HP Partner Push Pays Off

HP&'s revenue for the quarter ended July 31 totaled $20.8 billion compared with $18.9 billion for the same period last year. Net income was $73 million or 3 cents per share, down from the year-ago figures of $586 million and 19 cents per share. The Palo Alto, Calif., company&'s earnings were impacted by a one-time U.S. income tax provision of about $788 million on $14.5 billion repatriated to the United States from foreign operations.

Enterprise Storage and Server (ESS) operating profits jumped to $150 million in HP&'s third quarter, compared to a $211 million loss in the comparable 2004 quarter. Revenue for the unit reached $4 billion compared to $3.3 billion a year earlier.

HP&'s president and CEO Mark Hurd said that the ESS business was aided by a stronger alignment with enterprise VARs. HP in July announced a plan to further align select enterprise VARs in the United States with HP&'s Technology Solutions Group direct sales force.

Following last week&'s earnings report, Hurd reiterated his intention to have HP work more closely with solution providers who sell complete HP solutions. “We continue to have high expectations of our ability to work with the channel,” he said. “Some of our channel partners had good, strong quarters. We are encouraged by that. As I&'ve said before, we are looking for the partners that really want to partner with HP and really focus with us in a big way and those are the ones we are going to spend a lot of effort with.”

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Don Richie, president of Sequel Data Systems, an HP enterprise solution partner in Austin, Texas, said his HP business for the quarter ending Sept. 30 will likely increase close to 20 percent compared to a year ago.

“HP has refocused back on storage and we are certainly seeing the benefits of that,” he said. “We&'ve seen people in upper HP management supporting us in customer calls and other things. Before [it] would have been like pulling teeth to get support.”

HP also is more willing to fund storage and server marketing campaigns and is revitalizing storage incentives, Richie said.