substantial portion of these additional savings will be realized by the end of 2024, while some initiatives will extend into 2025.
In May, Pitney Bowes reported a first-quarter loss per share of $0.01, beating estimates; revenues stand at $830.509 million, surpassing expectations.
At that time, the company said it expected FY24 revenue growth to be flat to a low-single-digit decline and stable EBIT margins.
Investors can gain exposure to the stock via Invesco Exchange-Traded Self-Indexed Fund Trust Invesco Russell 2000 Dynamic Multifactor ETF (BATS:OMFS).
Price Action: PBI shares are up 13.6% at $5.77 at the last check Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
