HP Profit Dives as Whitman Positions for a Turnaround
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HP is starting off its fiscal 2012 year on a down note financially. HP reported first-quarter fiscal 2012 earnings late Wednesday with declining revenues and income.
For the quarter, HP reported net revenues of $30.0 billion, which is a 7 percent year-over-year decline. Net earnings were reported at $1.5 billion, a 44 percent year-over-year decline.
"Frankly, it was a tough quarter, and every business had its challenges," HP CEO Meg Whitman said during the company's earnings call.
Whitman noted that back in November, HP set the outlook for 2012. At that time, it noted there were likely to be a number of challenges, including the hard drive shortage and an uncertain macroeconomic environment.
"The headwinds we discussed did impact performance, contributing to a decline in revenues, operating margins, cash flows and earnings year-over-year," Whitman said.
HP's Business Critical Systems (BCS) division was particularly hard hit with revenue declines of 27 percent year-over-year, even though some server classes actually grew.
"Within BCS, our mission-critical x86 and NonStop products grew double digits, but not by enough to counteract the impact of continuing Itanium challenges," HP CFO, Catherine Lesjak said.