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H-P's (HPQ) printing and services margins, up in FQ4, will fall again in FQ1, the company...

H-P's (HPQ) printing and services margins, up in FQ4, will fall again in FQ1, the company disclosed on its earnings call. Printing margins are pressured by ink inventory issues, and services margins by a "run-off" in sales as the business restructures. Enterprise hardware margins are hurt by European price pressure, declining Itanium sales (in spite of the Oracle ruling), and a mix shift towards the cheap "hyperscale" servers preferred by Web companies. The PC unit faces all the demand and pricing issues you'd expect, and printer units fell 20% Y/Y. (live blog, slides) (FQ4: I, II, III)
Comments (4)
  • wyostocks
    , contributor
    Comments (7650) | Send Message
     
    When is the next layoff coming? This is a slow motion, painful train wreck.
    20 Nov 2012, 09:28 AM Reply Like
  • TwistTie
    , contributor
    Comments (2477) | Send Message
     
    I am normally a quippy sort.

     

    Not today. This is stunning.
    20 Nov 2012, 11:39 AM Reply Like
  • jstratt
    , contributor
    Comments (2234) | Send Message
     
    I would encourage true investors to take a look at the slides and statements on HP's web site. The only news is about the alleged fraud but if you look at the numbers some surprising things jump out.

     

    Cash flow 4 bil qtr, 10.57 bil for the yr, 7.5 bil FCF (free cash flow)

     

    9.2 bil share buyback auth remains

     

    FY13 GAAP EPS proj = 2.10 - 2.30

     

    Learning that they paid to much for Autonomy wasnt exactly a great revelation.
    20 Nov 2012, 12:23 PM Reply Like
  • jstratt
    , contributor
    Comments (2234) | Send Message
     
    What is HPQ worth?

     

    Currently it is valued at 3.1 times Free Cash Flow (23.26 market valuation / 7.5 fy12 FCF)
    20 Nov 2012, 01:11 PM Reply Like
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