HP CEO Meg Whitman had pleaded for patience following the technology giant’s latest financial results, which revealed a 7% fall in revenue and a 44% decline in profits.
The company’s first quarter 2012 results, for the quarter ended January 31, 2012, saw net revenue fall from $32.3bn a year ago to $30bn this time, a decline of 7%.
Profit at HP fell from $2.6bn a year ago to $1.5bn this quarter, a decline of 44%.
HP’s Personal Systems Group (PSG) reflected the general slowdown in hardware spending across the world – with the exception of Apple devices, it seems – as businesses and consumers continue to feel the pinch of economic uncertainty.
In total PSG revenue fell 15% year on year commercial client revenue declined 7%, consumer client revenue declined 25% and workstations revenue was flat.
Total units were down 18%, with a 19% decline in desktop units and an 18% decline in notebook units. In total revenue from the PSG came in at $8.9bn compared to $10.4bn this time last year.
It was of course PSG that former CEO Leo Apotheker wanted to get rid of to enable HP to focus on software and services. He was fired shortly after announcing the spin-off. New CEO Whitman scrapped the plan shortly after taking over.
However these results suggest Apotheker may have been on the right lines with his plan. As well as the slump in PC sales, revenue from HP’s Enterprise Servers, Storage and Networking (ESSN) division also fell 10% year over year to a shade over $5bn, down from $5.6bn last year.
HP’s Software group saw revenue climb 30% year over year to $946m. That division was boosted by the results of Autonomy, bought by Apotheker for just over $10bn during his ill-fated reign at HP. The Services group also saw a slight rise in revenue.
Whitman, who used to run online auction house eBay, said that the flooding in Thailand which disrupted hard drive protection for many companies was partly to blame for the fall in hardware sales.
She also said that HP is going through a transition that may take many years to materialise, and that results could be disappointing for the foreseeable future.
"Frankly, it was a tough quarter and every business had its challenges," she said during a conference call. "If you look at business history and you look at companies who have gone through the kind of turnaround that we’re leading HP through right now, these things are not quick."
Whitman added that revenue for 2012 is expected to remain flat before rebounding in 2012.
