Hewlett-Packard Company (NYSE: HPQ), the world's largest PC maker, is scheduled to release its fiscal first-quarter financial results after the closing bell on Tuesday, February 22, 2011. Analysts, on average, expect the company to report earnings of $1.29 per share on revenue of $32.96 billion. In the year ago quarter, the company reported earnings of $1.07 per share on revenue of $31.18 billion.
Hewlett-Packard Company offers various products, technologies, software, solutions, and services worldwide. Hewlett-Packard Company (HP) is a global provider of products, technologies, software, solutions and services to individual consumers, small- and medium-sized businesses (SMBs) and large enterprises, including customers in the government, health and education sectors.
In the preceding fourth quarter, the Palo Alto, California-based company's net income was $2.5 billion, or $1.10, compared with a profit of $2.4 billion, or 99 cents a share, in the year-ago quarter. On an adjusted basis, the company earned $1.33 per share in the latest quarter. Revenue increased to $33.3 billion from $30.8 billion. Analysts, on average, expected the company to report earnings of $1.27 per share on revenue of $32.75 billion.
At its last earnings call in November, the company said that it expects fiscal first quarter revenue of approximately $32.8 billion to $33.0 billion, GAAP EPS in the range of $1.06 to $1.08, and non-GAAP EPS in the range of $1.28 to $1.30. First quarter fiscal 2011 GAAP and non-GAAP EPS estimates include a one-time gain of approximately $0.04 per share primarily related to the disposition of real estate. First quarter fiscal 2011 non-GAAP EPS estimates exclude after-tax costs of approximately $0.22 per share, related primarily to the amortization of purchased intangibles, restructuring charges and acquisition-related charges.
The company also raised its full-year 2011 outlook. HP said that it now expects full year fiscal 2011 revenue in the range $132 billion to $133.5 billion, GAAP EPS in the range of $4.42 to $4.52, and non-GAAP EPS in the range of $5.16 to $5.26. GAAP and non-GAAP EPS includes a one-time gain of approximately $0.04 per share primarily related to the disposition of real estate. Full year fiscal 2011 non-GAAP EPS estimates exclude after-tax costs of approximately $0.74 per share, related primarily to the amortization of purchased intangibles, restructuring charges and acquisition-related charges. Previously, the company anticipated fiscal year 2011 revenue in the range of $131.5 billion to $133.5 billion, GAAP EPS of $4.35 to $4.45 and non-GAAP EPS of $5.05 to $5.15 per share.
The company has a strong business model, and still rules the computing world, with a leadership position in both PC and Server segments. Hewlett-Packard is also well positioned to challenge networking leader Cisco Systems Inc. (NASDAQ: CSCO), and gain share in the networking market.
The company has benefited from improving trends in printing and buoyant spending from companies that are updating aging personal computers and servers. According to technology research firm Gartner, worldwide PC shipments totaled 93.5 million units in the fourth quarter of 2010, a 3.1 percent increase from the fourth quarter of 2009.
HP still has several solid product platforms. Recently, Hewlett-Packard Co. lifted the wraps on a new tablet and smartphones based on the webOS operating system, which the company inherited with last year’s acquisition of Palm Inc. for $1.2 billion. At an event in San Francisco, H-P announced the TouchPad tablet, as well as the Pre3 and Veer smartphones. The TouchPad is expected to ship sometime this summer.
Forecasts for tablets are big. According to iSuppli, global shipments of such devices are expected to reach more than 240 million in 2015 — up 12-fold from today’s numbers. Another market-research firm, DisplaySearch, predicts tablet shipments will hit 55.7 million units this year, likely eating into sales of PC products such as laptops. However, a potential problem for H-P is that tablets are also seen cannibalizing segments of the PC market — particularly low-end notebooks. Given the lead of other players, some analysts also expect a rough road ahead for Hewlett-Packard in the tablet sector. According to Gartner, tablet devices are expected to displace around 10% of personal-computer shipments by 2014, emerging as a leading disruptive factor for PC growth.
Of late, H-P has relied on acquisitions to strengthen its business and broaden its product offerings. The company recently agreed to acquire Vertica, a privately held, real-time analytics platform company based in Billerica, Massachusetts. The company said that the acquisition of Vertica would enhance HP capabilities for information optimization, adding sophisticated, real-time business analytics for large and complex sets of data in physical, virtual and cloud environments.
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