HP swings to profit, but PC woes hit revenues

Hewlett-Packard saw profits return in the past quarter, but slumping PC sales took a bite out of revenues of the troubled US tech giant. In results for the fiscal third quarter released Wednesday, HP said its net profit was $1.39 billion, a turnaround from the same period last year when a massive writedown led to losses of $8.9 billion. But revenues for the quarter fell eight percent from a year ago to $27.2 billion, and PC sales floundered. HP said consumer revenue for its personal systems unit which makes PCs declined 22 percent. Total unit sales were down eight percent, with desktops falling nine percent and notebooks 14 percent. The California company has been in focus amid a severe slump in PC sales globally, as it has failed to adapt to a shift to mobile devices. Meg Whitman, HP president and chief executive, said however the company "achieved the financial performance we said we would," meeting analyst forecasts for profits. "I remain confident that we are making progress in our turnaround. We are already seeing significant improvement in our operations, we are successfully rebuilding our balance sheet, our cost structure is more closely aligned with our revenue and we have reignited innovation at HP, with a focus on the customer." HP also said it was shaking up its executive leadership team to "help the company accelerate its turnaround." Bill Veghte, currently chief operating officer, will become executive vice president and general manager of the HP Enterprise Group, which includes cloud computing. No one will be assigned to the COO job. Veghte takes over from Dave Donatelli, who "will take on a new role focused on identifying early-stage technologies," an HP statement said.