HP's profits fall 13 percent
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May 15, 1998: 9:02 a.m. ET
Second-quarter income weakens on Asian turmoil, competitive PC pricing
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NEW YORK (CNNfn) - Hewlett-Packard Co. on Friday reported a 12.6 percent drop in second-quarter net income, following through on its profit warning two days earlier.
For the quarter ended April 30, net earnings fell to $685 million, or 65 cents a share, from $784 million, or 75 cents, in the second quarter last year.
However, revenue rose 16 percent to $12 billion from $10 billion a year earlier.
"While our solid revenue and order growth this quarter shows that we're addressing real customer needs, our earnings performance fell well short of expectations," said Lewis E. Platt, chairman, president and chief executive.
Profitability was affected by pricing pressure in PCs, troubled Asian economies and higher operating-expense, which Platt characterized as "unacceptable."
Revenue growth in the Asia Pacific region amounted to 1 percent as opposed to double-digit growth rates in Europe and Latin America.
Following Wednesday's surprising profit warning, HP stock (HWP) plunged 11-5/16 to 70-5/16 on Thursday.
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Hewlett-Packard
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