HP Posts 2Q Profit As Sales Decline

Hewlett-Packard

Pro forma earnings for the quarter ended April 30 were $498 million, or 25 cents per share, in line with Wall Street analysts' consensus estimates and up from $336 million, or 17 cents per share, in the year-ago period. The pro forma results exclude acquisition-related charges, in-process research and development charges, amortization of goodwill and purchased intangibles, restructuring charges and investment losses, HP reported.

"The IT spending environment remains tough around the world," HP Chairman and CEO Carly Fiorina said in a statement. "Weakness in our computing systems business, embedded and personal systems business, and our consulting services business persisted in the second quarter but was offset by solid performance in our imaging and printing and IT outsourcing and support businesses," she said.

Fiorina noted that integration efforts related to the Compaq merger plus the lawsuit filed by former HP board member Walter Hewlett, who tried to block the merger, affected second-quarter results.

"In the final weeks of the quarter, 400 senior managers were named to their assignments in the new HP, and we were involved in a highly visible lawsuit. While there was real potential for distraction, HP delivered," she said.