logo
  Join        Login             Stock Quote

Hewlett-Packard (HPQ) 2Q Earnings Top View, To Cut 27,000 Jobs; Shares Jump

 May 23, 2012 04:16 PM
 


(By Balachander) Hewlett-Packard Co. (NYSE:HPQ) shares jumped 6.45 percent in extended trading after the PC maker reported better-than-expected quarterly earnings, and said it would cut 8.0 percent of its workforce or roughly 27,000 jobs. The company also raised its full-year forecast.

HP sees a pre-tax charge of about $1.7 billion in fiscal 2012 as a result of this restructuring, which should help the company to focus on segments that offer attractive growth potential.

On a non-GAAP basis, earnings per share (EPS) fell 21 percent to $0.98 from $1.24 in the same period of last year, yet topped Wall Street projections of $0.91. GAAP earnings fell 31 percent to $1.6 billion.

Revenue declined 3 percent to $30.7 billion, versus consensus estimate of a 5.4 percent decline to $29.92 billion for the second quarter.

HP's revenue has been falling for the past two quarters as dwindling sales of PCs coupled with a shortage of hard disk drives (HDD) taking a toll on its results.

The announcement of job cuts will be the biggest step taken by CEO Meg Whitman, who took the helm in September 2011 after HP abruptly ended the 11-month tenure of her predecessor, Leo Apotheker.

Segment wise, Personal Systems Group revenue was flat with desktop units rising 5 percent, while notebook units fell 6 percent. Services revenue fell 1 percent. Imaging and Printing Group (IPG) revenue dropped 10 percent and Enterprise Servers, Storage and Networking (ESSN) revenue fell 6 percent. Software revenue jumped 22 percent.

Looking ahead for the third quarter, HPQ forecasts non-GAAP EPS between 94 cents and 97 cents, below analysts' expectations of $1.02.

For the full year, the company now expects non-GAAP EPS in the range of $4.05 to $4.10, up from prior view of at least $4.00, while analysts expect $4.03. 

According to market research firm Gartner, HP's first quarter 2012 market share grew to 17.2 percent up from 15.4 percent in the fourth quarter of 2011.

The stock, which has been trading in the 52-week range between $20.57 and $21.20, ended Wednesday's regular trading at $21.08.
iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article image3 US Updates Show Ongoing Growth

Three economic updates today provide more evidence that moderate growth endures for the US. The numbers du read on...

article imageBuy These Solar Stocks Before They Snapback

Sometimes the market hands you a gift. And it would be foolish not to take it. Thanks to general market read on...

article imageInvestors Are Even More Euphoric And Confident.

As noted on the blog last Thursday, even though the market had been down for three straight weeks, last read on...

article imageThe Butterfly Machine

There’s a phenomenon called the Butterfly Effect. One common quotation is “It has been said that something read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.