Computing giant Hewlett-Packard (HP) reported its fourth straight quarter of lower revenues yesterday, pointing to a strong dollar, weak personal computer sales and lower demand from corporates for its services.
Falling demand for PCs has severely impacted the company, with HP reporting a drop in quarterly sales in 15 of the last 16 quarters. Revenue at HP’s PC and printer businesses, its largest division, fell 11.5 per cent in the third quarter ended 31 July.
The company said the decline in PC sales was exacerbated last quarter as customers awaited the release of Windows 10 in July, but chief executive Meg Whitman also warned that other factors putting pressure on the PC market were expected to continue through the fourth quarter and well into the next fiscal year.
Meanwhile, sales in its enterprise services business dropped 11 per cent, while revenue within the group rose two per cent.
HP remains a leader in global computing, retaining its title as the world’s second-largest PC manufacturer.
But the company has struggled in recent years to adapt to keep up with the latest developments in mobile and online computing.
The company is nearing the end of a multi-year restructuring effort under Whitman, who has been cutting costs and focusing on higher-margin sales. Whitman’s plan includes the elimination of about 55,000 jobs.
And chief financial officer Cathie Lesjak said yesterday that the company expects the number of job cuts to increase by up to five per cent by the end of October.
Also later this year, the company is set to split into two, separate listed companies, dividing its computer and printer businesses from the faster-growing corporate hardware and services operations segments.
HP shares closed down 1.37 per cent yesterday, at $27.36 per share.