H-P's FQ2 guidance light, FY14 guidance in-line. PC sales improve.

|By:, SA News Editor

H-P (HPQ) expects FQ2 EPS of $0.85-$0.89 vs. an $0.89 consensus, and FY14 (ends in October) EPS of $3.60-$3.75 vs. a $3.67 consensus.

PC sales rose 4% Y/Y in FQ1 after dropping 2% in FQ4, and contributed to a strong revenue beat. Desktops -3%, notebooks +5%. Business PCs +8%, consumer PCs -3%.

Printing -2% vs. -1%. Hardware +5% (drives future supplies sales), supplies -3%.

Enterprise hardware +1% vs. +2%, enterprise services -7% vs. -9%, software -4% vs. -9% with a 6% license revenue drop. Financial services -9% vs. -6%.

$565M was spent on buybacks. Job cuts led sales/marketing spend to fall 3% Y/Y to $3.2B. R&D +2% to $811M.

HPQ -0.6% AH. FQ1 results, PR.