HP Revenue Beats Estimates as PC Maker Bucks Industry Declines

HP Revenue Beats Estimates as PC Maker Bucks Industry Declines
Fotolia

HP reported revenue that beat analysts’ estimates, with an industry-defying surge in personal-computer sales driving a fifth consecutive quarterly increase, according to Bloomberg.

Sales at the world’s biggest maker of PCs rose across all businesses and all regions in the fiscal fourth quarter. While profit for the current period may fall slightly below analyst projections, the company raised by one cent its forecast for the fiscal year that started Nov. 1. Adjusted profit of 44 cents in the three months through Oct. 31 matched analyst predictions.

CEO Dion Weisler has spent much of the past year cutting costs, introducing new products and expanding the company’s 3-D printer offerings. Those efforts helped push revenue 11 percent higher from a year earlier to $13.9 billion, HP said in a statement.

HP’s PC shipments grew 4.4 percent in the three months through September from the same period a year earlier, even as the rest of the industry endured a 3.6 percent decline. That made it the top-selling PC brand for the second consecutive quarter over Lenovo. Sales in the personal systems group, which includes PCs, gained 13 percent in recent quarter, after rising 12 percent in the previous period.

Analysts estimated $13.4 billion in fiscal fourth quarter sales. Net income increased to $660 million, or 39 cents a share, from $492 million, or 28 cents, a year earlier. While HP’s total costs rose about 10 percent in the quarter, the increase was proportionately smaller than the jump in sales. The spending is spread across R&D, marketing and field-selling costs.

Profit, excluding some items, will be 40 cents to 43 cents a share in the fiscal first quarter, HP said. Analysts forecast 42 cents a share. A year ago, Weisler announced plans to cut 3,000 to 4,000 jobs over three years, a move aimed at generating $300 million in savings.

Printing revenue increased 7 percent to $4.88 billion. The division is expanding with the $1 billion acquisition of Samsung’s printer business, a deal that was completed at the start of November and that’s meant to bolster HP’s push into the market for larger office copiers. That acquisition has prompted HP to raise its adjusted profit forecast for next year to $1.75 to $1.85 per share.