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What's in Store for Hewlett-Packard's Last Earnings Results?

After about a year of consideration, Hewlett-Packard Company ("Hewlett-Packard") successfully split itself into two standalone companies - HP Inc.HPQ and Hewlett-Packard Enterprise HPE - effective Nov 1, 2015. The two companies are now scheduled to jointly release the fourth-quarter fiscal 2015 results of the parent company on Nov 24.

In Oct 2014, Hewlett-Packard announced that it will split its enterprise-facing hardware and service business and the consumer-facing computer and printer segments, into two publicly trading companies.

Prior to the split, Hewlett-Packard was a leading global provider of computing products, technologies, software and services to individual consumers, SMBs and large enterprises, including those in the public and educational sectors. Products such as PCs and access devices, imaging and printing-related products and services, enterprise IT infrastructure and multi-vendor customer services including support, maintenance, consulting, integration and outsourcing were offered by the company.

However, Hewlett-Packard's PC business has been struggling over the past few years because of the persistent decline in PC shipment. As the business accounts for approximately 50% of the company's revenues, the reduction in business volume in this segment might hurt results in the to-be-reported quarter.

Hewlett-Packard is also witnessing secular decline due to increasing shift to tablets and smartphones where it is yet to gain a foothold. This is expected to negatively impact the fourth-quarter performance.

Nonetheless, the cost cutting initiatives are encouraging. Moreover, the company's traction in the cloud, security and Big Data segments are likely to partially offset the loss from the PC business in the fourth quarter.

However, macroeconomic challenges and tepid IT spending remain the near-term concerns. Competition from International Business Machines IBM and Oracle Corporation ORCL add to the woes.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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