Hewlett-Packard (NYSE: HP) fell US$3.33 to$33.02 Friday morning after meeting analysts’ lowered expectations for thefiscal first quarter, and saying that revenue growth is likely to be in the singledigits for the rest of the year.
Income before charges for the quarter ended January 31st fell to $328million, or 17 cents per share, from $794 million, or 40 cents, in the sameperiod a year earlier, the Palo Alto, California-based computer maker said.
“Clearly, this was a tough quarter, and our results reflect that,” saidHewlett-Packard chairman, president and chief executive officer Carly Fiorina. “Continueddeterioration in the U.S. economy” led companies to cut back on spending,resulting in a drop in sales of desktop personal computers and printerhardware, she said.
In addition, said Fiorina, “our performance in the commercial channel wasdisappointing.” According to Fiorina, the division was plagued by “insufficient demand generation funds and account conflicts, which we are addressing.”
Analysts at J.P. Morgan and Josephthal & Co. reportedly downgradedHewlett-Packard shares after the report.
“Given ongoing economic uncertainty in the U.S., and the potential that thisuncertainty may spread to other regions, especially those dependent onexports to the U.S., we are maintaining our revenue guidance for the secondfiscal quarter in the low to mid-single digits,” Fiorina said. “We could seerevenue growth improvementin the second half if the U.S. economy improves.”
On the other hand, she said, “visibility remains extremely limited, and weare not counting on a return to double-digit revenue growth this year.”
On the bright side, revenue in Europe, the Asia-Pacific region and LatinAmerica rose during the quarter, and expenses grew just 4 percent, thecompany said.