HP FYQ4 Beats, Q1, FY12 View Weak; ‘Cautious’ Posture

Hewlett-Packard (HPQ) this afternoon reported fiscal Q4 revenue and earnings per share ahead of analysts’ expectations but forecast the current quarter and the full year to fall below estimates.

Revenue in the three months ended in October fell 3% to $32.3 billion, yielding EPS of $1.17, excluding some costs.

Analysts on average were expecting $32.05 billion and $1.13 per share.

For the current quarter, the company sees EPS of 83 cents to 86 cents, well below the average $1.11 estimate. For the full year ending next October, the company sees EPS of $4 per share, below the average $4.84.

CEO Meg Whitman, who came aboard in September, made her first statement about the state of the company in conjunction with an earnings call:

HP has a great opportunity to build on our strong hardware, software, and services franchises with leading market positions, customer relationships, and intellectual property.�We need to get back to the business fundamentals in fiscal 2012, including making prudent investments in the business and driving more consistent execution.

CFO Cathie Lesjak remarked that the company is “cautious heading into fiscal year 2012.”

Services revenue rose about 2% in the quarter from the prior-year period. Enterprise division sales dropped 4%, though networking products revenue rose 5%. “Industry-standard servers” revenue was down 4%. Software revenue rose 28%, year over year, with license growth of 33%.

And the Personal Systems Group division, containing the PC business, saw revenue fall 2%, year over year, hindered by a 9% drop in consumer client revenue. The Imaging and Printing group’s revenue fell 10%.

Almost all of those metrics were a deterioration from FYQ3′s level on a growth and margin basis. However, software seems to have actually improved from the prior quarter, when growth was just 20%. Software’s operating margin improved from 19.4% in Q3 to 27.7%. (See HP’s fiscal Q3 press release for the prior quarter’s results.)

HP’s non-GAAP operating margin in the quarter fell slightly to 9.7% from 9.8% in the prior quarter, and was well down from the year-earlier 12%.

HP shares are rising in late trading, up 92 cents, or 3.5%, at $27.75.

HP will hold a conference call with analysts at 5 pm, Eastern time, and you can catch it via Webcast here.