HP has strong PC, software sales, but Q2 profit dips

Hewlett-Packard's net profit declined but sales growth was strong in software and PCs in second quarter financial results out Wednesday.

Helped by double-digit sales growth in PCs and software from its Mercury Interactive acquisition, Hewlett-Packard reported a 27 percent increase in operating profit on a 13 percent rise in revenue in fiscal second quarter financial results released Wednesday. But net profit slipped by 7 percent from the same quarter last year.

HP reported net income of US$1.8 billion, or US$0.65 a share, on revenue of US$25.5 billion, for the three months that ended April 30, compared to net profit of US$1.9 billion, or US$0.66 a share on revenue of US$22.55 billion in the second quarter of 2006. Operating profit came in at US$2.1 billion.

Net profit from the same quarter last year was affected by a favorable tax ruling by the U.S. Internal Revenue Service that added US$0.15 cents to HP's earnings per share.

Revenue for its Personal Systems Group rose 24 percent to US$8.7 billion, including notebook computer sales growth of 45 percent, for the most recent quarter reported.

The HP Software Group had revenue growth of 54 percent to US$523 million. HP didn't own Mercury in the second quarter of last year.

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