HP CEO Enrique Lores says nothing in his company’s latest quarterly numbers suggest economic growth is poised to fall off a cliff this year.
HP beat analyst profit forecasts for its fiscal second quarter, powered by strong sales of commercial computers as customers continue to bring workers back to the office. HP said commercial computer sales rose 18% in its most recent quarter.
“What we are seeing today continues to be very strong demand from the commercial side,” Lores told Yahoo Finance Live. “As we were expecting, we saw some slowdown in consumer. But nothing that tells us it’s going to be a major slowdown coming forward.”
Lores’ comments come as investors and executives exhibit some caution regarding the economy’s growth outlook, though experts have begun calling some of these recession fears “overblown.”
HP’s bottom line was also boosted by $1 billion in stock buybacks.
Here is how HP performed compared to Wall Street estimates in its second fiscal quarter:
The strength in commercial computers comes alongside more mixed trends elsewhere in HP’s portfolio. Sales of consumer computers and printers fell 6% and 12%, respectively, from the prior year. Commercial printer sales dropped 4%.
Operating profit margins contracted 90 basis points in HP’s personal systems segment, but rose 110 basis points in the printing business.
The company raised its full year outlook despite ongoing supply-chain constraints and a slowing PC market.
For the third fiscal quarter, HP sees EPS in a range of $1.03-$1.08. Analysts had estimated earnings of $1.04 per share in the current quarter.
The company also lifted its full-year earnings outlook to $4.24-$4.38 per share from $4.18-$4.38 previously. Wall Street had been modeling for full-year earnings of $4.26 per share.
“I think consistency is the key message,” Lores added.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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