Hewlett-Packard Beats on EPS but GAAP Results Lag

Hewlett-Packard (NYSE: HPQ  ) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Jan. 31 (Q1), Hewlett-Packard missed estimates on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue dropped and GAAP earnings per share shrank significantly.

Margins shrank across the board.

Revenue details
Hewlett-Packard reported revenue of $30.04 billion. The 25 analysts polled by S&P Capital IQ predicted a top line of $30.66 billion on the same basis. GAAP reported sales were 7.0% lower than the prior-year quarter's $32.30 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.92. The earnings estimates compiled by S&P Capital IQ forecast $0.87 per share on the same basis. GAAP EPS of $0.73 for Q1 were 38% lower than the prior-year quarter's $1.17 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 22.4%, 220 basis points worse than the prior-year quarter. Operating margin was 7.0%, 420 basis points worse than the prior-year quarter. Net margin was 4.9%, 320 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $30.31 billion. On the bottom line, the average EPS estimate is $0.94.

Next year's average estimate for revenue is $123.75 billion. The average EPS estimate is $4.08.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 3,425 members out of 3,733 rating the stock outperform, and 308 members rating it underperform. Among 821 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 772 give Hewlett-Packard a green thumbs-up, and 49 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Hewlett-Packard is hold, with an average price target of $31.28.

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