HP reports 13 drop in net profit

Hewlett Packard, the world's largest technology company, reported a 13 per cent drop in quarterly net profit and lowered its outlook f
or the full fiscal year.

HP said net profit declined to $1.9 billion in the first quarter of its financial year from $2.1 billion a year earlier. It said revenue for the quarter ending in January was up one percent at $31.93 billion.

"HP is a market leader executing well in a tough market," HP chairman and chief executive officer Mark Hurd said. "Our market strength, disciplined cost management and diverse portfolio allowed us to differentiate HP in the global marketplace and gain share in key markets."

The Palo Alto, California-based company said it expected earnings per share of $3.76 to $3.88 for the current fiscal year, down from a previous forecast of $3.88 to $4.03.

Analysts had expected earnings per share of $3.77. The new estimate is still above the $3.62 of fiscal 2008.

HP, the world's number one personal computer maker, said it expects revenue to fall by two percent to five percent in fiscal 2009 including a dip of two percent to three percent in the second quarter of the year.

Besides personal computers, HP is a major provider of servers, printers, software and services. HP said revenue grew 11 per cent in the Americas in the first quarter to $12.4 billion while declining by three percent in Europe, the Middle East and Africa to $12 billion.

Revenue grew by 11 per cent in Asia Pacific to $4.4 billion.

Revenue was lower across nearly all of HP's product lines with notebook computer revenue falling by 13 percent and desktop revenue declining by 25 percent.

HP said revenue from its imaging and printing group declined 19 percent to $6.0 billion. Commercial hardware revenue declined by 34 percent while consumer hardware revenue fell by 37 percent. Printer unit shipments decreased by 33 percent.

In electronic after-hours trading, HP lost 3.26 percent to $32.97.

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HP reports 13 drop in net profit