Hewlett-Packard continued to suffer from a slow down in technology
spending in its third fiscal quarter, posting a fall in revenue.
HP generated $16.5bn (£10.8bn) in revenue for the quarter ending 31
July, compared with $18.6bn for the same quarter a year ago, and
posted a $2bn (£1.3bn) net loss for the quarter.
HP made its first earnings announcement since completing its
acquisition of Compaq Computer in May. The financial results
provided by HP reflected the combined company's earnings, counting
Compaq's prior fiscal quarter results as if they were combined with
HP at the start of its prior fiscal quarters, according to the
statement.
HP took a $1.6bn (£1.04bn) charge in the quarter for restructuring,
a $735m charge for research and development, a $322m charge for
merger-related retention and a $340m charge for other
merger-related items.
Sales slowed in all regions for HP compared with the same quarter
last year. Revenues dropped 6% in the US, 10% in the Americas, 11%
in Europe and 15% in the Asia/Pacific region, said HP chairman and
chief executive Carly Fiorina.
The company has reduced its workforce by 4,740 employees and said
it remains on track to make 10,000 job cuts by the end of its
fiscal year.
The company's lucrative imaging and printing business showed a 10%
revenue increase year on year to $4.7bn. This segment includes
printers, digital cameras and other similar equipment.
HP's personal systems business, which includes PCs, notebooks,
workstations and handheld devices, fell 19% year on year to $4.8bn
(£3.1bn). Consumer PC revenue fell 20% compared with last year, and
commercial PC revenue tumbled 15%. The company cited intense price
competition and lack of demand as a result of the declines in its
statement.
HP's enterprise systems business did not fare much better as
revenue tumbled 22% year on year. The company generated $3.8bn in
revenue from its servers, storage systems and software included in
this segment.
HP lost ground to competitors in sales of Unix servers, despite
shipments of its high-end Superdome server increasing by 9%. The
company plans to bring its hardware businesses back to
profitability next year, said Michael Capellas, president of HP.
Its services operations revenue also fell in the quarter, down 7%
year on year to $3bn.