HP (HPQ) Reports Strong Q4 Earnings, Falls On Soft Q1 View
Zacks Investment Research | Nov 21, 2017 10:25PM ET
HP Inc. (NYSE:HPQ) has come up with another quarter of stellar performance. The company reported better-than-expected results in fourth-quarter fiscal 2017 and revenues increased for the fifth-consecutive quarter after an extended period of decline. Also, the Personal Systems and Print segments have improved for the third-straight quarter after 2010.
In fact, the company’s outstanding results for the last few quarters substantiate that the spin-off from Hewlett Packard Enterprise Company (NYSE:HPE) coupled with restructuring initiatives is finally paying off for HP.
HP’s total revenues increased 11% year over year to $13.927 billion and outpaced the Zacks Consensus Estimate of $13.246 billion. The better-than-expected top-line performance was driven mainly by strength in the Personal System and Printing segments along with the successful launch of products.
The company’s bottom-line results were also impressive, wherein its non-GAAP earnings from continuing operations of 44 cents per share matched the Zacks Consensus Estimate. The figure came toward the higher-end of management’s earlier guidance range of 42-45 cents. On a year-over-year basis, non-GAAP earnings improved 22.2%.
Despite reporting better-than-expected results and strong top-line growth, shares of HP have declined over 5.5% during yesterday’s after-hours trading. The downturn was owing to the company’s soft first-quarter fiscal 2018 non-GAAP earnings guidance range, which at mid-point is slightly lower than the Zacks Consensus Estimate.
Moreover, Meg Whitman, CEO of its sister company, HPE, announced her retirement yesterday. During her six-year tenure, she initiated a number of turnaround strategy but most of them failed to gain traction. We believe the news might have turned investors a little cautious.
Consequently, HP’s shares have underperformed the Zacks Investment Research
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