HP Inc CEO reports 'breakthrough' quarter as PC sales shoot up
Look at me go, Mum!
For the first time in more than half a decade HP Inc has managed to report quarterly growth in both its PC and printer businesses, a point CEO Dion Weisler described as a watershed moment in the company's recent history.
However, spiralling costs, particularly in Selling, General and Administrative Expenses, meant profits were down for the quarter.
Group sales for Q2 ended 30 April climbed 7 per cent year-on-year to $12.4bn; the Personal Systems division jumped 10 per cent to $7.662bn with commercial and consumer up 7 and 16 per cent respectively. Printing was up 2 per cent to $4.74bn with commercial and consumer up 6 and 3 per cent.
On the up were notebooks sales (17 per cent) to $4.49bn, workstations (3 per cent) to $495m, and commercial and consumer print hardware (3 and 4 per cent respectively) to $982m and $604m. Ink supplies and desktops both dropped.
"This was a breakthrough quarter for HP," said Weisler, "and marks the first time both Personal Systems and Print have grown in the same quarter since 2010."
HP Inc undocked from the mothership in 2015 – the other part of the business became Hewlett Packard Enterprise and does not seem to have flourished in quite the same way for various reasons.
Weisler claimed the last time its PCs generated the same level of sales was three years ago, "triggered by the XP refresh cycle". Corporate customers began upgrading machines in Q4 last year and the activity continued into this year.
The print business is in recovery mode, boosted by sales of the mobile device Sprocket, and share gains for multi-function products and supplies of inventory are more in line with demand.
The cost of revenues was $10bn, up from $9.338bn; selling, general and admin jumped to $1.087bn from $1bn; R&D was up to $314m from $301m; and other charges took total costs and expenses to $11.5bn, up 7.6 per cent.
As such, operating profit dipped to $818m from $841m and after tax, net profit came in at $559m, down from $629m. ®