BUSINESSWEEK ONLINE : MARCH 5, 2001 ISSUE
COVER STORY

Xerox' History: The Highs and Lows


Once synonymous with corporate success and technological innovation, Xerox is now struggling with losses and a leaden stock-not to mention a reputation for fumbling high-tech opportunities

1938
Chester Carlson produces first xerographic image in his lab in Astoria, Queens.

1959
Launches the Xerox 914, the first automatic, plain-paper office copier--which becomes the top-selling industrial product of all time.

1961
Shares list on the New York Stock Exchange. Xerox becomes one of the great growth stocks of the go-go era.

1970
Opens Palo Alto Research Center, birthplace of the personal computer, laser printer, and Ethernet; much of the technology goes unexploited by Xerox.

1982
Visionary leader David T. Kearns becomes CEO, facing a dire competitive threat from Japanese rivals pioneering low-cost copiers.

1983
Begins a disastrous foray into financial services with purchase of Crum & Forster insurance group; later buys brokerage and life-insurance companies.

1990
Launches line of digital presses, creating lucrative new market; Paul A. Allaire named chief executive.

1993
Decides to quit financial services; announces first major layoffs, reducing workforce by 10%.

1995
Introduces digital copier, opening vast new market and creating a $3 billion-a-year business. But success blinds it to threat of desktop printers.

1997
Rick Thoman leaves IBM to become president and COO.

1998
Sells Crum & Forster at huge loss; slashes an additional 9,000 jobs, taking $1 billion write-off.

1999
Shares hit peak of $64 as Thoman is named CEO. But quick attempts to overhaul hidebound culture backfire. Earnings and shares plummet. U.S. inkjet printer sales hit $5.2 billion, with 50% controlled by Hewlett-Packard. Xerox logs 2% share.

MARCH, 2000
Announces 5,200 more layoffs.

MAY, 2000
Allaire ousts Thoman and returns as CEO.

DECEMBER, 2000
Reports largest quarterly loss under Allaire. Stock hits $7.

JANUARY, 2001
Announces 4,000 layoffs. Company again forced to deny it has plans to file for Chapter 11 bankruptcy. Leveraged buyout firms begin serious discussions for a minority stake in Xerox.



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