EDS salvages HP’s third quarter profits

HP has recorded a 19% fall in quarterly profits as European businesses continue to hedge their bets on upgrades.

EDS salvages HP's third quarter profits

The company’s chief executive Mark Hurd blamed the fall on Europe’s continuing fascination with netbooks, and a general reluctance on the part of company’s to upgrade.

In its third financial quarter, the company’s profits hit $1.64 billion, down 19% from the same period last year. However, without restructuring and acquisition costs that figure would have been up around $2.2 billion.

Sales dipped to $27.5 billion from $28 billion, falling in every department except Services – which was bolstered by last year’s blockbuster acquisition of EDS. However, analysts are questioning just how much more HP can squeeze out of that cash cow with sales jumping a further 93% in the third quarter.

Elsewhere, HP watched its enterprise business shrink 23% to $3.7 billion, with storage and servers down 21%. Software revenues were down 22% to $847 million, while printers slid 20% to $5.7 billion.

HP is still predicting full-year revenues in 2009 to be around 5% lower on last year’s $118.4 billion, though the company reckons £2010 will be a better year than 2009.”

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