HP Exceeds Fourth-Quarter Sales Projections on Strong PC Demand
(Bloomberg) -- HP Inc. reported quarterly revenue that exceeded analysts’ projections, helped by a better supply of components to meet rising corporate demand for its personal computers. The shares surged in extended trading.
Revenue gained 9% to $16.7 billion in the fourth quarter, which ended Oct. 31, the Palo Alto, California-based company said Tuesday in a statement. Analysts, on average, projected $15.4 billion, according to data compiled by Bloomberg. Profit, excluding some items, was 94 cents a share, compared with an average estimate of 88 cents.
“What we have seen is very strong demand, especially in commercial and high-premium consumer categories, which have higher prices and higher value,” Chief Executive Officer Enrique Lores said in an interview. “Additionally, we have seen cost increases and we have responded to those with price increases, so we are managing our profitability well in an inflationary environment.”
While the company is getting a boost from higher demand, HP has struggled to fill all its orders because of shortages of some types of chips. Lores has said that demand for PCs will continue at the elevated levels experienced during the pandemic despite the return to offices and schools.
Global PC shipments increased just 1% in the third quarter compared with a year earlier, analyst Gartner Inc. reported last month, in large part limited by the struggling supply chain. The researcher estimated HP’s unit sales dropped 5.8% in the period. HP last month said long-term revenue growth will be in the “low single digit” percentage.
HP shares jumped 13% in extended trading after closing at $32.19 in New York. The stock has gained 30% this year.
Revenue from Personal Systems, mostly computers, climbed 13% to $11.8 billion in the recent period. Commercial PC sales gained 25% while consumer revenue declined 3%.
Printing sales rose 1% to $4.88 billion. Lores said that a 26% hardware shipment decline was due to supply constraints, and that the company is seeing improvements in demand from offices.
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