Hewlett-Packard let the wind out of its sails a couple of weeks ago when it essentially pre-announced earnings with news of the 3Com acquisition. But with Dell's lousy financial report last week, there was still a healthy amount of interest in how each HP unit performed, and whether guidance would hold up.
HP delivered .
The company came in as expected with $1.14 a share; there was a nice, $400 million upside surprise to the company's top line, and in an environment like this one, it might be an even bigger deal for the company to surprise on revenue than on profits. HP has made a mint through operational efficiencies and cutbacks so bottomline performance hasn't been all that surprising. But better-than-expected sales just two weeks after pre-announcing is a nice little bonus.
On a unit by unit basis, HP Services came in at $8.9 billion with operating margin of 16.2 percent, essentially in line; Enterprise Storage and Servers reached $4.2 billion with operating margin of 11.4 percent, both metrics slightly below expectations; HP Software was a nice surprise, reporting $967 million against the $950 million expected, and operating margin of almost 25 percent was much better than the 20.9 percent anticipated; the company's Personal Systems Group, home to HP's personal computers, reported $9.9 billion in revenue, which was in line, but its operating margin of 5.5 percent was much better than the 4.9 percent projected; Imaging and Printing actually beat expectations even amid continuing concerns of a slowdown there with $6.5 billion and 18.1 percent margins; and Financial Services came in at $726 million and 7.4 percent in operating margins, virtually in line with expectations.
Guidance for the company's first fiscal quarter and all of fiscal year 2010 was right in line with what the company pre-announced.