HP Earnings, Outlook Beat Expectations
Hewlett-Packard's earnings and outlook topped analysts' expectations, which CEO Meg Whitman attributed to a better-than-expected performance in enterprise services and printing.
"I am encouraged by our performance in the second quarter, and I feel good about the rest of the year," Whitman said.
HP shares jumped more than 10 percent after the report. (Click here for the latest after-hours quote.)
Net income slid 32 percent to $1.08 billion, or 55 cents a share, in the fiscal second quarter, from $1.59 billion, or 80 cents a share, in the year-earlier period.
Excluding items, earnings fell to 87 cents a share from 98 cents a share a year ago.
Revenue declined 10 percent to $27.58 billion.
Analysts were expecting earnings of 81 cents per share on revenue of $28.01 billion, according to estimates from Thomson Reuters.
For the fiscal third quarter, HP said it expects earnings of 84 to 87 cents a share vs. expectations of 83 cents a share.
For the full year, HP expects earnings of $3.50 to $3.60 a share vs. expectations of $3.48 a share.
Daniel Morgan, an analyst at Synovus Trust, said that "no new bad news is a good news" in this report and that it led to the positive reaction in the market.
"We already knew the PC market was bad, we already knew about Dell, we knew unit growth in the first quarter according to IDC for HP was down 23 percent," he told CNBC.
Paul Meeks of Saturna Capital noted a "robust" free cash flow, but said that company has a poor exposure to the two key areas in hardware—smartphones and tablets.
"If you are going to try to pin your hopes in the future on any kind of resumption of growth in PC—that is not going to happen," he said.
Last week Dell reported earnings that fell short of the market expectations and cited decline in PC sales.