NEW YORK – HP Inc.’s sales missed Wall Street targets in the most recent quarter, weighed down by the weaker-than-expected sales of printing supplies to commercial customers.
Part of the problem, company officials said, was overestimating demand after relying on “lagging and incomplete market share surveys.” Also more commercial customers bought items online, a shift that Chief Executive Dion Weisler said will require the printer and personal-computer giant to expand and strengthen its digital presence. The printing segment, which includes items like ink and laser cartridges to 3D printers, drives most of HP’s profit.
“We need new weapons to fight on our new battlefield,” Weisler said in a conference call with analysts. “We can’t just bring a musket to a drone fight.”
Shares in HP fell 13% in after-hours trading.
Revenue from the printing segment, which includes the supplies business, fell to $5.06 billion from $5.08 billion a year earlier.
Meanwhile, sales in the personal-systems segment, which includes its PC business, rose 2.3% to $9.66 billion, also missing analysts’ expectations. Total units sold fell 3% from the year earlier, as notebook units sold declined 1% and sales of desktops fell 8%, HP said.
Overall, HP reported a first-quarter profit of $803 million, or 51 cents a share, down 59% from the year earlier, when the Palo Alto, Calif., company got a boost from the U.S. tax overhaul. Excluding restructuring charges and other items, profit was in line with analysts’ estimates at 52 cents a share, up from 48 cents a share a year earlier.
Revenue rose 1.3% to $14.71 billion, though analysts polled by FactSet expected $14.86 billion.
This quarter, HP expects earnings of 45 cents to 48 cents a share, or 50 cents to 53 cents a share on an adjusted basis. Analysts expect a profit of 51 cents a share, or 53 cents a share as adjusted.
The company affirmed its adjusted profit forecast of $2.12 to $2.22 a share.