Earnings showcontinued struggle

san francisco » Hewlett-Packard Co.’s latest earnings report shows that despite three years of efforts to turn its business around, the venerable tech giant still has a lot more work ahead.

CEO Meg Whitman has decided to split the pioneering SiliconValley company in two. But she has said it will take a year to disengage the sluggish printer-and-PC division fromunits that sell commercial tech hardware, software and services, where Whitman believes there are more opportunities for growth. Meanwhile, the company reported Tuesday that its sales fell 2 percent in the most recent three-month period, marking its 12th revenue decline in the past 13 quarters.

Profit was down 6 percent from a year ago. For the August-October fiscal quarter, HP reported net income of $1.3 billion, or 70 cents a share, on revenue of $28.4 billion. That fell short of the expectations of analysts polled by FactSet, who predicted earnings of 80 cents a share on revenue of $28.7 billion.

And there was little comfort in a new forecast issued Tuesday by the market research firm IDC. Although the firm says PC sales should level out in the next fewyears, “no signifi- cant growth” is expected. The only “good” news is that the global PC market won’t shrink as much this year. IDCnowexpects the decline to be 2.7 percent rather than 3.7 percent, as forecast earlier.

PCsales have suffered as consumers increasingly turn to smartphones and other mobile devices. Yet it’s the biggest single part of HP’s business, accounting for more than 30 percent of the company’s nearly $112 billion in annual revenue.