HP Inc. (HPQ) on Wednesday reported a drop in profit for the first quarter hurt largely by a 12 percent drop in revenues as the company continues to struggle with weak demand for PCs and printers. The computer and printer maker reporting its first quarterly results after splitting into an independent company reaffirmed its full-year financial guidance.
HP's first-quarter profit dropped to $592 million or $0.33 per share from $1.37 billion or $0.73 per share last year. Excluding one-time items, adjusted earnings for the quarter were $0.36 per share, down from $0.41 per share last year.
Revenues for the quarter dropped 12 percent to $12.2 billion from $13.9 billion last year. On a constant currency basis, revenues were down 5 percent.
Last year, HP separated into two independent companies Hewlett Packard Enterprise Co. (HPE) and HP Inc. - in an effort to curb costs improve its sluggish sales. Hewlett Packard Enterprise, with more than $50 billion in annual revenue, will provide the technology solutions, while HP Inc. will be supplying PCs and printers.
Personal Systems revenue dropped 13 percent, as PC industry as a whole continues to see poor demand as consumers continue to switch to smartphones and tablets. HP said printing revenue dropped 17 percent, with supplies revenues down 14 percent and hardware unit sales declining 20 percent.
Looking forward to the second quarter, HP expects adjusted earnings of $0.35 to $0.40 per share. For the full-year 2016, HP continues to see adjusted earnings of $1.59 to $1.69 per share.
Hewlett Packard Enterprise is scheduled to report its quarterly earnings on March 3.
HPQ closed Wednesday's trading at $10.82, up $0.51 or 4.9%, on the NYSE. The stock further gained $0.06 or 0.55% in the after-hours trade.
by RTT Staff Writer
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