HP Sales Soar Past Estimates

HP reported sales that surpassed estimates on firmer demand for computers and printers that are helping drive profitability, according to Bloomberg. Revenue rose 3.6 percent percent to $12.7 billion in the fiscal first quarter, the company said in a statement. Analysts on average projected $11.8 billion, according to data compiled by Bloomberg. The company also gave a forecast for profit in the current quarter that may top analysts’ estimates.

CEO Dion Weisler, under pressure from shrinking markets for printers and computers, is investing in the company’s products after reducing jobs and implementing other cost-cutting measures. HP, which split from Hewlett Packard Enterprise more than a year ago, is benefiting from rising demand in the premium parts of its lineup, including high-end laptops. Revenue for personal systems, which includes the computer lines, increased 10 percent from a year earlier to $8.22 billion in the quarter ended Jan. 31.

The company reported first-quarter profit, before certain items, of 38 cents a share, beating analysts’ estimates of 37 cents. Net income from continuing operations was $611 million, or 36 cents a share, little changed from a year earlier. Profit from continuing operations, excluding some items, will be 37 cents to 40 cents a share in the quarter ending in April, compared with the 38-cent average of analysts’ projections.

In the personal systems group, consumer sales rose 15 percent and commercial sales rose 7 percent in the first quarter. Notebook shipments climbed 12 percent, while desktop unit sales were unchanged. The total market for personal computers showed some improvements in the last three months of 2016. Overall shipments of PCs fell 1.5 percent. Globally, HP was No. 2 with 21.7 percent market share, slightly behind Lenovo, which had 22.4 percent.

The printing unit also fared better in the quarter. Printing revenue declined 3.4 percent compared to a drop of 8.2 percent in the previous quarter. Consumer printing unit sales performed better than the commercial business. The company is making investments in the group to help bolster sales in various areas. In September, it agreed to buy Samsung’s printer business for $1.05 billion, betting that it can grab share and generate income.