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HP's Higher Earnings Meet Firm's Recent Guidance

Hewlett-Packard reported a profit that exceeded analysts' expectations but matched a recent preannouncement from the company.

Hewlett Packard
AP
Hewlett Packard

HP said it earned 87 cents a share in the second quarter, on sales of $28.26 billion. In the same period last year, HP earned 70 cents a share on sales of $25.53 billion.

HP, the world's largest technology company by revenue, preannounced better-than-expected earnings for the quarter last week.

HP said then that according to preliminary results it earned 80 cents a share in the quarter ended April 30. The figure of 87 cents a share excludes amortization costs.

Analysts, on average, expected a profit of 85 cents per share, excluding items, on sales of $28.1 billion, according to a poll by Thomson Financial.

The company kept intact its earlier forecast for third-quarter earnings of 82 cents to 83 cents per share, excluding special items.

For the third quarter, HP expects sales of $27.3 billion to $27.4 billion. The Street had originallly anticipated sales of $27.3 billion for HP's third quarter.

Operating margin, excluding special items, was 10 percent, up from 9 percent a year earlier and 9.9 percent in the first quarter, HP said.

HP shares edged lower by less than 1 percent in extended electronic trading after finishing 0.54 percent lower at $46.46 Tuesday. Shares of Palo Alto, Calif.-based HP gained 6 percent during the quarter to close at $46.35 at the end of April.

International markets accounted for 70 percent of revenue, with that from Europe, the Middle East and Asia rising 16 percent on the year to $11.1 billion. Revenue from Brazil, Russia, India and China grew 26 percent over a year earlier.

"HP turned in another strong quarter, supported by improvement across our businesses," Chief Executive Mark Hurd said in a statement. "We benefited from robust demand in emerging economies."

HP's personal computer business grew 16 percent from a year earlier, with unit shipments up 21 percent. Notebook revenue grew 31 percent while desktop revenue was flat.

The company's imaging and printers segment grew 6 percent, while enterprise storage and servers revenue rose 4 percent and services grew 12 percent, HP said.

The tech bellwether had pushed back its quarterly report, originally scheduled for last week, after announcing last Tuesday it agreed to buyElectronic Data Systems.

- Wire services contributed to this report.

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