HP starts to show benefits of Compaq merger

By Steve Malone

Posted on 21 May 2003 at 10:25

One year after its merger with Compaq, Hewlett-Packard is getting a grip on the expanded company. Its Q2 2003 revenues totalled $18.0 billion, compared to $17.9 billion in Q1 and just $10.6 billion of premerger revenues in Q2 last year when sales dropped by 7 per cent.

Earnings per quarter were 25c per share, which was basically in line with what the market expected. Although the quarter on quarter revenues didn't show stunning growth, the industry normally expects a pause in Q2.

The personal systems division profits were $21 million, compared to $33 million in the previous quarter. The company is hoping that the recently launched iPAQ h1900 and the wireless iPAQ h5450 handheld as well as the recently launched notebook range will help boost sales in the months to come.

Last year's torrent of launches from the Imaging division is reflected in the sales up 13 per cent year-over-year and down 1 per cent on the quarter with supplies - toner cartridges and the like - up 7 per cent on the quarter and 15 per cent year on year,

The Enterprise division is still proving the problem child. However, there are signs that things are turning around with the division losing $7 million compared to $83 million the previous quarter. The improvement is attributed to better sales (up 3 per cent overall) and cost cutting measures. In a statement, Carly Fiorina said that savings of around $3.5 billion a year across the board are now being achieved.