Last HP-only quarter shows sales drop; earnings fall from Q1

HP reported its last set of results as a standalone company in May, with Q2 numbers showing a drop in the firm’s printer sales contributing to a 9 percent dip in revenue compared to Q2 of 2001. Overall quarterly profits were less than half of those posted for this year’s first quarter.

CEO Carly Fiorina said the company “executed well during a difficult quarter,” adding that the “IT spending environment remains tough around world.” Outside its corporate computer markets, HP also saw its consumer business revenues “down slightly.”

Computing Systems, an HP group that includes both HP 3000s and Unix servers, remained a sore spot for HP in its final report before including Compaq’s business. The segment’s overall sales were down 6 percent from last quarter, and the group continued to report more red ink: operating margins showed a loss of more than 12 percent, compared to 8 percent loss in the last quarter and 5 percent one year ago. The Computing Systems segment has led the company in losses for the last four quarters. For 2002’s first half, the segment lost $400 million.

HP gave an analyst briefing on June 4, but noted it expects no significant recovery in IT spending through the rest of this year. Gartner and Giga Information Group released surveys predicting a slight rise in IT spending during 2002’s second half.