HP Pulls Annual Guidance, 3Q Earnings Guidance Misses Wall Street Estimates Amid Pandemic -- Earnings Review
By Maria Armental
HP Inc. reported second-quarter results on Wednesday and gave
third-quarter guidance but pulled financial projections for the
year, citing uncertainty about the business impact of the
coronavirus pandemic. Here's what you need to know:
PROFIT: Net income fell to $764 million, or 53 cents a share,
from $782 million, or 51 cents a share. The latest results included
6% fewer shares outstanding.
On an adjusted basis, profit fell to 51 cents a share from 53
cents a share a year earlier.
HP had projected 46 cents to 50 cents a share, or 49 cents to 53
cents a share as adjusted, while analysts surveyed by FactSet
expected a profit of 43 cents a share, or 44 cents as adjusted.
REVENUE: Net revenue fell to $12.47 billion from $14.04 billion
a year earlier, driven by a 19% decline from printing. Analysts
expected sales to fall to about $12.93 billion.
OUTLOOK: HP pulled financial projections for the year, citing
uncertainty about the business impact of the pandemic, but said
that this quarter it expects to make 35 cents to 41 cents a share,
or 39 cents to 45 cents a share on an adjusted basis. That compares
with analysts' projected 47 cents a share.
PANDEMIC: HP said its supply chain returned to full capacity in
early May and that it ended the April quarter with a strong PC
BUYBACK: HP, which at the time faced a hostile takeover bid from
Xerox Holdings Corp., had raised its share buyback program to $15
billion, targeting at least $8 billion in the first year, and
increased its target long-term return of capital to 100% of free
cash flow, "unless higher return opportunities emerge." HP said it
would maintain dividend per share growth at least in line with
earnings. On Wednesday, company officials said they remained
committed to the principles HP discussed in February. Company
officials are expected to give more detail during the earnings
CASH & DEBT: HP ended the quarter with about $4.05 billion
in cash, compared with $4.21 billion as of Jan. 31, and about $5.5
billion in debt.
Write to Maria Armental at firstname.lastname@example.org
(END) Dow Jones Newswires
May 27, 2020 16:20 ET (20:20 GMT)
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