HP Inc’s second quarter revenues beat analysts’ forecast

Strong growth in the premium notebooks segment as well as a one-time tax benefit of $975 million can be attributed as the reasons for its surprise performance.

On the back of strong demand for desktop and notebooks, HP Inc has reported a better-than-expected quarterly results.

HP Inc also named Steve Fieler as its chief financial officer (CFO). He will succeed Cathie Lesjak, who has served HP for 32 years.

Fieler currently heads HP’s treasury and corporate finance department. His appointment as CFO is effective from July 1.

Lesjak will now be the interim chief operating officer.

With the news reaching the market, shares of HP Inc were up marginally, in extended trading.

HP has raised its 12 months forecast and adjusted profits between $1.97 and $2.02 per share, up from $1.90 to $2.00. This is against analysts’ expectations of $1.97, as per Thomson Reuters I/B/E/S.

HP Inc’s personal systems business, which includes sales of desktops and notebooks, accounts for more than 60% of its total revenue, rose by 14.5% to $8.76 billion in the second quarter, against analysts’ expectations of $8.28 billion.

According to International Data Corp (IDC) Palo Alto-based HP Inc was the No. 1 PC seller, in terms of shipments, in the first calendar quarter of 2018, with a market share of 22.6%.

As per IDC analysts, demand for premium notebooks in the consumer and the commercial segments, have helped PC vendors retain their margins.

HP Inc, which completed its acquisition of Samsung Electronics Co’s printer business in 2017, stated revenues from its printing business rose by 10.9% to $5.24 billion, above analysts’ estimate of $5.13 billion.

Its net earnings has jumped 89.3% to $1.06 billion. This can be attributed to a one-time tax benefit of $975 million.

Excluding items, the company earned 48 cents per share, in line with Wall Street estimates while its revenue rose by 13.1% to $14 billion, above analysts’ average estimate of $13.57 billion.

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