/// HP’s Q2 Earnings Beat Expectations on Weak Sales

May 22, 2013  |  All Things Digital


Quarterly results from Hewlett-Packard just crossed the wires and they’re better than expected on the bottom line, but weaker on the top. Per-share earnings were 87 cents, down 4.4 percent from a year ago on sales of $27.6 billion, which amounts to a decline of 10 percent from last year. The results are better than the consensus view of analysts, which had called for EPS of 81 cents on revenue of $28.12 billion. The company said it expects to earn between 84 and 87 cents per share in the current quarter and to earn between $3.50 and $3.60 per share for the full year. For the third quarter of fiscal 2013, HP estimates non-GAAP diluted EPS to be in the range of $0.84 to $0.87 and GAAP diluted EPS to be in the range of $0.56 to $0.59. Third-quarter fiscal 2013 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $0.28 per share, related primarily to the amortization of purchased intangible assets, restructuring charges and acquisition-related charges. HP shares are rising in after-hours trading. As of 4:17 PM New York Time, they were at $23.78, up 12 percent from the close of today’s regular trading session. Here’s HP’s original announcement. PALO ALTO, CA–(Marketwired – May 22, 2013) – HP (NYSE: HPQ) Second quarter non-GAAP diluted earnings per share of $0.87, down 11% from the prior year, above previously provided outlook of $0.80 to $0.82 per share Second quarter GAAP diluted earnings per share of $0.55, down 31% from the prior year, above previously provided outlook of $0.38 to $0.40 per share Second quarter net revenue of $27.6 billion, down 10% from the prior year and down 9% when adjusted for the effects of currency Cash flow from operations of $3.6 billion, up 44% from the prior year Returned $1.1 billion in cash to shareholders in the form of dividends and share repurchases Improved operating company net debt position by $1.8 billion, the fifth consecutive quarterly reduction of over $1 billion Declared a regular quarterly cash dividend of 14.52 cents per share on the company’s common stock Information about HP’s use of non-GAAP financial information is provided under “Use of non-GAAP financial information” below. HP today announced financial results for its second fiscal quarter ended April 30, 2013. Second quarter GAAP diluted earnings per share (EPS) was $0.55, down from $0.80 in the prior-year period and above its previously provided outlook of $0.38 to $0.40 per share. Second quarter non-GAAP diluted EPS was $0.87, down from $0.98 in the prior-year period and above its previously provided outlook of $0.80 to $0.82 per share. Second quarter non-GAAP earnings information excludes after-tax costs of $621 million, or $0.32 per diluted share, related to restructuring charges, amortization of purchased intangible assets and acquisition-related charges. For the second quarter, net revenue of $27.6 billion was down 10% year over year and down 9% when adjusted for the effects of currency. “We beat the upper end of our non-GAAP diluted EPS outlook for the quarter by $0.05 per share, driven by better than expected performance in Enterprise Services and Printing, coupled with the accelerated capture of restructuring savings and improvement in our operations,” said Meg Whitman, HP president and chief executive officer. Outlook For the third quarter of fiscal 2013, HP estimates non-GAAP diluted EPS to be in the range of $0.84 to $0.87 and GAAP diluted EPS to be in the range of $0.56 to $0.59. Third quarter fiscal 2013 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $0.28 per share, related primarily to the amortization of purchased intangible assets, restructuring charges and acquisition-related charges. For the full year fiscal 2013, HP estimates non-GAAP diluted EPS to be in the range of $3.50 to $3.60 and GAAP diluted EPS to be in the range of $2.50 to $2.60, in line with HP’s previously communicated outlook.

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HP’s Q2 Earnings Beat Expectations on Weak Sales



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