Firm delivers its Q1 2015 financial report

HP notebook sales rise as desktop falls

HP has reported an overall lift in PC unit sales during its fiscal Q1 2015 financial period.

Total units were up nine per cent, with notebook unit sales up 21 per cent but desktop units down seven per cent.

Overall, Personal Systems revenue was flat year-on-year with a 3.7 per cent operating margin, while commercial revenue decreased one per cent and consumer revenue increased two per cent.

First quarter net revenue reached $26.8 billion, down five per cent from the prior-year period, while net earnings during the period remained flat at $1.4 billion.

HP returned $1.9 billion to shareholders in the form of share repurchases and dividends in the first quarter.

"With the first quarter of fiscal 2015 now behind us, the HP turnaround remains on track," said Meg Whitman, chairman, president CEO at HP. "We grew operating profit margins across all of our major business segments, increased investment in innovation, and executed well across key areas of our portfolio and in our separation activities. Our progress continues as we head into Q2.

"While we were able to manage the impact of currency in the quarter and deliver earnings as expected, we believe the impact on FY15 will be significantly greater than we anticipated in November.

"We’ll work hard to offset these impacts through re-pricing and productivity, but fully mitigating currency movements of this size would require reducing investments and mortgaging our future. We won’t do that."

Here’s a round up of HP’s business sectors during Q1 2015: 

  • Printing revenue was down 5 per cent year over year with a 19.2 per cent operating margin. Total hardware units were down 4 per cent with Commercial hardware units flat and Consumer hardware units down 6 per cent. Supplies revenue was down 5 per cent.
  • Enterprise Group revenue was flat year over year with a 15.6 per cent operating margin. Industry Standard Servers revenue was up 7 per cent, Storage revenue was flat, Business Critical Systems revenue was down 9 per cent, Networking revenue was down 11 per cent and Technology Services revenue was down 5 per cent.
  • Enterprise Services revenue was down 11 per cent year over year with a 3 per cent operating margin. Application and Business Services revenue was down 11 per cent, and Infrastructure Technology Outsourcing revenue declined 11 per cent. 
  • Software revenue was down 5 per cent year over year with an 18 per cent operating margin. License revenue was down 16 per cent, support revenue was flat, professional services revenue was down 7 per cent and software-as-a-service (SaaS) revenue was flat. 
  • HP Financial Services revenue was down 8 per cent year over year with a 1 per cent decrease in net portfolio assets and a 14 per cent increase in financing volume. The business delivered an operating margin of 11.2 per cent.

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