Business at its enterprise group, the lynchpin of HP’s strategy to transform itself into an IBM-like provider of enterprise computing services, edged 1 percent higher as server sales fared better than analysts had expected. Chief Executive Officer Meg Whitman said growth in revenue and operating margins in that crucial division was “possible,” provided demand from enterprises holds up.
Whitman, who took the helm of the HP more than a year ago, has said she expects revenue to stabilize in 2014, with some areas of growth for the company.
On Thursday, Whitman stuck to that outlook and told Reuters she was upbeat on HP’s European business as the developed part of that region stabilized, and she said she saw strength in emerging markets like India and Mexico. She added that HP’s business in China stayed largely flat, better than competitors had fared.
“Pleased with the progress, more work to be done,” Whitman summarized for Reuters in an interview.
“It’s a battle. It’s a knife fight every single day out there, but we feel we’ve got the right ammunition,” she told analysts later.
On Thursday, HP raised the lower end of its full-year earnings outlook slightly, to $3.60 to $3.75 versus a previous forecast for $3.55 to $3.75.
For the first quarter, HP posted revenue of $28.2 billion, down slightly from $28.4 billion a year earlier and beating expectations for about $27.2 billion.
“They’re in a strong position to do well this year, but it also shows the continued challenges in their enterprise business, their software business,” said Shannon Cross of Cross Research. “They’re clearly not done in terms of improving.”