updated 05:30 pm EST, Mon November 23, 2009
HP Q3 2009 shipments up, revenue down
HP this afternoon revealed mixed results for its quarter ended in October. The company's net earnings climbed 14 percent year-over-year to $2.4 billion, but its revenue dropped by 8 percent to $30.8 billion in the same time frame. It credits the profit boost to cost-cutting measures but saw its revenue drop across the board in every category, including the Personal Systems Group that handles its common PC business.
The division shipped 8 percent more PCs than a year earlier, enough to keep its lead in market share, but suffered directly from a heavy dependence on budget PCs such as netbooks. Its revenue dropped 12 percent from year-to-year to $9.9 billion, and its profit dropped a sharp 25 percent to $460 million. Desktops took the deepest hit as revenue for the category fell 16 percent where the notebook category, which includes netbooks, dropped a softer 8 percent.
The Palo Alto-based firm also warned of further declines in the fall. Although higher than analyst predictions, it expects its revenue to decline again to between $29.6 billion and $29.9 billion and its relative profit per share to drop as well.
HP's success in market share is widely attributed to its strong presence at retail with economy notebooks and desktops but has also increasingly counted on its Mini netbook range. This includes carrier deals such as with AT&T and Verizon that subsidizes the portables to an even lower price, albeit at the networks' expense.
Contrasting against the results is Apple, which posted sharp increases in both areas based both on the rise of its iPhone business as well as its emphasis on lower-volume but more profitable Mac sales. It forecasts both an increase in revenue and a disproportionately larger profit.