Shortly after releasing its quarterly results, shares of computer hardware producer HP Inc. (HPQ) were hit hard on the stock market. With a loss of 13.7%, it is safe to say investors were disappointed by the results and guidance from the Palo Alto-based company. The company reported a miss at the topline (revenues of USD 12.66 billion vs USD 12.68 billion) and at the bottom line (its earnings per share of USD 0.93 were 3 cents below analyst’s estimates). But the main problem was the poor outlook. For the coming quarter, the company sees quarterly earnings of USD 0.33-0.36, compared to USD 0.42 expected by the market. Also the full year guidance was cut to USD 1.59-1.69.
HP Inc. is the PC and printer business of the old HP (Compaq) company, the cloud and computer services part is now HP Enterprises (HPE). HP Inc. is struggling with weak sales for PCs and printers. As we all know, consumers are not buying as much desktops and laptops as in the past, due to competition from tablets and other mobile devices. There’s still much to say for the advantages of a desktop at home, but since a large part of computer time is online these days, consumers are not that into computers as they were a decade ago. In addition, printing declined as well. It’s easy to read documents on a tablet and many companies implemented policies to reduce printing to save toners, cartridges and paper. As a result, the printing business is in a steady decline. To be fair, the majority of HP Inc.’s