Hewlett-Packard Co., the world’s biggest printer maker and the No. 2 personal-computer seller, said Wednesday that first-quarter profit rose 30 percent as holiday demand drove sales. The earnings forecast for this quarter exceeded analysts’ estimates, sending the shares higher.
Net income rose to $1.23 billion, or 42 cents a share, from $943 million, or 32 cents a share, a year earlier, Palo Alto, Calif.- based Hewlett-Packard said in a statement. Sales rose 5.6 percent to $22.7 billion in the period ended Jan. 31. The company also plans a $4 billion stock buyback.
Earnings in the PC business almost doubled, and profit margins in printers held up better than expected with holiday discounts as chief executive Mark Hurd cut costs. He sliced prices to win customers for more profitable printing supplies and won orders away from market leader Dell Inc. after building less-expensive computers using low-priced chips.
H-P has operations in Colorado Springs, Fort Collins, Littleton and Loveland that employed about 5,300 people last year.
“You have another beat-and- raise scenario under Mark Hurd’s leadership,” said Brent Bracelin, an analyst at Pacific Crest Securities in Portland, Ore.
He rates the shares “sector perform” and said he doesn’t own them.
This marked the third straight quarter that Hurd topped the company’s earnings forecast. Profit, including stock-based compensation costs and excluding expenses from job cuts, was 48 cents a share. Hewlett-Packard had predicted profit of 42 cents to 44 cents on sales of $22.3 billion to $22.6 billion.
The shares jumped $1.31 to $32.98 in extended trading. They lost 82 cents to close at $31.67 Wednesday in New York Stock Exchange composite trading. The stock has gained 60 percent since Hurd was named as Carly Fiorina’s replacement March 29.
