Hewlett-Packard reported a 19% drop in quarterly profit as sales fell sharply in several of its business units but the company presented a positive outlook suggesting a "stabilized market" and signalling that tech spending has hit bottom.
The World's top PC maker and leading printer manufacturer, reported earnings of $1.64 billion, or 67 cents a share, for the quarter ended July 31st, down from $2.03 billion, or 80 cents a share, a year ago.
HP's quarterly revenue fell 2% to $27.45 billion from $28.03 billion a year earlier, despite the impact of billion dollars in additional revenue from tech-services company Electronic Data Systems, which was acquired last year.
“HP’s performance this quarter is a result of our strong business portfolio, efficient cost structure and scale. We made positive gains in extending our market leadership in key segments and strengthening our competitive position,” said
Mark Hurd, HP chairman and chief executive officer.“Business is stabilizing, and we are confident that HP will be an early beneficiary of an economic turnaround and will continue to outperform when conditions improve.”
HP posted PC revenue of $8.43 billion for the quarter, down 18% from last year, despite a 2% growth in shipments. Operating profit in the PC division dipped 34% as computer prices fell .
Printer unit revenue dipped 20% to $5.66 billion as customers retrenched on ink and printing supplies.
“Record profit in Services, double-digit revenue growth in China, and solid cash flow demonstrate HP’s ability to execute,” said
Cathie Lesjak, HP executive vice president and chief financial officer. “We are investing for the future and executing operational efficiencies with the goal of driving long-term, profitable growth.”
Revenue grew 8% in the Americas to
$12.6 billion. Revenue declined 12% in
Europe, the
Middle East and
Africa and 4% in
Asia Pacific to
$9.9 billion and
$5.0 billion, respectively. When adjusted for the effects of currency, revenue grew 11% in the Americas while declining 2% in
Europe, the
Middle East and
Africa while
Asia Pacific was flat.
Revenue from outside of
the United States in the third quarter accounted for 62% of total revenue, with revenue in the BRIC countries (
Brazil,
Russia,
India and
China) declining 6% over the prior-year period while accounting for 10% of total HP revenue.
Results detail
