Hewlett-Packard Plans Line of Low-Cost Inkjet Printers

Hewlett-Packard Co. is expected today to introduce a line of bargain printers, marking an aggressive push by the computer giant to dominate the market for inkjet printers priced less than $100, analysts said.

Palo Alto-based HP controlled 55% of the U.S. printer market as of the end of April, but it had just 36% of the market for printers priced less than $50, according to the latest figures available from NPD Intelect, a market research firm in New York.

Noting that the niche is “one area of the inkjet market where HP has yet to dominate,” Don Young, an analyst with UBS Warburg, predicted HP could garner an additional $80 million to $100 million a year on printer sales.

The figure doesn’t include sales of replacement ink cartridges, which have especially high profit margins.

HP executives declined to comment on the announcement, scheduled to take place this morning at the opening of the PC Expo in New York.

About 58% of inkjet printers sold in April cost less than $100, according to NPD. Although HP has sold low-priced printers, it has not been as good at squeezing out costs as its rivals, including Lexmark and Epson, said Paul McGuckin, vice president of Gartner Inc.

More than one-fifth of HP’s $81-billion annual revenue comes from the sale of printers and ink cartridges. The business is widely regarded as HP’s crown jewel.

HP shares fell 56 cents to $15.90 on the New York Stock Exchange.