The IBM derivative is looking to save around $95 million (£60m) a year in a move that will see it cut approximately 1,700 jobs around the world.
Lexmark has pledged to continue offering supplies, service and support to customers who previously purchased its inkjet hardware, and will now focus on high-end imaging and software.
The firm plans to cease its inkjet development by the end of next year, and will shut down its Cebu, Philippines manufacturing facility by the end of 2015.
A purchaser for its inkjet technology is being sought, with Lexmark planning to buy back $100m (£63m) in shares through the third and fourth quarters of the current fiscal year.
Lexmark has struggled to compete with the inkjet market's leaders HP and Canon in recent years, influencing the manufacturer to undergo a multimillion dollar restructuring.