For Léo Apotheker, his debut public appearance as chief executive of Hewlett-Packard could not have gone much better had he scripted it. þþThree weeks into his tenure, Mr. Apotheker reported that the technology company beat Wall Street’s quarterly estimates on strong corporate sales despite softness in sales to consumers. þþ“We have remained intensely focused on building our strong position, and I think our results today are further proof of it,” Mr. Apotheker told reporters in a conference call. þþThe company reported net income in its fourth quarter, which ended Oct. 31, rose 5 percent, to $2.54 billion, or $1.10 a share, compared with $2.41 billion, or 99 cents a share, in the period in 2009. þþThe company said revenue rose 8 percent, to $33.28 billion from $30.78 billion. þþThe adjusted net income of $1.33 a share was higher than analysts’ expectations of $1.27 a share for the quarter, according to a First Call survey of securities analysts. Analysts expected revenue of $32.75 billion. þþOver all, the company’s operating profit margin expanded to 12 percent, from 11.8 percent a year earlier. þþInvestors had been eager for news from H.P. as much for what it might say about the company’s future as what it said about its specific performance in the last quarter. þþ“I think on balance it was strong and reassuring for investors,” said A. M. Sacconaghi Jr., an analyst with Bernstein Research. “Collectively, it was confidence-inspiring. But was it unique or particularly revealing? No.” þþThe announcement marked an inauguration for Mr. Apotheker, a former SAP chief executive who became H.P.’s chief on Nov. 1, after the resignation of Mark V. Hurd. þþThe company’s new chief executive had been largely missing from the public eye since he joined the company, leading some people to speculate that Mr. Apotheker was trying to avoid involvement in a legal battle with Oracle. þþMr. Apotheker did not appear in a Federal District Court in Oakland, Calif., where Oracle accused SAP of stealing its intellectual property. SAP accepted responsibility for wrongdoing in that case, but Oracle used the forum as an opportunity to needle Mr. Apotheker, a longtime rival in the market for business software. Oracle tried to serve Mr. Apotheker with a subpoena to appear in court, but the company’s lawyers said they were unable to find him. þþMr. Apotheker told reporters that he has spent the last three weeks visiting customers and employees in the United States, Europe and Asia, but that he was now in the company’s headquarters in Palo Alto, Calif. þþ“I have been from California to Massachusetts and Germany to Singapore, with many stops in between,” Mr. Apotheker said. þþIn a thinly veiled reference to Oracle, Mr. Apotheker told analysts and reporters the company had managed to stay focused on its business through a challenging quarter. “A competitor has tried to distract us — and you — from the good work being done across H.P.’s business,” he said. þþRevenue growth was strong in the Americas, H.P.’s largest market, improving 9 percent, to $15.1 billion. Profit in H.P.’s core PC business rose 23 percent, while unit shipments were up 2 percent. þþCatherine A. Lesjak, H.P.’s chief financial officer, said the company’s consumer business, which accounts for 25 percent of revenue, continued to be soft. “We did see uneven consumer performance across our geographies,” she said. þþNews of Mr. Apotheker’s appointment as chief executive, which took most people by surprise, was received coolly on Wall Street in September, sending shares of H.P. down about 3 percent in after-hours trading. The stock has yet to recover fully since Mr. Hurd’s departure. þþWhile Mr. Apotheker’s 20 years at SAP have left him with a deep understanding of the business software market, investors are eager to better understand his vision for leading H.P.’s core hardware business. þþH.P.’s report appeared to soothe investors concerned about demand after Cisco said two weeks ago that spending by government agencies and cable operators had dropped. “It doesn’t seem like the overall demand environment is so bad,” said Kaushik Roy, an analyst with Wedbush Securities. “The commercial segment is spending quite well, and businesses have money to spend.” H.P., he said, is increasing its higher-margin businesses, while its lower-margin consumer business is sluggish. þþShares of H.P. rose almost 3 percent in after-hours trading. In regular trading, shares rose 76 cents, to $43.25. Earnings were announced after the market closed. þþH.P. told analysts to expect stronger earnings in the current quarter of $1.28 to $1.30 a share, excluding charges, on revenue of $32.8 billion to $33 billion. þþAnalysts were forecasting earnings of $1.22 a share and revenue of $32.7 billion. þþ“We feel good about our broad-based performance in the fourth quarter,” Ms. Lesjak said. “As a company, we are executing on the plans we have laid out.” þþ
Source: NY Times
