SAN JOSE, Calif. — Hewlett-Packard will launch a line of 3D printers next year to spark growth. Word of the plan came at the end of a call with financial analysts to discuss marginally upbeat results for the quarter and year.
The computer and printer company aims to release consumer and industrial-grade 3D printers in 2014, leveraging its massive paper printing business. But chief executive Meg Whitman, who first discussed the plan late last month, said on the call that the impact on the still-struggling corporation's bottom line will be modest for some time.
"This is an acorn in 2014 and 2015 with very good long potential," Whitman said. "There's a lot of potential to print in ways most consumers and companies would find acceptable," and 3D printers use "some of the same technologies" as HP's paper printer group.
Printer and PC sales were dropped marginally, though HP claimed its results outperformed declines in the overall industry. For the fiscal year that ended Oct. 31, HP's revenue fell 7% to $112.2 billion. The company eked out a $5.1 billion profit following a $12.6 billion loss in 2012. It expects earnings per share in the coming fiscal year to rise slightly to a range of $2.85 to $3.05.
HP's "turnaround was not linear," but the company is making "great progress," especially in reducing debt and improving cashflow, Whitman said. Nevertheless, continued challenges are expected in its core businesses. Industrywide shipments of traditional PCs fell 9.5% in the last three months amid rising DRAM prices. And Cathy Lesjack, HP's chief financial officer, said revenue declines could be even steeper this quarter as a result of continued high memory prices.
A Canalys report says tablets could make up half the PC market in 2014. Seeking traction in that market, HP is shipping convertible notebooks with screens and keyboards that can detach or fold to create tablets. "It's too early to tell how demand for convertibles is going," Whitman said. "We have a lot of innovative form factors, and we'll know more after this Christmas season."
As many as 24,600 people left HP last year as it cut about $2 billion in labor costs, including a significant part of its R&D in Unix servers. Another 33,000 or more will leave in 2014 as HP tries to trim another $1.1 billion. That said, HP added to its overall engineering ranks in its last fiscal year. In 2014, it aims to increase its overall R&D spending, which slumped in the last 12 months.
Networking gear and servers were the only bright spots in otherwise depressed sales for the year. Even in those sectors, sales growth was razor thin. HP reported these fiscal 2013 results.
- Networking and server revenue rose 2% from the previous year with a 14.5% operating margin.
- Printing revenue fell 1% with a 17.7% operating margin.
- Personal systems revenue fell 2% with a 3% operating margin.
- Software revenue fell 9% with a 30.8% operating margin.
- Enterprise services revenue declined 9% with a 4.4% operating margin.
— Rick Merritt, Silicon Valley Bureau Chief, EE Times