HP to cut 1,300 jobs

[jamesinca]

HP to cut 1,300 jobs
Pallid quarter falls short by $100 million

Carrie Kirby, Chronicle Staff Writer Wednesday, August 20, 2003

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Hewlett-Packard announced Tuesday that it will cut an additional 1,300 jobs after missing Wall Street expectations for its third-quarter earnings.

The disappointing quarter, in which sales fell $100 million below expectations, came after a rosy second quarter that many took as a happy ending to HP's 2002 acquisition of Compaq Computer.

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"The thing that's troubling is the inconsistency of the results. . . . The true profitability of the combined company is yet to be determined," said Joel Wagonfeld, an analyst with Banc of America Securities. Wagonfeld does not own HP stock. The company has provided banking services to HP in the past year.

Excluding one-time charges, HP earned 23 cents per share, 3 cents below consensus estimates. With the charges, the company earned $297 million (10 cents per share) compared with a year ago, when it lost $2.03 billion (67 cents per share). Revenue was $17.3 billion, up from $16.5 billion the year before.

<SNIP>

Disappointed investors drove HP shares down 10 percent in after-hours trading, to $19.97 from its regular-trading close of $22.11.


HP's shaky third quarter

-- Profit was 23 cents per share, or 3 cents below the consensus forecast.

-- Sales were $100 million less than expected.

-- 1,300 more layoffs were announced.

-- PC division suffered a $56 million loss after gains in two previous quarters.

Source: Hewlett-Packard

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2003/08/20/BU245383.DTL

[caribmon]

1. It's off

To India we go... sang the suits as they opened up doors in Bangalore...

[jamesinca]

2. They may send them to India to save money and keep production

I think this has to do with bad planning and not getting rid of the suits that make these bad ideas. On the same page of the S.F. Chronicle is an opinion by David Lazarus. Schwab rewards its board with raises while cutting 250 jobs. The suits received up to 100% increases in bonuses for attending board meetings, in addition to their salary, while laying off 250 employees.