HP net revenue for the first quarter, ended 31 January, was $28,8-billion, up 1% from a year earlier and up 4% when adjusted for the effects of currency. However, the company's profits declined.

In the first quarter, GAAP operating profit was $2,5-billion and GAAP diluted earnings per share (EPS) was $0,75, down from $0,80 in the prior-year period.
Non-GAAP operating profit was $3,1-billion, with non-GAAP diluted EPS of $0,93, up from $0,86 in the prior-year period. Non-GAAP financial information excludes $431-million of adjustments on an after-tax basis, or $0,18 per diluted share, related primarily to amortisation of purchased intangible assets, restructuring charges and acquisition-related charges.
GAAP and Non-GAAP diluted EPS include $0,03 of charges related to currency hedging losses.
Mark Hurd, HP chairman and CEO, comments: "Our market strength, disciplined cost management and diverse portfolio allowed us to differentiate HP in the global marketplace and gain share in key markets."
Revenue grew 11% in the Americas to $12,4-billion, but declined 3% in Europe, the Middle East and Africa and 11% in Asia Pacific to $12-billion and $4,4-billion, respectively.
When adjusted for the effects of currency, revenue grew 13% in the Americas and 1% in Europe, the Middle East and Africa while declining 9% in Asia Pacific.
Revenue from outside of the US in the first quarter accounted for 65% of total revenue, with revenue in the BRIC countries (Brazil, Russia, India and China) declining 22% over the prior-year period while accounting for 7% of total HP revenue.
Personal Systems Group (PSG) revenue declined 19% to $8,8-billion, with unit shipments down 4%. Notebook revenue for the quarter was down 13%, while desktop revenue declined 25%. Commercial client revenue was down 19%, while consumer client revenue decreased 18%. Operating profit was $435-million, or 5% of revenue, down from $628-million, or 5,8% of revenue, in the prior-year period.
Imaging and Printing Group (IPG) revenue declined 19% to $6-billion. Supplies revenue was down 7%, while commercial hardware revenue and consumer hardware revenue declined 34% and 37%, respectively. Printer unit shipments decreased 33%, with consumer printer hardware units down 31% and commercial printer hardware units down 39%. Operating profit was $1,1-billion, or 18,5% of revenue, versus $1,1-billion, or 15,5% of revenue, in the prior-year period.
Enterprise Storage and Servers (ESS) reported total revenue of $3,9-billion, down 18%. Storage revenue declined 7% with the midrange EVA product line down 7%. Industry Standard Server revenue and Business Critical Systems revenue declined 22% and 17%, respectively, while ESS blade revenue grew 4%. Operating profit was $405-million, or 10,3% of revenue, down from $673-million, or 14% of revenue, in the prior-year period.
Services revenue increased 116% to $8,7-billion due primarily to the EDS acquisition. Revenue in technology services was flat. ITO, application services and BPO posted revenue of $3,9-billion, $1,6-billion and $743-million, respectively. Operating profit was $1,1-billion, or 12,8% of revenue, up from $499-million, or 12,3% of revenue, in the prior-year period.
HP Software revenue declined 7% to $878-million. Business technology optimization portfolio revenue declined 4% while other software revenue was down 14%. Operating profit was $140-million, or 15,9% of revenue, up from $49-million, or 5,2% of revenue, in the prior-year period.
HP Financial Services (HPFS) reported revenue of $636-million, down 1% from the prior-year period. Financing volume increased 2%, and net portfolio assets declined 3%. Operating margin was 6,4% of revenue, down from 6,7% in the prior-year period.
HP generated $1,1-billion in cash flow from operations for the first quarter. Inventory ended the quarter at $7,6-billion, down two days. Accounts receivable of $14,8-billion was up seven days. Accounts payable ended the quarter at $11,2-billion, down one day. HP's dividend payment of $0,08 per share in the first quarter resulted in cash usage of $193-million. HP utilised $1,2-billion of cash during the first quarter to repurchase approximately 34-million shares of common stock in the open market. HP exited the quarter with $11,3-billion in gross cash.
HP estimates second quarter FY09 revenue will decline approximately 2% to 3% from the prior-year period.
It expects full year FY09 revenue will decline approximately 2% to 5% from the prior-year period.