Hewlett-Packard Co is getting back into the saddle again, reporting third-quarter net income up 37% at $853m, including $60m in separation costs from the Agilent business spin-off, compared with $621m last year on revenue which grew 11% to $12.1bn from $11bn a year ago. Earnings per share were $0.81; without the charges it would have reached $0.85, five cents better than the consensus of analysts’ estimates. Numbers for the nine months show how HP has been suffering; net income was up 22% at $2.7bn compared with $2.23bn on revenue up 5% at $36.5bn compared with $34.8bn.
Chief financial officer Bob Wayman told analysts on a conference call that HP executed very well on many fronts, during the quarter, adding that the work isn’t over but we feel better about revenue growth. US revenue rose 8% in the quarter to $5.6bn – after remaining flat for the entire first half – while non-US revenue rose 14% to $6.6bn. In Europe, revenue was up 13% at $4bn while Asia/Pacific revenue increased 24% to $1.7bn. Computer business and imaging revenue – including printers – was up 12% at $10.3bn.
The Agilent Technologies business, which yesterday filed for an IPO, saw revenue at $1.9bn up 8%. It saw revenues of $1bn from test and measurement, up from $970m last time; $376 in healthcare was up from $331m; $284m in semiconductors up from $273m; and $260m from chemical analysis from $225m last time. HP said the cost of spinning out Agilent amounted to roughly $60m in the quarter. Wayman said it is possible that by the end of the fourth quarter, HP may be able to report the Agilent business separately as discontinued operations.
Revenue from commercial PC sales fueled the growth, and notebooks and PC servers – a weakness last quarter – were strong. It grew technical workstation revenue, while revenue from Unix server sales appears to be on the growth curve once more now that the new mid-range N-Class is shipping in volume. Wayman claimed HP’s worldwide PC market share rose to 6.6% from 6.2% the prior quarter on the strength of a 36% rise in overall shipments. Ending its reseller agreement with EMC Corp meant storage revenue tanked, but enterprise software sales especially demand for its OpenView products increased significantly, it says.
Mission critical support and outsourcing business was healthy but there was a weaker demand for consulting. Printing and imaging sales grew in double digits compared with last year. Looking ahead, Wayman declined to provide specific guidance for the fourth quarter, although he did say that during the third quarter, overall orders grew faster than revenue. รก
