HP Inc (NYSE:HPQ) reported impressive earnings that surpassed analyst expectations during the latest earnings call though the improving profits do not reflect the performance of its PC and printer business.
The company’s shares took an upward turn and traded higher by more than 2% on Wednesday after the bell. The trend reversal came after the firm decided to employ an aggressive cost slashing strategy that helped the firm to deal with the weak demand for its printers and PCs. Technology analyst Bill Kreher of the Edward Jones research firm stated that the overall sentiment from the company’s investors could have been worse considering the unappealing performance of the PC and printer business.
The performance of the business overall is in line with forecasts though.
Analysts had correctly speculated that HP’s core business did not have any signs of improving any time in the near future, and the company has constantly found itself on a rough path as the business declines. The company’s CEO Dion Weisler stated that the firm is doing its best to make sure that the business gains stable ground.
During the recent analyst call, HP’s CEO stated that the current market situation has become the norm. Weisler, however, stated that he would not be at peace until his company restores sustainable growth. The CEO also noted the firm made plans earlier this year to slash about 3,000 jobs by the end of the year. The company’s CEO Catherine Lesjak pointed out that more than 800 employees exited in the second quarter and that HP has let go more than 1,200 employees so far since the beginning of the year. She also stated that more job cuts are expected.
The company executives, however, believe that there is still hope for the future of the printer and PC business. The executives expect the business to register improving sales by the end of 2017. The printer business dropped by 16% to $3.1 billion in the second quarter. The CEO revealed that the printer sales are different from region to region, and the company plans to create a strategy that will take advantage of locales.