- Associated Press - Thursday, August 19, 2010

SAN FRANCISCO (AP) - Hewlett-Packard Co.’s net income jumped 6 percent and revenue notched 11 percent higher in HP's last full quarter under now-ousted CEO Mark Hurd.

The numbers reported Thursday squared with preliminary results HP revealed Aug. 6 in announcing Hurd’s abrupt resignation.

In his five years at HP, Hurd aggressively cut jobs and other costs and orchestrated a broad push beyond personal computers and printers. He left as HP is starting to face sharper questions over his stewardship and how HP plans to grow beyond cuts and acquisitions.

The latest numbers show that one of Hurd’s biggest projects _ transforming HP into a technology-services powerhouse like IBM Corp. _ is progressing slowly. Outsourcing and other services help companies save money, but are under pressure as many companies are hesitant to commit to long-term deals out of fears about the economy and their financial health.

Meanwhile, HP's bedrock businesses of selling computers and printer ink are chugging along. Those face pressures too, as many analysts are predicting a weak back-to-school season.

HP's net income was $1.77 billion, or 75 cents per share, in the three months ended July 31, its fiscal third quarter. That compares with $1.67 billion, or 69 cents per share, a year ago.

Excluding items, HP would have earned $1.08 per share. That was in line with analysts’ forecasts.

Revenue was $30.7 billion, up from $27.6 billion a year ago. Analysts expected $30.4 billion.

Some analysts have been asking where HP's growth is coming from.

In the latest period, revenue in HP's most profitable division, services, grew just 1 percent to $8.6 billion, the slowest growth rate among HP's major divisions.

Meanwhile, revenue in the personal computer division rose 17 percent to $9.9 billion. Revenue in the printer and ink division _ historically HP's cash cow _ rose 9 percent to $6.2 billion. Servers and storage grew 19 percent to $4.4 billion.

Hurd was forced out in a fight with HP's board over a sexual-harassment claim against him and inaccurate expense reports connected to his dinners and other outings with his accuser.

HP found that its sexual-harassment policies weren’t violated, but that its standards of appropriate business conduct were. Hurd settled with his accuser for an undisclosed sum and was given a severance package that could top $40 million. He says that he never prepared his own expenses and that the omission of his accuser’s name from some of the reports was inadvertent, as her name appeared on others.

After Hurd resigned, HP's market value plunged by as much as $15 billion in the following days. The stock dropped by about 14 percent, before recovering in recent days as investors digested news of Hurd’s departure. Shares are still 12 percent down since the announcement, and HP's market capitalization was about $95 billion at the close of regular-session trading Thursday.

Shares fell 21 cents, or 0.5 percent, to $40.55 in extended trading Thursday after the release of results. In regular trading earlier, shares fell 60 cents, or 1.5 percent, to close at $40.76.

Copyright © 2016 The Washington Times, LLC.

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