Hewlett Packard Co's revenue fell less than Wall Street expected in the first quarter and it raised its outlook for fiscal 2014 earnings, as the computing giant grew sales at its two largest businesses and again signalled a better year ahead. HP, which is in the midst of a multi-year turnaround effort intended to revive growth, is trying to wean the Silicon Valley company off its reliance on personal computers and re-orient on sales of computing equipment and networking gear to enterprises.
On Thursday, the company broke its streak on the PC-focused personal system group with a 4 percent gain in revenue. Business at its enterprise group, the lynchpin of its strategy to transform itself into an IBM-like provider of enterprise computing services, edged 1 percent higher as server sales fared better than analysts had expected.
Chief Executive Officer Meg Whitman, who took the helm of the world's largest PC maker more than a year ago, has said she expects revenue to stabilise in 2014, with some areas of growth for the company. On Thursday, Whitman stuck to that outlook and told Reuters she was upbeat on their European business as the developed part of that region stabilised, and saw strength in emerging markets like India and Mexico. She added that HP's business in China stayed largely flat, better than competitors had fared. "Pleased with the progress, more work to be done," Whitman summarised for Reuters in an interview.
On Thursday, HP raised the lower end of its full-year earnings outlook slightly, to $3.60 to $3.75 versus a previous forecast for $3.55 to $3.75. Investors have been cautious on the outlook for computing companies after IBM posted disappointing results, in part because of slowing corporate and emerging markets demand, and a backlash against US corporations in China over revelations of US spying activity abroad. Cisco Systems Inc, a rival in networking equipment, forecast a 6 percent to 8 percent decline in revenue this quarter.
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