Hewlett-Packard profit rises 28% to $2.2 billion
Hewlett-Packard Co., the world’s largest personal computer maker, reported fiscal second-quarter earnings and sales that beat analysts’ estimates.
Net income in the quarter ended April 30 rose 28% to $2.2 billion, or 91 cents a share, from $1.72 billion, or 71 cents, a year earlier, the Palo Alto company said Tuesday.
Excluding some costs, profit was $1.09 a share. That compared with the $1.06 average of estimates compiled by Bloomberg. Sales rose 13% to $30.8 billion. Analysts projected $29.8 billion.
Hewlett-Packard is seeing growth in demand for PCs and printers, which represent more than half of its sales. At the same time, corporate buyers are upgrading the servers used to run their businesses after delaying purchases last year. Global spending on information technology will rise 5% in 2010, with Hewlett-Packard, the world’s largest IT supplier, among the biggest beneficiaries, Goldman Sachs Group Inc. predicted.
“The hardware business including PCs, printers and servers continues to rebound,” said Shaw Wu, an analyst with Kaufman Bros. in San Francisco.
Profit this quarter will be $1.05 to $1.07 a share on sales of $29.7 billion to $30 billion, Hewlett-Packard said. Analysts had anticipated fiscal third-quarter profit of $1.07 and revenue of $29.7 billion.
Its shares fell 73 cents, or 1.5%, to $46.79 on Tuesday.
Hewlett-Packard recaptured the PC market lead from Dell Inc. in 2006 and has been working to maintain its ranking by adding slimmer notebook models and introducing low-cost netbooks. Chief Executive Mark Hurd plans a foray into tablet-style computers that would compete with Apple Inc.’s iPad. He’s also using acquisitions to expand into smart phones and the networking equipment market dominated by Cisco Systems Inc.
HP is being challenged by rivals Acer Inc., which overtook Dell last year to become the No. 2 PC maker, and Lenovo Group, which is winning buyers in China, according to researcher Gartner Inc. Hewlett-Packard’s first-quarter PC shipment growth was 19.9%, compared with 54.3% for Acer, 21.4% for Dell and 59.2% for Lenovo, Gartner said.
