HP in the black despite product sales slump

Hurd: we are confident that HP will be an early beneficiary of the economic turnaround

Despite a drop in revenue and profit, HP still banked £1bn in its fiscal third quarter as chief executive Mark Hurd claimed "business is stabilising".

The PC giant posted global sales of $27.5bn (£16.7bn) in the three months to the end of July, down two per cent on the same period last year. Net profit, based on generally accepted accounting principles, slipped 19 per cent to $1.6bn.

But, as in the preceding quarter, hardware and software sales took a pasting in Q3. Storage and server revenue dropped 23 per cent to $3.7bn and software sales fell 22 per cent to $847m.

PC revenue slipped 18 per cent to $8.4bn, despite a two per cent hike in shipments which kept HP as the world's top manufacturer. Imaging and printing revenue fell by a fifth to $5.7bn.

HP's financial services arm fared somewhat better, as revenue declined one per cent to $670m. Services was the one bright spot, with revenue rising 93 per cent, predominantly off the back of the vendor's acquisition of EDS last year.

EMEA revenue for the quarter fell four per cent to $9.9bn, while sales in Asia Pacific fell by the same percentage to $5bn. HP enjoyed more success in the Americas, where revenue jumped eight per cent to $12.6bn.

Hurd said: “HP’s performance this quarter is a result of our strong business portfolio, efficient cost structure and scale. We made positive gains in extending our market leadership in key segments and strengthening our competitive position.

"Business is stabilising, and we are confident that HP will be an early beneficiary of an economic turnaround and will continue to outperform when conditions improve."