HP reports higher profit but cuts up to 16,000 more jobs
CEO Meg Whitman says the company's turnaround 'remains on track'
By James Niccolai | Published: 21:00, 22 May 2014
Hewlett-Packard reported increased profits Thursday as its PC business turned in a strong quarter, but the company will slash thousands more jobs to reduce costs.
HP has already cut 34,000 jobs as part of a plan to boost profits announced two years ago. It will now cut an additional 11,000 to 16,000 jobs to make its workforce "more competitive," it said.
It announced the cuts along with its earnings report for the quarter ended April 30. HP's profit for the period was $1.27 billion, up 18 percent from a year earlier, on revenue of $27.3 billion, which was down 1 percent.
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Its Personal Systems Group, which sells PCs and laptops, continued to buck industry trends by turning in its second straight quarter of growth, with revenue up 7 percent to $8.17 billion, HP said. Strong sales to businesses offset a slump in consumer sales.
That was the only division to report growth, however, with sales in HP printing, enterprise computing and enterprise services all declining.
Things had been looking up for the enterprise computing group, which reported growth the last two quarters. But its x86 server business grew just 1 percent this past quarter, and sales of storage gear and high-end servers were both down.
Excluding one-time items, HP's earnings of $0.88 a share were in line with what financial analysts had been expecting, according to Thomson Reuters. HP revenue fell below the forecast, however.
In a statement, CEO Meg Whitman said HP's turnaround "remains on track."
"We're gradually shaping HP into a more nimble, lower-cost, more customer and partner-centric company that can successfully compete across a rapidly changing IT landscape," she said.