Wednesday, August 24, 2016

HP Inc forecasts weak profit on low demand for printers

The Hewlett-Packard (HP) logo is seen as part of a display at the Microsoft Ignite technology conference in Chicago, Illinois, May 4, 2015. REUTERS/Jim Young/File Photo
The Hewlett-Packard (HP) logo is seen as part of a display at the Microsoft Ignite technology conference in Chicago, Illinois, May 4, 2015. REUTERS/Jim Young/File Photo


HP Inc (HPQ.N) forecast fourth-quarter profit below analysts' estimates as the company, which was split off from the former Hewlett-Packard Co, struggles with weak demand for its printers. HP shares fell 5 percent to $13.68 in extended trading on Wednesday. The company forecast adjusted earnings of 34-37 cents per share from continuing operations for the current quarter. Analysts on average were expecting 41 cents per share, according to Thomson Reuters I/B/E/S. HP, however, reported higher-than-expected profit and revenue for the third quarter as demand recovered for its personal computers. Revenue from HP's computer business was $7.51 billion, flat from a year earlier as weak demand from commercial clients offset higher sales of notebooks.

From the second quarter, however, revenue jumped 7.5 percent in the business, which accounts for nearly two-thirds of the company's total revenue. Revenue from its printer business declined 14.3 percent. HP's net earnings from continuing operations rose more than a fifth to $843 million, or 49 cents per share, in the quarter ended July 31. Excluding items, HP earned 48 cents per share, beating the average analyst estimate of 44 cents. Total revenue fell 3.8 percent to $11.89 billion, but topped the average estimate of $11.46 billion.
(Reporting by Aishwarya Venugopal in Bengaluru; Editing by Kirti Pandey)
This article was first seen on Reuters