Categories AlphaGraphs, Earnings, Technology

HP reports solid 2Q results, appoints new CFO

HP’s (HPQ) second quarter earnings surged 20% year-over-year to $0.48 per share and was in line with analysts’ expectations. Revenue, which topped Street’s estimates, grew 13% to $14 billion thanks to solid double-digit sales growth on both the PC and Printer divisions.

The PC maker also announced today that Steve Fieler will be donning the role of CFO from July 1, replacing Cathie Lesjak, who will be moving to the role of interim COO. Shares are marginally up in the extended hours of trading.

Personal Systems division, which brings in lion’s share to the company’s top line, continued its strong performance, improving sales by 14.5% to $8.76 billion. It’s worth noting that global PC shipments have been tepid for last few years. Despite the gloomy scenario, HP has been able to grow its PC shipments, thanks to its attention to changing consumer preferences and focusing on high-growth high-margin products for the gaming and commercial market.

Production innovation also benefits its bottom line as it brings in better margins. In the fourth quarter of last year, HP dethroned Lenovo to become the top PC maker based on shipments according to market research firms IDC and Gartner.

HP second quarter 2018 earnings
HP Q2 2018 Earnings Infograph

Printing segment saw 11% growth over last year bringing in $5.2 billion to the top line. To bolster its presence, HP gobbled up Samsung’s printer division late last year for more than $1 billion. The company’s focus on niche high-growth potential domains like A3 and 3D printing domains are expected to augur well to its earnings in the near future.

Margins contracted 0.2% to 8.2% year-over-year due to the impact of the printer division. The imaging unit margins are down 1.3% touching 16%, primarily due to the continued investments and Samsung’s printer division deal. On the flip side, PC segment margins of 3.8%, improved 0.6% due to the continued focus on higher-margin products.

Buoyed by the strong first half results, HP expects its non-GAAP earnings to be between $0.49 and $0.52 per share for the current quarter and in the range of $1.97 to $2.02 per share for the full year, excluding restructuring and other charges.

Hewlett Packard decided to split itself into two companies in latter part of 2015. Post the split, HP (HPQ) and Hewlett Packard Enterprises (HPE) were formed. HP has been having a dream run in the bourses where its stock price has more than doubled after the split. Investors seem to be gung-ho about the HP’s performance over the last couple of years. HP’s stock is up more than 15% over the last 12 months.

Most Popular

Does Unity Software (U) stock has more room to run?

Last month, the IPO market was in a full swing. IPOs of Snowflake (NYSE: SNOW) and JFROG (NASDAQ: FROG) had an impressive opening day in September, the former creating a

PepsiCo (PEP): Steady snacking habits amid pandemic drive strong quarter for beverage giant

PepsiCo Inc. (NASDAQ: PEP) beat market expectations on both revenue and earnings for the third quarter of 2020. The company saw the momentum continue in its snacks business while the

Does the virus-driven boom make Electronic Arts (EA) a good investment?

With more and more people turning to virtual entertainment sources, amid the virus-related movement restrictions, video game publishers like Electronic Arts (NASDAQ: EA) are witnessing unusually high demand. Not surprisingly,


Add Comment
Viewing Highlight