HP Profit Down 10%, but Revenue Gain Beats Forecasts

Hewlett-Packard Co. said earnings fell 10%, less than expected, in its fiscal first quarter as revenue growth surpassed forecasts.

The computer maker reported profit from continuing operations of $794 million, or 80 cents a share, down from $882 million, or 85 cents, a year ago as memory costs rose. The results beat analysts’ consensus forecast of 78 cents, according to First Call/Thomson Financial.

Revenue grew 14% to $11.7 billion as Chief Executive Carly Fiorina made progress in challenging Sun Microsystems Inc. for server sales to companies doing business online. Sales of notebook computers more than tripled and consumer PCs almost doubled, helping the company’s PC unit growth outpace most of its rivals in the calendar fourth quarter.

“We delivered excellent results overall, particularly in terms of revenue growth,” Fiorina said. She said the company saw strong growth in several key product areas and was “beginning to see progress in turning our Unix business around.”

Sales in the computer business, which includes PCs and servers, rose 15%, led by notebooks and home PCs.

Fiorina said 30% growth in the consumer market and significant rebound in Asia contributed to Hewlett-Packard’s revenue surge. The company’s important printer unit also posted sales gains of 13%.

HP is recovering from product delays and slowing sales in the Unix server business. The company has lagged behind rivals such as Sun in server sales growth because it was late to pursue a clear strategy for benefiting from the Net.

The company’s latest results exclude expenses for the spinoff of Agilent Technologies Inc. The year-ago profit and sales figures exclude Agilent. HP shares rose $4.31 to $129.06 in regular New York Stock Exchange trading, then rose to $131 in after-hours trading.

Analog Devices Profit Triples: Analog Devices Inc., a maker of high-speed communications chips, said its fiscal first-quarter earnings more than tripled to $93 million, or 50 cents a share, from $29.9 million, or 18 cents, as sales jumped 63% to $490.3 million.

Analysts were expecting 45 cents on average, according to First Call/Thomson Financial.

Analog Devices also said it will split its shares 2-for-1 on March 15 for shareholders of record Feb. 28.

Analog Devices shares rose $7.13, or 5.9%, to $127 on the NYSE. The shares have almost quadrupled over the last year.

Reuters was used in compiling this report.