HP 1st-Quarter Profit Up to $1.2 Billion [two articles posted]
Wednesday February 15, 4:27 pm ET
By Matthew Fordahl, AP Technology Writer
Hewlett-Packard First-Quarter Earnings Jump 30 Percent to $1.2 Billion
SAN JOSE, Calif. (AP) -- Hewlett-Packard Co.'s fiscal first-quarter profit jumped 30 percent on Wednesday as the printer and computer company saw cost-saving benefits from last year's restructuring and strong sales across most its product lines.
For the three months ended Jan. 31, HP earned $1.2 billion, or 42 cents per share, compared with a profit of $943 million, or 32 cents per share in the same period last year. Sales rose 6 percent, to $22.7 billion in the first quarter from $21.5 billion from the year-ago period.
Excluding one-time items, HP earned $1.39 billion, or 49 cents per share, compared with a profit of $1.08 billion, or 37 cents per share, in the first quarter of fiscal 2005.
On that basis, the results beat Wall Street expectations. Analysts were expecting Palo Alto-based HP to earn 44 cents per share on sales of $22.55 billion, according to a survey by Thomson Financial.
"Growth was balanced across most of our businesses and geographies, cash flow was strong and we were disciplined in controlling costs," said Mark Hurd, HP's chief executive. "While hard work remains ahead of us, our efforts are starting to show results."
Hurd, who replaced ousted CEO Carly Fiorina last March, has implemented measures to cut costs and reorganize the sprawling technology company. He reversed course on some of Fiorina's more controversial moves and, last July, announced plans to cut 14,500 jobs to bring HP's costs more in line with its competition. The total job cuts grew to 15,300 late last year.
The results were announced after the financial markets closed Wednesday. Shares of HP closed Wednesday at $31.67, down 82 cents or 2.5 percent, on the New York Stock Exchange. Later, they gained 3 percent, or 94 cents, in the after-hours session.
biz.yahoo.com
HP profit up on notebooks, printer supplies
Wednesday February 15, 4:49 pm ET
By Duncan Martell
SAN FRANCISCO (Reuters) - Hewlett-Packard Co. (NYSE:HPQ - News) on Wednesday posted a 23 percent rise in quarterly profit that topped Wall Street estimates, spurred by sales of notebook computers and printer supplies.
The company also gave a per-share profit forecast for the current quarter that was above the average Wall Street target, and shares rose 3.4 percent in after-hours trade.
HP, the world's No. 2 PC maker and No. 1 printer maker, said net income for its first fiscal quarter ended January 31 rose to $1.23 billion, or 42 cents per share, from $943 million, or 32 cents per share, a year earlier. Revenue rose to $22.7 billion from $21.5 billion.Excluding items, HP said it had a per-share profit of 48 cents per share, exceeding the average analyst estimate of 44 cents per share, according to Reuters Estimates. The analysts expected revenue of $22.6 billion.
Since taking the helm last April, HP Chief Executive Mark Hurd has announced a restructuring calling for the elimination of some 15,300 jobs estimated to save about $1.9 billion annually. He has said repeatedly he is not planning to spin off any of HP's business, something many analysts have pressed the company to do since its purchase of Compaq in 2002.
"It looks like each underlying division was very strong, especially the closely watched imaging division, which is the key to the valuation of the company," said Steve Neimeth, portfolio manager for AIG SunAmerica Mutual Fund. "In addition, overall margins were better."For the current quarter, HP said it expects a per-share profit before items of 47 cents to 49 cents per share on revenue of $22.4 billion to $22.6 billion.On that basis, analysts expect a profit of 45 cents per share, on average, within a range of 42 cents to 49 cents per share, on revenue of $22.6 billion.
Revenue in HP's PC group rose 8 percent from the year-earlier quarter to $7.4 billion as unit shipments of PCs and notebooks climbed 16 percent. Notebook PC revenue increased 26 percent.In the imaging and printing group, which accounts for a good deal of the company's overall profits, revenue climbed by 8 percent to $6.5 billion. Supplies revenue rose 11 percent.In its enterprise storage and servers group, revenue increased 5 percent to $4.2 billion and posted an operating profit of $326 million.
"It looks like another strong quarter and it's becoming kind of par for the course for Hurd," said Brent Bracelin, an analyst at Pacific Crest Securities. "The upside was driven by the imaging and printing business as well as strength in the core PC market."HP's board also authorized an additional $4 billion for repurchase of its common shares.
Shares of HP so far this year have risen 12 percent, based on Tuesday's closing price, compared with a 1.3 percent decline in rival International Business Machines Corp (NYSE:IBM - News). HP was the best-performing stock in the Dow Jones Industrial Average in 2005, rising 37 percent.Shares of HP climbed $1.07 to $32.74 in extended trade after falling 82 cents, or 2.5 percent, to close at $31.67 on the New York Stock Exchange.(Additional reporting by Caroline Valetkevitch in New York)
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