Maker of expensive printer ink HP reported a loss in its fiscal 2023 first quarter and CEO Enrique Lores even trotted out the old “industry-wide headwinds” cliché as the reason.
He claimed that corporate budgets were being tightened, and this was impacting large enterprise demand for the vendor.
GAAP net revenues came in at $13.8 billion, representing an 18.8 per cent slump from the $17 billion earned in Q1 2022. GAAP net earnings plunged 55 per cent to $500 million compared to the previous year’s $1.1 billion.
Lores said: “We delivered on our non-GAAP EPS target despite industry-wide headwinds, reflecting disciplined execution across our business.”
So in otherwords it was not our fault, it was the wind that did it. However, he said that HP’s Future-Ready plan was working wonders and was reducing costs while maintaining investments in long-term growth.
While HP’s Future Ready plan sounds a lot like Boris Johnson’s Oven-Ready Brexit deal it is basically a cost cutting programme for long-term sustainable growth. Of course this has meant sacking a lot of workers — between 4,000 to 6,000 people from its workforce by 2025.
In Q1 2023, Lores revealed HP delivered on its cost target for the quarter, adding it is on track to provide at least 40 per cent of its three-year savings by the end of fiscal year 2023.
HP’s said its hybrid work arm more than doubled year on year following its $3.3 billion acquisition of videoconferencing giant Poly in August.
HP’s boss said that it was doubling down on services and subscriptions as there was growing demand for new consumption models.
“We have created dedicated teams to drive greater focus on these growth opportunities,” HP’s boss said.
The vendor saw soft demand in consumer and commercial for its personal systems business, which fell 24 per cent year on year to $9.2 billion.
The group experienced pricing pressure given elevated channel inventory across the industry.
