HP Profit Misses Street - Update

(RTTNews) - Shares of Hewlett-Packard Co. (HPQ) slipped a near 6 percent in extended session on Tuesday after the computer and printer maker reported a fourth-quarter profit and revenues that fell short of Wall Street estimates, hurt largely by continued weak demand for PC.

It is for the last time HP is releasing earnings result of its two separated units as one unit. HP last month separated into two independent companies - Hewlett Packard Enterprise Co. (HPE) and HP Inc. (HPQ) - in an effort to curb costs improve its sluggish sales.

HP's fourth-quarter profit dropped to $1.32 billion or $0.73 per share from $1.33 billion or $0.70 per share last year.

Excluding one-time items, adjusted earnings for the quarter were $0.93 per share, down from $1.06 per share last year..

Revenues for the quarter dropped 9 percent to $25.71 billion from $28.41 billion last year.

Analysts polled by Thomson Reuters estimated earnings of $0.97 per share on revenues of $26.36 billion for the combined company. Analysts' estimates typically exclude special items.

Hewlett Packard Enterprise, with more than $50 billion in annual revenue, will provide the technology solutions required by customers to optimize their traditional IT, while HP Inc. will be a personal systems and printing company.

Looking forward, HP estimates first-quarter adjusted earnings of $0.33 to $0.38 per share and full year adjusted earnings of $1.59 to $1.69 per share. Analysts currently estimate earnings of $0.42 for the first quarter and $1.71 per share for 2016.

For full year 2016, Hewlett Packard Enterprise affirmed its adjusted earnings outlook of $1.85 to $1.95 per share. For the first quarter, the Hewlett Packard Enterprise expects earnings of $0.37 to $0.41 per share. Analysts currently estimate earnings of $0.43 per share for the first quarter and $1.88 per share for 2016.

HPQ shares closed Tuesday's trading at $14.64, up $0.41 or 2.88%, on the NYSE. The stock further dropped $0.86 or 5.87% in the after-hours trade.

HPE closed Tuesday's trading at $13.69, down $0.16 or 1.16%, on the NYSE. The stock, however, gained $0.36 or 2.63% in the after-hours trade.