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At a Glance
Uppers

Strong salaries and benefits package

Opportunity for advancement

Lots of job openings

Downers

Work schedules can be hectic

Demand for company's main product line falling thanks to new technologies

Managers sometimes fail to recognize good work

The Bottom Line

Pitney Bowes offers positions in a wide range of fields, but some employees fear how it will respond to a changing business environment.

About Pitney Bowes Inc.

Known as the world's largest producer of postage meters (1.1 million installed around the world), Pitney Bowes Inc. has moved into other areas of getting information from Point A to Point B. For sure, sending mail and packages is a big part of its business with services like pre-sort, label printing, and logistics among its offerings. But Pitney Bowes has integrated digital capabilities with its physical mail services and expanded into other digital areas. The company offers software-as-a-service and cloud-based services for ecommerce that facilitate cross-border shipping, enabling its clients to provide their customers with the complete cost of the transaction at checkout. More than three-quarters of Pitney Bowes’ sales are to customers in the US.

Operations

Pitney Bowes operates in three business segments: Small & Medium Business Solutions; Enterprise Business Solutions; and Digital Commerce Solutions.

Small & Medium Business Solutions (mail finishing, mail creation, shipping equipment, and software) includes North America Mailing and International Mailing. It accounts for about 50% of the company's sales.

Enterprise Business Solutions, which accounts for about 25% of sales, includes Production Mail (the sale, support, and other professional services of the company's high-speed, production mail systems, and sorting and production print equipment), and Presort Services.

The Digital Commerce Solutions, about 25% of revenue, segment offers Software-as-a-Service and on-demand applications for mailing, customer engagement, and geocoding and location intelligence software.

Pitney Bowes handles some of its own manufacturing, but most of it is done by third-party suppliers. The company also outsources the hosting of its software-as-a-service offerings.

Geographic Reach

Pitney Bowes’ primary manufacturing and assembly facility is in Danbury, Connecticut, and its principal research and development facilities are in Noida and Pune, India. Pitney Bowes has a strong dependence on the US market, which supplies more than 75% of the company's revenue.

Sales and Marketing

Pitney Bowes sells products and services to a variety of business, governmental, institutional, and other organizations though its sales force, direct mailings, outbound telemarketing, independent dealers and distributors, and over the internet. With a long history, the Pitney Bowes name is well-known among US corporations. The company counts 90% of companies listed in the Fortune 500 as customers, although small and medium businesses account for about half of revenue.

Financial Performance

Pitney Bowes’ revenue has trended lower over the past decade, falling about 76% from 2008 through 2017. The company might have halted the decline as sales have stabilized since 2015.

Revenue ticked 4% higher to $3.5 billion in 2017 from 2016, propelled by 63% and 32% growth in the Global Ecommerce (aided by the Newgistics acquisition and higher cross-border retail and marketplace volumes and growth in domestic shipping) and DCS segments, respectively. Sales fell year-to-year in the Small and Medium Business, North America Mailing and International Mailing segments due to lower equipment sales and recurring revenue.

Pitney Bowes’ net income did a 180 from 2016, leaping 180% to $261 million in 2017. The 2016 results included an after-tax goodwill impairment charge of $169 million that reduced earnings. The 2017 results benefited from a provisional one-time benefit of $39 million from the Tax Cuts and Jobs Act of 2017.

Cash from operations remained at $496 million year-to-year and it issued debt of $472 million in 2017. During the year it used cash to buy Newgistics for $471 million, spent $171 million on capital expenditures, and paid about $140 million in dividends.

Strategy

For nearly 100 years Pitney Bowes was a postage company, selling businesses postage meters and other products and services that moved mail. The company still moves mail: It processes about 15 billion pieces of mail a year through its operating centers in the US. But in the face of increased use of email and overnight services like FedEx, Pitney Bowes has restyled itself as a technology company, complete with digitization and cloud-based services.

Leading its technology charge is Commerce Cloud, an encompassing offering with analytics, logistics, application programming interfaces, payment management, and other functions. The company’s Global Ecommerce business, which delivered about $430 million in revenue in 2017 (up 9% from 2016), helps retailers as well as sellers on eBay to get goods to customers. Commerce Cloud also includes the company’s SendPro family of offerings that provide customers with the capability to send packages through multiple carriers from the same hardware device or software application that they use to send letters.

The acquisition of Newgistics, completed in 2017, helps Pitney Bowes expand into the US market while complementing its cross-border offerings. The company’s plan is to leverage Newgistics' network and volumes to benefit its parcel platform and the Global Ecommerce and Presort Services segments.

As its revenue has shrunk, Pitney Bowes has tried to do the same to its expenses, reducing its cost structure by $300 million in the past five years. It’s now looking to cut another $200 million over two years from across the company. Programs and people could be affected.

New products and lower costs aren’t the only strategic moves Pitney Bowes has made. In late 2017, the company began a process to explore and evaluate strategic alternatives to enhance shareholder value.

Mergers and Acquisitions

Pitney Bowes has made several acquisitions in recent years to bolster its ecommerce capabilities and diversify its offerings.

In 2017 the company bought Newgistics Inc., a provider of parcel delivery, returns, fulfillment, and digital commerce services for retailers and ecommerce companies, for $475 million. The deal speeds up Pitney Bowes’ expansion into the parcels market in the US and enhances its domestic ecommerce and presort offerings.

In 2016 Pitney Bowes bought Enroute Systems, a cloud-based, software-as-a-service enterprise retail and fulfillment company, for $14 million. This deal adds to the capabilities of Pitney Bowes in global e-commerce offerings for companies in the retail supply chain.

In 2015 the company acquired Borderfree, a provider of cross-border e-commerce tools and services platform, for $381 million. The purchase expanded Pitney Bowes' cross-border e-commerce capabilities.

The 2015 acquisition of Zip Mail Services brought the company a provider of intermediary services between customers and the US Postal Service. The price was $6 million.

With Real Time Content, another $6 million deal, will enable clients to provide personalized interactive video communications to their customers for $6 million.

Pitney Bowes Inc.

3001 SUMMER ST
Stamford, CT 06905-4321
Phone: 1 (203) 356-5000

Stats

Employer Type: Publicly Owned
Stock Symbol: PBI
Stock Exchange: , NYSE
President and CEO: Marc B. Lautenbach
EVP and COO: Michael Monahan
Chairman: Michael I. Roth
Employees (This Location): 3,500
Employees (All Locations): 13,300

Major Office Locations

Stamford, CT

Other Locations

Anchorage, AK
Phoenix, AZ
Brisbane, CA
Commerce, CA
Compton, CA
Corona, CA
Eureka, CA
Fullerton, CA
Huntington Beach, CA
Lake Forest, CA
Los Angeles, CA
Boulder, CO
Englewood, CO
Danbury, CT
Hartford, CT
Naugatuck, CT
Shelton, CT
Stamford, CT
Washington, DC
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Orlando, FL
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Albuquerque, NM
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Noida, India
Agrate Brianza, Italy
Roma, Italy
Usmate Velate, Italy
Chiyoda-Ku, Japan
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