HP Profit Plummets, CEO Urges Patience

(Reuters) -- Hewlett-Packard Co's earnings fell nearly 44 percent and the world's No. 1 computer maker forecast a second-quarter profit below Wall Street estimates as it struggles with weak sales of PCs and printers.

The storied Silicon Valley company, which has been trying to move past the internal upheaval that marked 2011, posted quarterly sales declines in three of its key units: personal computers, printers and enterprise equipment.

Chief Executive Meg Whitman, a veteran Silicon Valley executive who took the top job last September after the firing of Leo Apotheker, has been trying to turn around HP's sprawling businesses. On Wednesday, she pleaded for a little patience.

If you look at business history and you look at companies which have gone through the kind of turnaround that we're leading HP through right now, these things are not quick, she said, adding it could anywhere from two to five years.

It took us a while to get into the situation in which we find ourselves. It's going to take us a little while to get out.

Last year was a turbulent one for the company, marked by strategy flip-flops, executive churn and the ouster of Apotheker after less than a year in the top job.

NO BRIGHT SPOTS

Fiscal first-quarter revenue fell 7 percent to $30 billion, slightly below Wall Street's consensus estimate.

Sales from the personal systems group, encompassing PCs, declined 15 percent, which executives blamed partly on a persistent shortage of hard drives globally - the result of flooding last year in Thailand.

Revenue from its bread-and-better printing group - which Whitman called the lifeblood of the company on Wednesday - fell 7 percent, hurt by weak consumer demand as the U.S. economy continued to struggle.

Even sales of enterprise servers, storage and networking equipment - usually a bright point for HP - fell 10 percent.

On Wednesday, HP reported net income of $1.47 billion for the fiscal first quarter, or 73 cents a share, down from $2.6 billion, or $1.17 a share, a year earlier.

Excluding items, HP earned 92 cents a share, above the average analyst estimate of 87 cents according to Thomson Reuters I/B/E/S.

Looking to the current, fiscal second quarter, HP said it expects non-GAAP diluted earnings of 88 to 91 cents a share, below Wall Street estimates.

It reiterated its full-year non-GAAP earnings outlook of at least $4 per share.

HP shares slid to around $28.65 in after-hours trading. They shed 1.39 percent in the regular session to close at $28.94 on the New York Stock Exchange.

(Reporting By Poornima Gupta; editing by Richard Chang and Andre Grenon)