HP says 1Q earnings down 44 pct, beats Street


PALO ALTO, Calif. (AP) -- Hewlett-Packard Co., the maker of PCs and printers, on Wednesday said its net income fell, while sales fell 7 percent in the first full quarter under new CEO Meg Whitman.

HP's sales to consumers fared the worst, dipping 23 percent from a year earlier. HP is the world's largest maker of PCs, but it's been performing badly as buyers in the developed world are turning their attention to Apple's iPads and Macs. Meanwhile, it hasn't been able to capture the growing appetite for PCs in emerging markets.

Net income was $1.47 billion, or 73 cents per share, in the three months that ended Jan. 31. A year earlier, it was $2.6 billion, or $1.17 a share. Adjusted for one-time items, the company earned 92 cents per share, above the 87 cents expected by analysts surveyed by FactSet.

Revenue was $30 billion, down from $32.3 billion and slightly below expectations of $30.7 billion.

The revenue drop was even steeper, 8 percent, when taking out the effect of changes in currency exchange rates. It was the fastest revenue decline for the company since the recession hit 2009 results.

CEO Whitman replaced Leo Apotheker in September after a short and stormy reign. Apotheker announced that HP was looking to jettison its PC unit, which has large volume but small profits. That scared off some buyers, who may not have come back when Whitman decided to keep the division.

For the current quarter, the Palo Alto, Calif., company said it expects earnings of 88 cents to 91 cents per share. Analysts were expecting 95 cents per share.

HP shares fell 38 cents, or 1.3 percent, to $28.56 in extended trading, after the release of the results.

Results were buoyed by HP's business of providing information technology services to corporations. The company's second-largest division, after PCs, saw a revenue increase of 1 percent from a year ago.

Sales from the printing division, HP's third-largest, were down 7 percent, and its profitability continued to sag. Sales of printers fell faster than ink and toner sales.