Hewlett-Packard Co. cut its forecast for full-year profit, evidence of lackluster demand for personal computers and business-technology services and underscoring the turnaround challenge facing chief executive officer Meg Whitman.
Profit excluding certain costs will be US$4.05 to US$4.07 a share in the year that ends in October, the Palo Alto, California-based company said today in a statement. That?s at the low end of a forecast for US$4.05 to US$4.10 issued in May and below the average US$4.08 analyst estimate compiled by Bloomberg. Profit excluding costs was US$1 a share and sales were US$29.7-billion in the third quarter, matching analysts? predictions.
Under Whitman, the largest personal computer maker is stepping up investment in research and development and revamping its PC, printer and enterprise-services groups to crank out more compelling products. Sales growth has stalled as competitors such as Apple Inc. siphon off demand for computing devices and rivals including International Business Machines Corp. vie for corporate customers.
?Slowly all of their business are being commoditized,? said Abhey Lamba, an analyst at Mizuho Securities USA Inc. in New York.
Third-quarter revenue fell in the divisions that sell PCs, printers and services. Sales also declined in the servers, storage and networking unit. Software climbed 18%.
In services, IBM has emulated the more efficient models of rivals such as Wipro Ltd. and Tata Consultancy Services Ltd. by staffing up in India, said Lamba, who has a neutral rating on the shares. Hewlett-Packard hasn?t done so, he said.
Job Cuts
Whitman, who?s striving to gird against competitive threats from companies including Apple Inc., is cutting 27,000 jobs over two years and plans to invest in areas including security, cloud computing and data-analysis software. She?s also dismantling the acquisitions of Electronic Data Systems Corp. and Palm Inc., which were made by Mark Hurd, who was CEO from 2005 to 2010.
Shares had declined 3.7% to US$19.20 at the close, and have fallen 25% this year, compared with a 26% increase in the Standard & Poor?s 500 Index.
The company had said on Aug. 8 that third-quarter profit would be US$1 a share. The company also said at the time that it would write down the value of its enterprise-services business by US$8-billion, and take a higher-than-expected US$1.5-billion to US$1.7-billion charge for early retirement packages offered to workers.
Bloomberg.com
Source: http://business.financialpost.com/2012/08/22/hp-slashes-full-year-forecast-as-pc-sales-stall/
snapdragon kim jong ill dead wedding crashers next iron chef next iron chef aquamarine iraq war
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.