HP's 4Q profit gains 14%

• Source: Global Times
• [15:43 November 24 2009]
• Comments

Hewlett-Packard (HP) reported Monday its fiscal fourth-quarter profit gained 14 percent despite an 8.4 percent decline in revenue compared with a year ago.

According to the quarterly report, HP's profit for the quarter ending Oct. 31 was $2.4 billion, up 14 percent from $2.1 billion a year ago, while revenue was $30.8 billion, 8.4 percent lower against previous year's $33.6 billion. Its operating margin grew to 10.2 percent from 8.2 percent a year earlier.

Mark Hurd, HP's chief executive, said during a conference call with financial analysts on Monday that the company's printer division appears poised for a recovery, and personal computer sales are benefiting from "good consumer acceptance" of Microsoft's new Windows 7 software. He also said "HP's solid performance in services drove record profit."

HP's printer division posted a profit increase of 1.4 percent while the personal computer business saw a profit decline of 25 percent, with sales of personal computer units up 8 percent, and earnings in the services segment improved 53 percent, according to the report.

During the quarter, there was "very strong growth" in China, but HP is taking a more prudent approach to Europe, the Middle East and Africa. In these regions, it is "still basically a wait-and-see mode," said Cathie Lesjak, HP's chief financial officer.

The quarterly report disclosed that revenue dropped 17 percent in the Europe, Middle East and Africa region and 1 percent in Asia Pacific, while revenue from the personal computer business in China rose 40 percent.

Earlier in November, HP agreed to acquire 3Com for $2.7 billion in a deal to expand its network infrastructure business as well as to boost its market presence in China.