Hewlett-Packard Co reported second-quarter net income that rose a respectable 8% to $784 million, but still fell short of expectations. Revenue for the quarter increased 5% to $10.34bn, with revenue for the computer business also up 5% at $8.5bn. Earnings, which amount to $0.75 per share, couldn’t satisfy the First Call consensus of $0.80, mainly due to a continued slowing of order growth – at only 3% this quarter compared to 24% for the same quarter last year. The company says that efforts to reduce PC and printer inventories in reseller channels was largely responsible for the slowdown. Orders which declined 2% in the US were offset by a 7% growth in foreign markets, including 19% growth in Asia and Latin America. To revitalize growth, the company says it plans aggressive introductions for UNIX system servers, hardcopy products and more offerings in the area of electronic commerce and internet security. Efforts to Integrate UNIX and Windows NT also remain a priority. Midterm net income rose 12% to $1.7 billion on revenue up 8% at $20.64bn. Earnings per share increased 9% to $0.75 for the quarter, and 13% to $1.62 for the six months. EPS figures reflect the effect of the company’s 2-for-1 stock split in July 1996.
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