Buoyed by a sharp improvement in its software business, Hewlett-Packard Co. reported a quarterly profit on Monday.
The company reported net earnings of US$2.3 billion, or US$0.86 per share, for the fourth quarter ending Oct. 31, compared to net income of US$1.9 billion for the year-earlier quarter. Earnings beat the estimates made by Thomson Financial analysts, who projected net income of US$2.184 billion and US$0.82 earnings per share.
HP recorded fourth-quarter net revenue of US$28.3 billion for the quarter, a 15 per cent year-over-year increase.
The company took a US$30 million charge related to licensing its manufacturing, distribution and design of HP cameras so that it can concentrate on its home photo printing and online photo services.
Net revenue for fiscal 2007 was US$104.3 billion, a 10 per cent growth year-over-year. HP recorded operating profit of US$9.6 billion.
The company’s software revenue doubled year-over-year to US$698 million, said Mark Hurd, CEO and president of HP in a conference call following the earnings announcement. Hurd attributed the software rise partly to the acquisition of Mercury Interactive, which HP acquired for US$4.5 billion last year.
The growth reflected strong operational performance of the OpenView and Mercury software businesses, said Cathie Lesjak, executive vice-president and CFO at HP, during a separate analyst conference call. For fiscal 2008, HP software revenue was US$2.3 billion, making it the sixth largest software company in the world, Hurd said in the call.
Notebook revenue grew 49 per cent year-over-year, with more people using mobile devices to access digital content, Hurd said. The world is going mobile, especially in emerging markets, he said.
Revenue for HP’s Personal Systems Group topped the US$10 billion mark during the quarter, a 30 percent year-over-year increase, Lesjak said. PC unit shipments went up 31 percent.
Hurd was pleased with 78 per cent growth in x86 blade servers revenue, he said. The Enterprise Storage and Servers group reported revenue of US$5.2 billion, a 10 per cent increase over the previous year.
Though storage revenue grew seven percent year-over-year, there is more room for HP to grow in the space, Hurd said. In the Imaging and Printing Group, consumer hardware revenue declined five per cent year-over-year due to declines in appliance printers and camera shipments, Lesjak said. Total printer hardware unit shipments were up five per cent year-over-year, which is slower than recent periods, Lesjak said.