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HP grows sales but misses earnings targets

Full year sales up 15% to $48.8bn

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HP brought home $13.3 billion in its fourth quarter, but decided to can negotiations with Price Waterhouse Coopers to buy its consulting division.

The figure represents a 17 per cent rise on the $11.4 billion it turned over in the same period last year. Earnings per share fell short of the company's targets and only rose by 14 per cent to 45 cents per share. Company president, Carly Fiorina, said that she accepted full responsibility for the shortfall.

Of the $13.3 billion, $6 billion was generated in the US, and $4.5 billion in Europe. The remainder was spilt between Latin America and the Asia Pacific region.

Over the full year, HP reported net revenue of $48.8 billion - up 15 per cent on the year before.

Within the company, the most improved section was notebooks, which grew 164 per cent in revenue terms on the year before.

In the computer systems division as a whole, HP grew revenues by 29 per cent year on year. UNIX server revenues rose 23 per cent and orders of low and mid-range servers were up 43 per cent. PC revenues grew by 40 per cent.

Revenue from scanner and printer sales rose six per cent on last year. Nearly 12 million units shipped during the quarter.

IT Services gained 15 per cent on last year's figures. The consulting business's income went up 46 per cent.

On the decision to halt negotiations with PwC, Fiorina said that although she still believed it was a sound business proposition, the protracted negotiations were a distraction from HP's main business. She was not confident that the company would be able to "satisfy our value creation and employee retention objectives."* ®

*Especially if she keeps shrinking the cubicle sizes - see story by Andrew Thomas.

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