HP Net Profit Up 5%

Nov. 23, 2010
Revenue increased 10% in the Americas to $15.1 billion, was up 6% in Europe, the Middle East and Africa to $12.4 billion and rose 8% in Asia-Pacific to $5.8 billion.

Hewlett-Packard plans to increase its focus on software, new chief executive Leo Apotheker said Nov. 22, as the computer giant posted fourth quarter results that topped Wall Street's expectations.

HP said net profit rose 5% in the fourth quarter of its financial year to $2.5 billion while revenue was up 8% to $33.3 billion, better than the $32.75 billion expected by analysts.

"HP proved once again that it is able to execute given its market strengths and technology leadership," said Apotheker, who took over as HP's president and chief executive on November 1 after former CEO Mark Hurd's abrupt resignation.

HP said revenue increased 10% in the Americas to $15.1 billion and was up 6% in Europe, the Middle East and Africa to $12.4 billion. Revenue rose 8% in Asia-Pacific to $5.8 billion.

HP said it expected revenue of $32.8 billion to $33 billion in the current quarter.

Revenue from HP's services business rose 0.4% in the quarter to $9 billion while revenue from its storage and servers business for the enterprise market was up 25% to $5.3 billion.

Software revenue increased 1% to $974 million.

Apotheker, the former chief executive of German business software giant SAP, said that he planned to increase emphasis on software. "We all feel we need to have a strong and viable software business," he said. "It is true that today software represents roughly 3% of our revenue but I think we can do a lot better.

"Doubling it wouldn't be too bad, tripling it would be even better but that would be a very, very, very long term projection," he said.

"With software we can add a lot of value in our strengths to whatever we do for our customers. That doesn't mean we would be in any type of software business," he said. "We have focus in our software strategy."

HP said revenue rose 4% to $10.3 billion at its Personal Systems Group, which makes desktop, notebook and other computers. Notebook revenue was down 3% while desktop revenue increased 13%.

HP said commercial client revenue rose 20% while consumer client revenue was down 10%.

Revenue was up 8% to $7 billion at HP's imaging and printing group.

In the conference call, Apotheker referred only briefly to the case filed against SAP by rival Oracle in a California court. "Given the strength and momentum of our business and our strong competitive position in the industry a competitor has tried to distract us -- and you -- from the good work being done across HP's business," he said. Oracle had been seeking to have Apotheker testify in the case, in which Oracle has accused an SAP subsidiary of stealing Oracle software, but was reportedly unable to serve him with a subpoena.

Copyright Agence France-Presse, 2010

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!