Horror quarter for HP as net earnings drop 15%, consumer device revenue collapses by 22%

HP has announced a shake-up of its senior management team after announcing a large 15% drop in net earnings and a 22% drop in revenue from consumer devices during the fiscal third quarter.

The tech giant reported an 8% year-on-year drop in net revenue, from $US29.7 billion to $US27.2 billion, with net earnings slumping from $US2 billion to $US1.7 billion.

The biggest revenue drop happened in the company’s core personal systems business, which includes desktop PCs and other end user devices.

While commercial sales within the division were down by 3%, consumer device sales crashed by 22%, led by an 8% drop in desktop PC sales and a 14% plunge in netbook sales.

The revenue drops were mirrored across most of the company’s other businesses, with a 4% drop in its printing division, 9% fall in enterprise services and a 6% drop for financial services.

The only division to avoid a revenue drop was software, which marked a small 1% increase in revenues.

Shortly after the release of the figures, the company announced a major leadership shakeup, with HP’s chief operating officer, Bill Veghte, became executive vice president and general manager of the HP Enterprise Group, with no replacement named.

The company is also combining its marketing and communications departments under the leadership of chief communications officer Henry Gomez.

As SmartCompany recently reported, HP saw its shipments fall 4.8% from 13.03 million to 12.4 million.

The figures also show the overall PC market slumped to 76 million units worldwide during the second quarter of 2013, 10.9% down from 85.3 million year-on-year.

The figures represented the fifth consecutive quarter of year-on-year declines in the troubled sector, coming on top of the 13.9% year-on-year decline shown in IDC’s first quarter figures.

The horror result for HP comes less than a week after key rival Dell reported a massive 72% drop in quarterly profits.