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Earnings Roundup

Hewlett-packard

Profit falls on weak PC sales

August 19, 2009|Times Wire Reports

Hewlett-Packard Co.'s profit dropped 19% in the latest quarter, dragged by ongoing weakness in sales of personal Scomputers and printer ink.

The Palo Alto company reported Tuesday that consumer spending on PCs was improving, and that business in China was particularly good.

Because of the recession, 2009 is shaping up to be the worst year in nearly a decade for the PC industry.

HP, the world's No. 1 personal computer maker, has been branching out aggressively into other areas such as technology services and computer networking, but the PC business still makes up nearly a third of its revenue.

Sales in the company's PC business eroded 18% in the three months ended July 31, even as the number of units sold rose 2%.

HP reported after the market closed that it earned $1.64 billion, or 67 cents a share, in the fiscal third quarter. A year earlier the company made $2.03 billion, or 80 cents a share.

Excluding one-time items, HP earned 91 cents a share, a penny better than the average estimate of analysts polled by Thomson Reuters.

Sales fell 2% to $27.45 billion, slightly ahead of analysts' projections for $27.26 billion.

Revenue from printing supplies was down 13%. One of those supplies, printer ink, has long been one of HP's biggest moneymakers, but has been facing competition from generic, cheaper brands.

HP shares were down 96 cents to $43 in extended trading after closing up 85 cents, or 2%, at $43.96.

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