HP REPORTED quarterly revenue that missed estimates, battered by the ongoing slump in personal computer (PC) sales.

Revenue declined 4.4 per cent to US$13.2 billion in the period ended Jan 31, compared with analysts’ average projection of US$13.6 billion. Profit, excluding some items, was 81 US cents a share, in line with Wall Street estimates.

The underperformance came from the company’s PC business. After two years of declining revenue in HP’s consumer PC unit, analysts projected a sales increase in the quarter. Instead, consumer sales slipped 1 per cent to US$2.8 billion and commercial PC revenue declined 5 per cent to US$6.1 billion, the Palo Alto, California-based company said on Wednesday (Feb 28). Both units performed worse than expected. Printer division revenue was in line with estimates at US$4.4 billion.

Still, the company expects PC sales to increase in 2024, said chief executive officer Enrique Lores. That will be driven by a rebound in corporate spending, new computers tied to Microsoft’s Windows 11 software and some modest impact from artificial-intelligence ready PCs, he added.

HP maintained its previous outlook for the current year ending in October 2024. Free cash flow will be US$3.1 billion to US$3.6 billion. Adjusted profit is projected at US$3.25 to US$3.65 a share.

The shares fell 7.6 per cent in extended trading after closing at US$28.72 in New York. The stock has declined 4.6 per cent this year.

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The PC market has gone through a downturn “unparallelled in the industry’s recorded history” in recent years, analyst firm IDC wrote last month in a report, adding that holiday season shipments were the lowest since 2006. IDC, however, also expects that growth will finally return this year as “contractions appear to have bottomed out”.

HP repurchased about US$500 million in shares during the quarter, and will continue to buy back stock this year, Lores said. Several tech companies including Zoom Video Communications and Meta Platforms have recently announced stock buyback plans. BLOOMBERG