Profitable printers of HP all set to buy time for Whitman

Meg Whitman, CEO at HP

Meg Whitman, CEO at HP

There is a list of things that HP CEO Whitman has decided to do for HP in order to do good for the company. The strategies are designed for better competence of HP on the enterprise services and bringing a halt to the rapid decline in the personal computer unit of the company. HP CEO Whitman also plans to dish out new strategies in the worldwide market of computer sales that is being overshadowed by some high end and smart mobile devices.

Viewpoint of Meg Whitman:

According to the latest reports some of these sound strategies by the HP CEO Whitman have still kept the hopes alive for the fall in printer sales of the well established Hewlett-Packard Company. Turnaround plans developed by the HP CEO Whitman in the past few months include their battling against companies like Dell Inc. and IBM for corporate products and services. Even though it has lost a portion of its shine and dominance, the Hewlett-Packard printer sale still accounts for nearly 35 to 40 percent of the annual profit of the company. According to Shaw Wu, who is an analyst with Sterne Agee, in spite of the fact that the Hewlett-Packard printer sale has dropped quite a bit, this is not the major area of concern for the company.

The market status of HP:

There has been a fall in all the areas of main business of HP in the last quarter including a 10 percent slide on the PC unit itself. There was a 28 percent decline in the operating profit that was marked in the PC unit that accounted for the biggest slide being followed by a 22 percent slide in the services section. In comparison to that fall in printer sales was accounted to about 2.7 percent in the July quarter even though its operating profit saw an increase of 8 percent. The Hewlett-Packard printer sale gathered around $949 million out of the total operating income of $3.1 million in the quarter. Wu is, however, speculating a fall in printer sales of HP this fiscal year by nearly $1 billion thereby coming down to somewhere around $25 billion by the end of the month of October.

The printing and imaging business of HP:

The Hewlett-Packard printer sale has a historic significance to the business of the company bringing about a high range of profit to the sales and the operating margin of the company. The sale of the printer cartridges alone in the last quarter brought about a 16 percent operating margin to the company. But the company is facing tough challenges due to the fall in printer sales. In an era when the world is turning towards smartphones and tablets, the HP CEO Whitman is devising new ways to keep their business alive in the global market. The situation has now come to a point where printer companies like Xerox Corp., Lexmark and Canon are either closing their business or are curtailing them due to the fall in margins, intense competition and gradual inclination towards mobile phones and tablets.

Aubrey Chang
Aubrey Chang, Associate Editor Industry Leaders Magazine (www.industryleadersmagazine.com)

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