HP today announced financial results for its third fiscal quarter ended July 31, 2010, with net revenue of $30.7 billion, up 11.4% from a year earlier including a favorable currency benefit of approximately one percentage point.
***We will continuously update this post today with quotes, transcripts, and presentations relating to HP’s third quarter earnings report. Visit HP Investor Relations for more information or follow @hpnews on Twitter and Stocktwits.
Read the full news release, financials, and information about the use of non-GAAP financial information and forward-looking statements
Comment from Chief Financial Officer and interim CEO, Cathie Lesjak:
“The broad-based strength of HP’s Q3 performance further demonstrates the power of our strategy and the discipline of our execution,” said Cathie Lesjak, HP chief financial officer and interim chief executive officer. “We raised our full-year outlook and are continuing to build momentum in driving out costs, investing for profitable growth and capitalizing on HP’s competitive advantages in the marketplace.”
Highlights:
— Third quarter net revenue of $30.7 billion, up 11.4%, or $3.1 billion, from a year earlier
— Third quarter GAAP operating profit up 5% to $2.3 billion; GAAP diluted earnings per share of $0.75, up 9% from $0.69 a year earlier
— Third quarter non-GAAP operating profit up 14% to $3.4 billion; non-GAAP diluted earnings per share of $1.08, up 17% from $0.92 a year earlier
— Broad-based year-over-year revenue growth driven by ESS at 19%, PSG at 17% and IPG at 9%
— Record services signings
— Solid year-over-year revenue growth across all regions
Helpful links
Webcast of 3Q10 earnings conference call and Q&A, 3pm PT, Thursday, August 19, 2010
HP SEC filings
Earnings presentation
Cathie Lesjak: Select quotes from earnings call
- We grew revenue 11 percent, expanded operating margins 30 basis points versus the prior year and grew non-GAAP EPS by 17 percent to $1.08.
- We have significant savings still to be captured in our services, supply chain and real estate initiatives. At the same time, we are increasing our investments in R&D and sales and marketing. We see attractive opportunities to take our portfolio to the next level and we expect our expanded sales force will increase sales of our broad portfolio of products and services.
- Operating expenses increased 10 percent to $3.9 billion as we accelerated investments to drive long-term growth including increases in R&D and building out our enterprise sales force.
- The third quarter gross margin was 23.8 percent, up slightly from the prior year and up 30 basis points sequentially.
- With the close of 3Com in Q2, we are accelerating our investments in networking. HP Networking, which is reported in the Corporate Investments segment, recorded organic growth of 42 percent or total growth of 198 percent including 3Com which was ahead of plan in Q3. In the last 90 days, we have seen significant interest in our HP Networking data center solutions. 300 of our top 1000 customers have initiated proofs of concept and customers including Marriott, Dreamworks, and the US Department of Health & Human Services
