HP Reports Third Quarter 2013 Results

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PALO ALTO, CA--(Marketwired - Aug 21, 2013) - HP (NYSE: HPQ)

HP third quarter fiscal 2013 financial performance

   
  Q3 FY13     Q3 FY12     Y/Y  
GAAP net revenue ($B) $ 27.2     $ 29.7     (8 %)
GAAP operating margin   6.8 %     (29.7 %)   36.5 pts.  
GAAP net earnings (loss) ($B) $ 1.4     $ (8.9 )      
GAAP diluted earnings (loss) per share $ 0.71     $ (4.49 )      
Non-GAAP operating margin   8.4 %     9.2 %   (0.8 pts. )
Non-GAAP net earnings ($B) $ 1.7     $ 2.0     (15 %)
Non-GAAP diluted earnings per share $ 0.86     $ 1.00     (14 %)
Cash flow from operations ($B) $ 2.7     $ 2.8     (6 %)
   

Information about HP's use of non-GAAP financial information is provided under "Use of non-GAAP financial information" below.

HP today announced financial results for its third fiscal quarter ended July 31, 2013. Third quarter GAAP diluted earnings per share (EPS) was $0.71, up from a GAAP diluted loss per share of $4.49 in the prior-year period and above its previously provided outlook of $0.56 to $0.59 per share. Third quarter non-GAAP diluted EPS was $0.86, down from $1.00 in the prior-year period and within its previously provided outlook of $0.84 to $0.87 per share. Third quarter non-GAAP earnings information excludes after-tax costs of $286 million, or $0.15 per diluted share, related to amortization of purchased intangible assets, restructuring charges and acquisition-related charges.

For the third quarter, net revenue of $27.2 billion was down 8% year over year and down 7% when adjusted for the effects of currency.

"We once again achieved the financial performance we said we would, delivering $0.86 in non-GAAP diluted earnings per share, within our previously provided outlook of $0.84 to $0.87," said Meg Whitman, HP president and chief executive officer. "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."

Outlook
For the full year fiscal 2013, HP estimates non-GAAP diluted EPS to be in the range of $3.53 to $3.57 and GAAP diluted EPS to be in the range of $2.67 to $2.71, in line with HP's previously communicated outlook. Full year fiscal 2013 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $0.86 per share, related to the amortization of purchased intangible assets, restructuring charges and acquisition-related charges.

Asset management
HP generated $2.7 billion in cash flow from operations in the third quarter, down 6% from the prior-year period. Inventory ended the quarter at $6.5 billion, down 1 day year over year to 28 days. Accounts receivable ended the quarter at $14.3 billion, down 1 day year over year to 47 days. Accounts payable ended the quarter at $13.3 billion, up 7 days year over year to 57 days. HP's dividend payment of $0.1452 per share in the third quarter resulted in cash usage of $280 million. HP also utilized $3 million of cash during the quarter to repurchase approximately 168,000 shares of common stock in the open market. HP exited the quarter with $13.7 billion in gross cash.

Third quarter fiscal 2013 segment results

More information on HP's earnings, including additional financial analysis and an earnings overview presentation, is available on HP's Investor Relations website at www.hp.com/investor/home.

HP's Q3 FY13 earnings conference call is accessible via an audio webcast at www.hp.com/investor/2013Q3webcast.

About HP
HP creates new possibilities for technology to have a meaningful impact on people, businesses, governments and society. With the broadest technology portfolio spanning printing, personal systems, software, services and IT infrastructure, HP delivers solutions for customers' most complex challenges in every region of the world. More information about HP is available at http://www.hp.com.