HP Inc. (NYSE:HPQ) posted the first quarterly revenue growth since splitting from Hewlett Packard Enterprise Co. But the company still under pressure due to the continuous declining revenue from printing operations. The Silicon Valley company said revenue rose 2 percent in the fiscal fourth quarter. The result surprised analysts, who projected a revenue of $11.9 billion.
However, fourth quarter net income dropped 63 percent to $492 million, or 28 cents a share, compared with $1.32 billion, or 73 cents per share, a year earlier. The company said the huge drop in net income was due to costs of one-time payments to company retirees. Excluding certain items, HP earned 36 cents a share in the quarter, missing analysts’ estimates of 37 cents per share.
Company’s revenue comes from two major business, its personal computer business and printing operations business. Both businesses are facing the headwinds now. HP is the second largest PCs supplier in the market. Although more and more people turned to mobile devices, HP still had a rebound in PCs sales in the fourth quarter, thanks to a bigger share in the market, higher prices and higher profit margins.
However, the more profitable printing business continued its weakness. HP said its revenue from printing business dropped 8 percent to 4.6 billion from a year earlier. The company announced to buy Samsung’s printing business for $1 billion in September to help with the company’s printing business.
For the first fiscal quarter, HP expects an adjusted profit of 35 cents to 38 cents per share, below analysts’ estimate of 39 cents per share.