HP Calms Wall Street With Solid 4Q Outlook.
On the front page of its Marketplace section, the Wall Street Journal (11/19, B1, Scheck, Dicolo) reports that CEO "Mark Hurd's focus on cost cutting helped turn around Hewlett-Packard Co. (HP) when the economy was strong. Now with the economy slumping," Hurd "is relying on the same strategy to keep profits up." HP on "Tuesday surprised Wall Street with an early announcement of better-than-expected earnings for its most recent quarter -- one of the few tech companies to unveil positive numbers in the past few weeks." Also, "the world's biggest maker of PCs by revenue...forecast improved profit next year, even as it projected revenue will be lower than analysts' estimates, an indication the company will continue its aggressive cost cuts."
The New York Times (11/19, B2, Richtel) adds, "The company said its core business was not declining as quickly as it was at other major technology companies, prompting investors to drive its shares up nearly 15 percent." HP "also said that its fourth-quarter results had exceeded its earlier projections." In the meantime, "companies like Cisco Systems and Intel, reporting a rapid decline in consumer spending starting in October, have prepared investors to expect revenue declines of 10 percent or more."
The Financial Times (11/19, Waters) describes the company "as the technology industry's main bellwether," noting that HP's "pre-announced earnings and issued a forecast for next year that helped calm recent frayed nerves on Wall Street." The tech giant, however, "warned the strength of the dollar would wipe 6-7 percentage points from its revenue growth rate next year. In spite of that, HP's revenues and earnings held up through to the end of October, the end of its fiscal year, and the company gave a strong earnings forecast for its current fiscal year." Forbes (11/19, Gutierrez), the AP (11/19, Ortutay), MarketWatch (11/19, Crum) and Product Reviews (11/19) also cover the story.
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