H-P Earnings: Declining Revenue and Profit Have Shares Down 4%

On top of dropping to a loss in the third quarter, S&P 500 (NYSE:SPY) component Hewlett Packard Co. (NYSE:HPQ) also came in short of analyst estimates. Hewlett-Packard provides products, technologies, software and services to individual consumers, businesses and large enterprises, including customers in the government.

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Hewlett Packard Co. Earnings Cheat Sheet

Results: Reported a loss of $8.86 billion ($4.49 per diluted share) in the quarter. The computers had net income of $1.93 billion or 93 cents per share in the year-earlier quarter.

Revenue: Fell 4.9% to $29.67 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Hewlett Packard Co. fell short of the mean analyst estimate of 97 cents per share. Analysts were expecting revenue of $29.92 billion.

Quoting Management: “HP is still in the early stages of a multi-year turnaround, and we’re making decent progress despite the headwinds,” said Meg Whitman, HP president and chief executive officer. “During the quarter we took important steps to focus on strategic priorities, manage costs, drive needed organizational change, and improve the balance sheet. We continue to deliver on what we say we will do.”

Key Stats:

Revenue has fallen in the past four quarters. Revenue declined 3% to $30.69 billion in the second quarter. The figure fell 7% in the first quarter from the year earlier and dropped 3.5% in the fourth quarter of the last fiscal year from the year-ago quarter.

After beating analyst estimates for the two previous quarters, the company fell short of forecasts. In the second quarter, it topped the mark by 7 cents, and in the first quarter, it was ahead by 5 cents.

The company’s loss in the latest quarter follows profits in the previous three quarters. The company reported a profit of $1.59 billion in the second quarter, a profit of $1.47 billion in the first quarter and $239 million in the fourth of the last fiscal year.

Looking Forward: For the next quarter, analysts are growing pessimistic about the company’s expected results. The average estimate for the fourth quarter is $1.18 per share, dropping from $1.19 a month ago. For the fiscal year, the average estimate has moved up from $4.02 a share to $4.05 over the last sixty days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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