Hewlett-Packard beats by $0.03, reports revs in-line; guides Q4 EPS below consensus; separation on track
Reports Q3 (Jul) earnings of $0.88 per share, excluding non-recurring items, $0.03 better than the Capital IQ Consensus of $0.85; revenues fell 8% YoY (-2% ex-FX) to $25.35 bln vs the $25.45 bln consensus.
Personal Systems revenue was down 13% YoY with a 3.0% operating margin. Commercial revenue decreased 9% and Consumer revenue decreased 22%. Total units were down 11% with Notebooks units down 3% and Desktops units down 20%.
Printing revenue was down 9% YoY with a 17.8% operating margin. Total hardware units were down 2% with Commercial hardware units down 6% and Consumer hardware units flat. Supplies revenue was down 6%.
Enterprise Group revenue was up 2% YoY with a 13.0% operating margin. Industry Standard Servers revenue was up 8%, Storage revenue was down 2%, Business Critical Systems revenue was down 21%, Networking revenue was up 22% and Technology Services revenue was down 9%.
Enterprise Services revenue was down 11% YoY with a 6.0% operating margin. Infrastructure Technology Outsourcing revenue was down 13%, and Application and Business Services revenue declined 7%.
Software revenue was down 6% YoY with a 20.6% operating margin. License revenue was down 11%, support revenue was down 3%, professional services revenue was down 8% and software-as-a-service (SaaS) revenue was down 4%.
Co issues downside guidance for Q4, sees EPS of $0.92-0.98, excluding non-recurring items, vs. $1.00 Capital IQ Consensus.
"I am very pleased that we have continued to deliver the results we said we would, while remaining on track to execute one of the largest and most complex separations ever undertaken."