Feeds

HP says 'turnaround remains on track', cuts thousands of workers

11,000 to 16,000 more jobs to go at Whitman's IT dream factory

Business security measures using SSL

HP has handed in a tepid set of financial results with a surprise note saying it expects to lay off even more employees, as the company trudges down an unknown path into a new IT world.

The company reported revenue of $27.3bn and earnings per share of $0.88 on Thursday, meeting analyst earnings expectations but narrowly missing the $27.41bn predicted revenue mark.

This compared with $27.58bn in the same quarter a year ago, and $0.90 per share and revenue of $28.2bn in its previous quarter.

Net earnings were $1.27bn for the quarter, compared with $1.08bn a year ago and $1.425bn in the previous quarter.

"With the first half of our fiscal year completed, I'm pleased to report that HP's turnaround remains on track," said HP's chief Meg Whitman in a canned statement. "With each passing quarter, HP is improving its systems, structures and core go-to-market capabilities. We’re gradually shaping HP into a more nimble, lower-cost, more customer- and partner-centric company that can successfully compete across a rapidly changing IT landscape."

One method of helping it compete is layoffs, and HP announced that it will cut a further 11,000 to 16,000 staff from its workforce on top of the 34,000 layoffs it had already anticipated.

HP reckons it will report EPS of between $0.86 and $0.90 next quarter.

Shares fell by around 2 per cent after the results were published, then traded down a further 1 per cent after the market closed.

Last quarter, HP grew personal PC sales for the first time in seven financial reporting periods, and this quarter it continued that trend, with revenue up 7 per cent year-over-year. That improvement was driven by growth in commercial revenue but tempered by a two per cent sag in consumer systems. Revenues for the division were $8.176bn.

The other divisions didn't fare as well. Printing had just a small decline, with revenues falling to $5.834bn from $6.094bn a year ago. Things were grim in HP's higher-margin data center hardware group, though, which reported revenues of $6.657bn, down 2 per cent year-over-year. Storage revenue was down 6 per cent while sales of industry-standard servers were up 1 per cent.

The decline in HP's predominantly Itanium-based "Business Critical Systems" division continued, with the group shrinking a further 14 per cent versus the same quarter a year ago.

Enterprise Services shrank by 7 per cent to $5.7bn. Software revenue was flat year-over-year ($971m versus $967m a year ago) with licenses ticking up but support revenues ticking down. HP financial services fell by 2 per cent to $867m.

During the quarter, HP made a number of strategic moves designed to offset trouble in its key server business. These included a manufacturing partnership with Asian equipment maker Foxconn to create low-cost servers and a redoubling of efforts to maintain good relationships with its thousands of channel partners in an apparent effort to motivate them to sell more of its HP gear and come into fewer conflicts with its own mammoth sales organization.

The company also launched HP Helion, a brand-new cloud strategy that hinges around the open source cloud management framework OpenStack, as it sought to take cloudy cash away from rivals like Amazon, Google, and Microsoft.

These are early initiatives, but show HP is trying to make a change, despite being buffeted by a grim IT market that has no respect for the giants of past decades. ®

Reducing the cost and complexity of web vulnerability management

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Protecting users from Firesheep and other Sidejacking attacks with SSL
Discussing the vulnerabilities inherent in Wi-Fi networks, and how using TLS/SSL for your entire site will assure security.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.