HP Reports Fiscal 2015 Second Quarter Results

Fiscal 2015 second quarter segment results

  • Personal Systems revenue was down 5% year over year with a 3.0% operating margin. Commercial revenue decreased 7% and Consumer revenue decreased 2%. Total units were up 2% with Notebooks units up 19% and Desktops units down 14%.
  • Printing revenue was down 7% year over year with an 18.3% operating margin. Total hardware units were down 4% with Commercial hardware units up 1% and Consumer hardware units down 6%. Supplies revenue was down 5%.
  • Enterprise Group revenue was down 1% year over year with a 14.5% operating margin. Industry Standard Servers revenue was up 11%, Storage revenue was down 8%, Business Critical Systems revenue was down 15%, Networking revenue was down 16% and Technology Services revenue was down 8%. Additionally, HP closed its acquisition of Aruba in May.
  • Enterprise Services revenue was down 16% year over year with a 4.0% operating margin. Infrastructure Technology Outsourcing revenue was down 20%, and Application and Business Services revenue declined 8%.
  • Software revenue was down 8% year over year with a 17.9% operating margin. License revenue was down 17%, support revenue was down 2%, professional services revenue was down 15% and software-as-a-service (SaaS) revenue was down 5%.
  • HP Financial Services revenue was down 7% year over year with a 2% decrease in net portfolio assets and a 1% decrease in financing volume. The business delivered an operating margin of 10.6%.

More information on HP's earnings, including additional financial analysis and an earnings overview presentation, is available on HP's Investor Relations website at www.hp.com/investor/home.

HP's FY15 Q2 earnings conference call is accessible via an audio webcast at www.hp.com/investor/2015Q2Webcast.

About HP
HP creates new possibilities for technology to have a meaningful impact on people, businesses, governments and society. With the broadest technology portfolio spanning printing, personal systems, software, services and IT infrastructure, HP delivers solutions for customers' most complex challenges in every region of the world. More information about HP is available at http://www.hp.com.

Use of non-GAAP financial information
To supplement HP's consolidated condensed financial statements presented on a generally accepted accounting principles (GAAP) basis, HP provides revenue on a constant currency basis, as well as non-GAAP operating profit, non-GAAP operating margin, non-GAAP net earnings, non-GAAP diluted net earnings per share, gross cash, free cash flow, net capital expenditures, net debt, net cash, operating company net debt and operating company net cash financial measures. HP also provides forecasts of non-GAAP diluted net earnings per share. A reconciliation of the adjustments to GAAP results for this quarter and prior periods is included in the tables below or elsewhere in the materials accompanying this news release. In addition, an explanation of the ways in which HP's management uses these non-GAAP measures to evaluate its business, the substance behind HP's decision to use these non-GAAP measures, the material limitations associated with the use of these non-GAAP measures, the manner in which HP's management compensates for those limitations, and the substantive reasons why HP's management believes that these non-GAAP measures provide useful information to investors is included under "Use of non-GAAP financial measures" after the tables below. This additional non-GAAP financial information is not meant to be considered in isolation or as a substitute for revenue, operating profit, operating margin, net earnings, diluted net earnings per share, cash and cash equivalents, cash flow from operations, capital expenditures, or total company debt prepared in accordance with GAAP.

Forward-looking statements
This news release contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of HP may differ materially from those expressed or implied by such forward-looking statements and assumptions.

All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any projections of revenue, margins, expenses, effective tax rates, net earnings, net earnings per share, cash flows, benefit plan funding, share repurchases, currency exchange rates or other financial items; any projections of the amount, timing or impact of cost savings or restructuring charges; any statements of the plans, strategies and objectives of management for future operations, including the previously announced separation transaction and the future performances of the post-separation companies if the separation is completed, as well as the execution of restructuring plans and any resulting cost savings or revenue or profitability improvements; any statements concerning the expected development, performance, market share or competitive performance relating to products or services; any statements regarding current or future macroeconomic trends or events and the impact of those trends and events on HP and its financial performance; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief; and any statements or assumptions underlying any of the foregoing.

Risks, uncertainties and assumptions include the need to address the many challenges facing HP's businesses; the competitive pressures faced by HP's businesses; risks associated with executing HP's strategy, including the planned separation transaction; the impact of macroeconomic and geopolitical trends and events; the need to manage third-party suppliers and the distribution of HP's products and the delivery of HP's services effectively; the protection of HP's intellectual property assets, including intellectual property licensed from third parties; risks associated with HP's international operations; the development and transition of new products and services and the enhancement of existing products and services to meet customer needs and respond to emerging technological trends; the execution and performance of contracts by HP and its suppliers, customers and partners; the hiring and retention of key employees; integration and other risks associated with business combination and investment transactions; the execution, timing and results of the separation transaction or restructuring plans, including estimates and assumptions related to the cost (including any possible disruption of HP's business) and the anticipated benefits of implementing the separation transaction and restructuring plans; the resolution of pending investigations, claims and disputes; and other risks that are described in HP's Annual Report on Form 10-K for the fiscal year ended October 31, 2014, and HP's other filings with the Securities and Exchange Commission, including HP's Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2015.

As in prior periods, the financial information set forth in this release, including tax-related items, reflects estimates based on information available at this time. While HP believes these estimates to be reasonable, these amounts could differ materially from reported amounts in HP's Quarterly Report on Form 10-Q for the fiscal quarter ended April 30, 2015. HP assumes no obligation and does not intend to update these forward-looking statements.

                                                                            
                  HEWLETT-PACKARD COMPANY AND SUBSIDIARIES                  
               CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS                
                                (Unaudited)                                 
                  (In millions, except per share amounts)                   
                                                                                          
                                                                                                Three  months  ended                    
                                                                            -------------------------------------  
                                                                              April  30,      January  31,      April  30,    
                                                                                    2015                  2015                  2014        
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
Net  revenue                                                      $        25,453    $        26,839    $        27,309  
                                                                                                                                                        
Costs  and  expenses:                                                                                                                  
    Cost  of  sales                                                        19,345              20,571              20,704  
    Research  and  development                                        850                    825                    873  
    Selling,  general  and  administrative              3,063                3,071                3,391  
    Amortization  of  intangible  assets                      221                    222                    264  
    Restructuring  charges                                              255                    146                    252  
    Acquisition-related  charges                                    19                        4                        3  
    Separation  costs                                                        269                      80                        -  
                                                                            -----------    -----------    -----------  
        Total  costs  and  expenses                              24,022              24,919              25,487  
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
Earnings  from  operations                                        1,431                1,920                1,822  
                                                                                                                                                        
Interest  and  other,  net                                            (139)                (174)                (174)
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
Earnings  before  taxes                                              1,292                1,746                1,648  
                                                                                                                                                        
Provision  for  taxes                                                    (281)                (380)                (375)
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
Net  earnings                                                    $          1,011    $          1,366    $          1,273  
                                                                            ===========    ===========    ===========  
                                                                                                                                                        
Net  earnings  per  share:                                                                                                          
    Basic                                                              $            0.56    $            0.75    $            0.67  
    Diluted                                                          $            0.55    $            0.73    $            0.66  
                                                                                                                                                        
Cash  dividends  declared  per  share          $                  -    $            0.32    $                  -  
                                                                                                                                                        
                                                                                                                                                        
Weighted-average  shares  used  to                                                                                          
  compute  net  earnings  per  share:                                                                                        
    Basic                                                                          1,814                1,833                1,890  
    Diluted                                                                      1,836                1,861                1,916  
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                              CONSOLIDATED  CONDENSED  STATEMENTS  OF  EARNINGS                                
                                                                (Unaudited)                                                                  
                                    (In  millions,  except  per  share  amounts)                                      
                                                                                                                                                        
                                                                                                              Six  months  ended          
                                                                                                                      April  30,                
                                                                                                      ------------------------  
                                                                                                              2015                  2014        
                                                                                                      -----------    -----------  
                                                                                                                                                        
Net  revenue                                                                                $        52,292    $        55,463  
                                                                                                                                                        
Costs  and  expenses:                                                                                                                  
    Cost  of  sales                                                                                  39,916              42,440  
    Research  and  development                                                              1,675                1,684  
    Selling,  general  and  administrative                                        6,134                6,601  
    Amortization  of  intangible  assets                                                443                    547  
    Restructuring  charges                                                                        401                    366  
    Acquisition-related  charges                                                              23                        6  
    Separation  costs                                                                                  349                        -  
                                                                                                      -----------    -----------  
        Total  costs  and  expenses                                                        48,941              51,644  
                                                                                                      -----------    -----------  
                                                                                                                                                        
Earnings  from  operations                                                                  3,351                3,819  
                                                                                                                                                        
Interest  and  other,  net                                                                      (313)                (337)
                                                                                                      -----------    -----------  
                                                                                                                                                        
Earnings  before  taxes                                                                        3,038                3,482  
                                                                                                                                                        
Provision  for  taxes                                                                              (661)                (784)
                                                                                                      -----------    -----------  
                                                                                                                                                        
Net  earnings                                                                              $          2,377    $          2,698  
                                                                                                      ===========    ===========  
                                                                                                                                                        
Net  earnings  per  share:                                                                                                          
    Basic                                                                                        $            1.30    $            1.42  
    Diluted                                                                                    $            1.29    $            1.40  
                                                                                                                                                        
Cash  dividends  declared  per  share                                    $            0.32    $            0.29  
                                                                                                                                                        
                                                                                                                                                        
Weighted-average  shares  used  to  compute  net                                                                  
  earnings  per  share:                                                                                                                
    Basic                                                                                                    1,824                1,898  
    Diluted                                                                                                1,848                1,922  
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                ADJUSTMENTS  TO  GAAP  NET  EARNINGS,  EARNINGS  FROM  OPERATIONS,                  
                        OPERATING  MARGIN  AND  DILUTED  NET  EARNINGS  PER  SHARE                          
                                                                (Unaudited)                                                                  
                                    (In  millions,  except  per  share  amounts)                                      
                                                                                                                                                        
                                      Three        Diluted        Three        Diluted        Three      Diluted    
                                    months            net          months            net          months            net      
                                    ended        earnings      ended        earnings      ended        earnings  
                                      April            per          January          per            April            per      
                                  30,  2015        share      31,  2015        share      30,  2014        share    
                                  --------    --------    --------    --------    --------    --------  
                                                                                                                                                        
GAAP  net                                                                                                                                        
  earnings                $    1,011    $      0.55    $    1,366    $      0.73    $    1,273    $      0.66  
                                                                                                                                                        
Non-GAAP                                                                                                                                        
  adjustments:                                                                                                                              
    Amortization                                                                                                                            
      of  intangible                                                                                                                        
      assets                          221            0.12              222            0.12              264            0.14  
    Restructuring                                                                                                                          
      charges                        255            0.14              146            0.08              252            0.13  
    Acquisition-                                                                                                                            
      related                                                                                                                                    
      charges                          19            0.01                  4                  -                  3                  -  
    Separation                                                                                                                                
      costs                            269            0.15                80            0.04                  -                  -  
    Adjustments                                                                                                                              
      for  taxes                  (179)        (0.10)          (113)        (0.05)          (101)        (0.05)
                                  --------    --------    --------    --------    --------    --------  
Non-GAAP  net                                                                                                                                
  earnings                $    1,596    $      0.87    $    1,705    $      0.92    $    1,691    $      0.88  
                                  ========    ========    ========    ========    ========    ========  
                                                                                                                                                        
                                                                                                                                                        
GAAP  earnings                                                                                                                              
  from  operations  $    1,431                        $    1,920                        $    1,822                      
                                                                                                                                                        
Non-GAAP                                                                                                                                        
  adjustments:                                                                                                                              
    Amortization                                                                                                                            
      of  intangible                                                                                                                        
      assets                          221                                  222                                  264                      
    Restructuring                                                                                                                          
      charges                        255                                  146                                  252                      
    Acquisition-                                                                                                                            
      related                                                                                                                                    
      charges                          19                                      4                                      3                      
    Separation                                                                                                                                
      costs                            269                                    80                                      -                      
                                  --------                        --------                        --------                      
Non-GAAP                                                                                                                                        
  earnings  from                                                                                                                            
  operations            $    2,195                        $    2,372                        $    2,341                      
                                  ========                        ========                        ========                      
                                                                                                                                                        
GAAP  operating                                                                                                                            
  margin                                  6%                                    7%                                    7%                    
Non-GAAP                                                                                                                                        
  adjustments                        3%                                    2%                                    2%                    
                                  --------                        --------                        --------                      
Non-GAAP                                                                                                                                        
  operating                                                                                                                                    
  margin                                  9%                                    9%                                    9%                    
                                  ========                        ========                        ========                      
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                ADJUSTMENTS  TO  GAAP  NET  EARNINGS,  EARNINGS  FROM  OPERATIONS,                  
                        OPERATING  MARGIN  AND  DILUTED  NET  EARNINGS  PER  SHARE                          
                                                                (Unaudited)                                                                  
                                    (In  millions,  except  per  share  amounts)                                      
                                                                                                                                                        
                                                    Six  months        Diluted          Six  months        Diluted      
                                                        ended                  net                  ended                  net          
                                                    April  30,          earnings        April  30,        earnings      
                                                          2015            per  share              2014            per  share    
                                                  -----------    -----------    -----------    -----------  
                                                                                                                                                        
GAAP  net  earnings                $          2,377    $            1.29    $          2,698    $            1.40  
                                                                                                                                                        
Non-GAAP  adjustments:                                                                                                              
    Amortization  of                                                                                                                      
      intangible  assets                          443                  0.24                    547                  0.28  
    Restructuring  charges                    401                  0.22                    366                  0.19  
    Acquisition-related                                                                                                              
      charges                                                23                  0.01                        6                        -  
    Separation  costs                              349                  0.19                        -                        -  
    Adjustments  for  taxes                  (292)              (0.16)                (184)              (0.08)
                                                  -----------    -----------    -----------    -----------  
Non-GAAP  net  earnings        $          3,301    $            1.79    $          3,433    $            1.79  
                                                  ===========    ===========    ===========    ===========  
                                                                                                                                                        
                                                                                                                                                        
GAAP  earnings  from                                                                                                                    
  operations                            $          3,351                              $          3,819                            
                                                                                                                                                        
Non-GAAP  adjustments:                                                                                                              
    Amortization  of                                                                                                                      
      intangible  assets                          443                                              547                            
    Restructuring  charges                    401                                              366                            
    Acquisition-related                                                                                                              
      charges                                                23                                                  6                            
    Separation  costs                              349                                                  -                            
                                                  -----------                              -----------                            
Non-GAAP  earnings  from                                                                                                            
  operations                            $          4,567                              $          4,738                            
                                                  ===========                              ===========                            
                                                                                                                                                        
GAAP  operating  margin                            6%                                                7%                          
Non-GAAP  adjustments                              3%                                                2%                          
                                                  -----------                              -----------                            
Non-GAAP  operating                                                                                                                    
  margin                                                        9%                                                9%                          
                                                  ===========                              ===========                            
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                                        CONSOLIDATED  CONDENSED  BALANCE  SHEETS                                      
                                                                (In  millions)                                                              
                                                                                                                                                        
                                                                                                                            As  of                  
                                                                                                          -----------------------
                                                                                                            April  30,    October  31,
                                                                                                                  2015                2014      
                                                                                                          -----------  -----------
                                                                                                          (Unaudited)                        
ASSETS                                                                                                                                            
                                                                                                                                                        
Current  assets:                                                                                                                          
    Cash  and  cash  equivalents                                                    $        14,768  $        15,133
    Accounts  receivable                                                                          12,320            13,832
    Financing  receivables                                                                        2,842              2,946
    Inventory                                                                                                6,227              6,415
    Other  current  assets                                                                        12,726            11,819
                                                                                                          -----------  -----------
                                                                                                                                                        
        Total  current  assets                                                                    48,883            50,145
                                                                                                          -----------  -----------
                                                                                                                                                        
Property,  plant  and  equipment                                                          11,014            11,340
                                                                                                                                                        
Long-term  financing  receivables  and  other  assets                      8,552              8,454
                                                                                                                                                        
Goodwill  and  intangible  assets                                                        32,947            33,267
                                                                                                          -----------  -----------
                                                                                                                                                        
Total  assets                                                                                  $      101,396  $      103,206
                                                                                                          ===========  ===========
                                                                                                                                                        
                                                                                                                                                        
LIABILITIES  AND  STOCKHOLDERS'  EQUITY                                                                                
                                                                                                                                                        
Current  liabilities:                                                                                                                
    Notes  payable  and  short-term  borrowings                        $          5,594  $          3,486
    Accounts  payable                                                                                14,923            15,903
    Employee  compensation  and  benefits                                              3,145              4,209
    Taxes  on  earnings                                                                                1,144              1,017
    Deferred  revenue                                                                                  6,055              6,143
    Other  accrued  liabilities                                                              12,325            12,977
                                                                                                          -----------  -----------
                                                                                                                                                        
        Total  current  liabilities                                                          43,186            43,735
                                                                                                          -----------  -----------
                                                                                                                                                        
Long-term  debt                                                                                        15,464            16,039
                                                                                                                                                        
Other  liabilities                                                                                  15,577            16,305
                                                                                                                                                        
Stockholders'  equity:                                                                                                              
    HP  stockholders'  equity                                                                  26,768            26,731
    Non-controlling  interests                                                                    401                  396
                                                                                                          -----------  -----------
                                                                                                                                                        
        Total  stockholders'  equity                                                        27,169            27,127
                                                                                                          -----------  -----------
                                                                                                                                                        
Total  liabilities  and  stockholders'  equity                      $      101,396  $      103,206
                                                                                                          ===========  ===========
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                            CONSOLIDATED  CONDENSED  STATEMENTS  OF  CASH  FLOWS                              
                                                                (Unaudited)                                                                  
                                                              (In  millions)                                                                
                                                                                                                                                        
                                                                                                            Three                                  
                                                                                                            months          Six  months  
                                                                                                            ended                ended        
                                                                                                        April  30,        April  30,    
                                                                                                              2015                  2015        
                                                                                                      -----------    -----------  
Cash  flows  from  operating  activities:                                                                              
    Net  earnings                                                                          $          1,011    $          2,377  
    Adjustments  to  reconcile  net  earnings  to  net                                                            
      cash  provided  by  operating  activities:                                                                      
        Depreciation  and  amortization                                                1,003                2,031  
        Stock-based  compensation  expense                                              129                    316  
        Provision  for  doubtful  accounts  and  inventory                    102                    164  
        Restructuring  charges                                                                    255                    401  
        Deferred  taxes  on  earnings                                                          173                        -  
        Excess  tax  benefit  from  stock-based                                                                          
          compensation                                                                                      (9)                (118)
        Other,  net                                                                                          159                    297  
                                                                                                                                                        
        Changes  in  operating  assets  and  liabilities                                                          
          (net  of  acquisitions):                                                                                                  
            Accounts  receivable                                                                    (46)              1,494  
            Financing  receivables                                                                  23                    245  
            Inventory                                                                                        277                      53  
            Accounts  payable                                                                          (40)                (892)
            Taxes  on  earnings                                                                      (208)                    85  
            Restructuring                                                                              (220)                (703)
            Other  assets  and  liabilities                                            (1,145)            (3,542)
                                                                                                      -----------    -----------  
                Net  cash  provided  by  operating  activities                1,464                2,208  
                                                                                                      -----------    -----------  
                                                                                                                                                        
Cash  flows  from  investing  activities:                                                                              
        Investment  in  property,  plant  and  equipment                      (779)            (1,726)
        Proceeds  from  sale  of  property,  plant  and                                                              
          equipment                                                                                            81                    211  
        Purchases  of  available-for-sale  securities  and                                                    
          other  investments                                                                          (58)                (108)
        Maturities  and  sales  of  available-for-sale                                                            
          securities  and  other  investments                                              93                    123  
        Payments  made  in  connection  with  business                                                              
          acquisitions                                                                                  (138)                (139)
                                                                                                      -----------    -----------  
                Net  cash  used  in  investing  activities                          (801)            (1,639)
                                                                                                      -----------    -----------  
                                                                                                                                                        
Cash  flows  from  financing  activities:                                                                              
        Short-term  borrowings  with  original  maturities                                                    
          less  than  90  days,  net                                                            1,781                1,858  
        Issuance  of  debt                                                                          1,288                1,587  
        Payment  of  debt                                                                              (984)            (1,895)
        Issuance  of  common  stock  under  employee  stock                                                      
          plans                                                                                                    42                    223  
        Repurchase  of  common  stock                                                        (659)            (2,230)
        Excess  tax  benefit  from  stock-based                                                                          
          compensation                                                                                        9                    118  
        Cash  dividends  paid                                                                      (291)                (595)
                                                                                                      -----------    -----------  
                Net  cash  provided  by  (used  in)  financing                                                        
                  activities                                                                            1,186                  (934)
                                                                                                      -----------    -----------  
                                                                                                                                                        
Increase  (decrease)  in  cash  and  cash  equivalents                  1,849                  (365)
Cash  and  cash  equivalents  at  beginning  of  period                12,919              15,133  
                                                                                                      -----------    -----------  
Cash  and  cash  equivalents  at  end  of  period                  $        14,768    $        14,768  
                                                                                                      ===========    ===========  
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                                                        SEGMENT  INFORMATION                                                          
                                                                (Unaudited)                                                                  
                                                              (In  millions)                                                                
                                                                                                                                                        
                                                                                                Three  months  ended                    
                                                                            -------------------------------------  
                                                                              April  30,      January  31,      April  30,    
                                                                                    2015                  2015                  2014        
                                                                            -----------    -----------    -----------  
Net  revenue:(a)                                                                                                                          
                                                                                                                                                        
    Personal  Systems                                        $          7,740    $          8,544    $          8,176  
    Printing                                                                    5,453                5,543                5,834  
                                                                            -----------    -----------    -----------  
        Total  Printing  and  Personal                                                                                          
          Systems  Group                                                  13,193              14,087              14,010  
    Enterprise  Group                                                    6,561                6,981                6,633  
    Enterprise  Services                                              4,817                4,993                5,702  
    Software                                                                        892                    871                    971  
    HP  Financial  Services                                              805                    803                    867  
    Corporate  Investments                                                  2                      16                        6  
                                                                            -----------    -----------    -----------  
        Total  segments                                                  26,270              27,751              28,189  
    Elimination  of  intersegment  net                                                                                      
      revenue  and  other                                                  (817)                (912)                (880)
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
        Total  HP  consolidated  net  revenue  $        25,453    $        26,839    $        27,309  
                                                                            ===========    ===========    ===========  
                                                                                                                                                        
Earnings  before  taxes:(a)                                                                                                      
                                                                                                                                                        
    Personal  Systems                                        $              235    $              313    $              290  
    Printing                                                                        996                1,067                1,140  
                                                                            -----------    -----------    -----------  
        Total  Printing  and  Personal                                                                                          
          Systems  Group                                                    1,231                1,380                1,430  
    Enterprise  Group                                                        950                1,090                    957  
    Enterprise  Services                                                  194                    148                    148  
    Software                                                                        160                    157                    186  
    HP  Financial  Services                                                85                      90                      99  
    Corporate  Investments                                            (144)                (124)                  (98)
                                                                            -----------    -----------    -----------  
        Total  segment  earnings  from                                                                                          
          operations                                                          2,476                2,741                2,722  
                                                                                                                                                        
    Corporate  and  unallocated  costs  and                                                                              
      eliminations                                                            (152)                (182)                (251)
    Stock-based  compensation  expense                      (129)                (187)                (130)
    Amortization  of  intangible  assets                    (221)                (222)                (264)
    Restructuring  charges                                            (255)                (146)                (252)
    Acquisition-related  charges                                  (19)                    (4)                    (3)
    Separation  costs                                                      (269)                  (80)                      -  
    Interest  and  other,  net                                        (139)                (174)                (174)
                                                                            -----------    -----------    -----------  
                                                                                                                                                        
        Total  HP  consolidated  earnings                                                                                    
          before  taxes                                          $          1,292    $          1,746    $          1,648  
                                                                            ===========    ===========    ===========  
                                                                                                                                                        
(a)    Effective  at  the  beginning  of  its  first  quarter  of  fiscal  2015,  HP          
          implemented  an  organizational  change  to  align  its  segment  financial        
          reporting  more  closely  with  its  current  business  structure.  This              
          organizational  change  resulted  in  the  transfer  of  third  party  multi-      
          vendor  support  arrangements  from  the  Technology  Services  business  unit  
          within  the  Enterprise  Group  segment  to  the  Infrastructure  Technology      
          Outsourcing  business  unit  within  the  Enterprise  Services  segment.  HP      
          reflected  this  change  to  its  segment  information  in  prior  reporting        
          periods  on  an  as-if  basis,  which  resulted  in  the  removal  of                        
          intersegment  revenue  from  the  Technology  Services  business  unit  within  
          the  Enterprise  Group  segment  and  the  related  corporate  intersegment        
          revenue  eliminations,  and  the  transfer  of  operating  profit  from  the        
          Technology  Services  business  unit  within  the  Enterprise  Group  segment    
          to  the  Infrastructure  Technology  Outsourcing  business  unit  within  the    
          Enterprise  Services  segment.  This  change  had  no  impact  on  HP's                  
          previously  reported  consolidated  net  revenue,  earnings  from  operations,
          net  earnings  or  net  earnings  per  share.                                                                
                                                                                                                                                        
                                                                                                                                                        
                                    HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                    
                                                        SEGMENT  INFORMATION                                                          
                                                                (Unaudited)                                                                  
                                                              (In  millions)                                                                
                                                                                                                                                        
                                                                                                              Six  months  ended          
                                                                                                                      April  30,                
                                                                                                      ------------------------  
                                                                                                              2015                  2014        
                                                                                                      -----------    -----------  
Net  revenue:(a)                                                                                                                          
                                                                                                                                                        
    Personal  Systems                                                                  $        16,284    $        16,706  
    Printing                                                                                            10,996              11,649  
                                                                                                      -----------    -----------  
        Total  Printing  and  Personal  Systems  Group                      27,280              28,355  
    Enterprise  Group                                                                            13,542              13,603  
    Enterprise  Services                                                                        9,810              11,297  
    Software                                                                                              1,763                1,887  
    HP  Financial  Services                                                                    1,608                1,737  
    Corporate  Investments                                                                          18                    294  
                                                                                                      -----------    -----------  
        Total  segments                                                                            54,021              57,173  
    Elimination  of  intersegment  net  revenue  and                                                              
      other                                                                                                (1,729)            (1,710)
                                                                                                      -----------    -----------  
                                                                                                                                                        
        Total  HP  consolidated  net  revenue                            $        52,292    $        55,463  
                                                                                                      ===========    ===========  
                                                                                                                                                        
Earnings  before  taxes:(a)                                                                                                      
                                                                                                                                                        
    Personal  Systems                                                                  $              548    $              569  
    Printing                                                                                              2,063                2,119  
                                                                                                      -----------    -----------  
        Total  Printing  and  Personal  Systems  Group                        2,611                2,688  
    Enterprise  Group                                                                              2,040                1,960  
    Enterprise  Services                                                                            342                    208  
    Software                                                                                                  317                    331  
    HP  Financial  Services                                                                        175                    200  
    Corporate  Investments                                                                      (268)                    23  
                                                                                                      -----------    -----------  
        Total  segment  earnings  from  operations                              5,217                5,410  
                                                                                                                                                        
    Corporate  and  unallocated  costs  and  eliminations                (334)                (372)
    Stock-based  compensation  expense                                                (316)                (300)
    Amortization  of  intangible  assets                                              (443)                (547)
    Restructuring  charges                                                                      (401)                (366)
    Acquisition-related  charges                                                            (23)                    (6)
    Separation  costs                                                                                (349)                      -  
    Interest  and  other,  net                                                                  (313)                (337)
                                                                                                      -----------    -----------  
                                                                                                                                                        
        Total  HP  consolidated  earnings  before  taxes        $          3,038    $          3,482  
                                                                                                      ===========    ===========  
                                                                                                                                                        
(a)    Effective  at  the  beginning  of  its  first  quarter  of  fiscal  2015,  HP          
          implemented  an  organizational  change  to  align  its  segment  financial        
          reporting  more  closely  with  its  current  business  structure.  This              
          organizational  change  resulted  in  the  transfer  of  third  party  multi-      
          vendor  support  arrangements  from  the  Technology  Services  business  unit  
          within  the  Enterprise  Group  segment  to  the  Infrastructure  Technology      
          Outsourcing  business  unit  within  the  Enterprise  Services  segment.  HP      
          reflected  this  change  to  its  segment  information  in  prior  reporting        
          periods  on  an  as-if  basis,  which  resulted  in  the  removal  of                        
          intersegment  revenue  from  the  Technology  Services  business  unit  within  
          the  Enterprise  Group  segment  and  the  related  corporate  intersegment        
          revenue  eliminations,  and  the  transfer  of  operating  profit  from  the        
          Technology  Services  business  unit  within  the  Enterprise  Group  segment    
          to  the  Infrastructure  Technology  Outsourcing  business  unit  within  the    
          Enterprise  Services  segment.  This  change  had  no  impact  on  HP's                  
          previously  reported  consolidated  net  revenue,  earnings  from  operations,
          net  earnings  or  net  earnings  per  share.                                                                
                                                                                                                                                        
                                                                                                                                                        
                                  HEWLETT-PACKARD  COMPANY  AND  SUBSIDIARIES                                      
                                          SEGMENT/BUSINESS  UNIT  INFORMATION                                            
                                                                (Unaudited)                                                                  
                                                              (In  millions)                                                                
                                                                                                                                                        
                                                                    Three  months  ended                        Change  (%)    
                                                -------------------------------------    -----------    
                                                  April  30,      January  31,      April  30,                                
                                                        2015                  2015                  2014            Q/Q        Y/Y    
                                                -----------    -----------    -----------    ----      ----    
Net  revenue:(a)                                                                                                                          
                                                                                                                                                        
    Printing  and  Personal                                                                                                          
      Systems  Group                                                                                                                        
        Personal  Systems                                                                                                                
            Notebooks                  $          4,170    $          4,724    $          3,977      (12%)        5%  
            Desktops                                2,762                2,949                3,343        (6%)    (17%)
            Workstations                            513                    526                    548        (2%)      (6%)
            Other                                          295                    345                    308      (14%)      (4%)
                                                -----------    -----------    -----------                              
                Total  Personal                                                                                                            
                  Systems                            7,740                8,544                8,176        (9%)      (5%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Printing                                                                                                                                
            Supplies                                3,684                3,601                3,866          2%        (5%)
            Commercial                                                                                                                        
              Hardware                              1,304                1,316                1,402        (1%)      (7%)
            Consumer  Hardware                  465                    626                    566      (26%)    (18%)
                                                -----------    -----------    -----------                              
                Total  Printing                5,453                5,543                5,834        (2%)      (7%)
                                                -----------    -----------    -----------                              
                    Total                                                                                                                          
                      Printing  and                                                                                                          
                      Personal                                                                                                                  
                      Systems                                                                                                                    
                      Group                          13,193              14,087              14,010        (6%)      (6%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Enterprise  Group                                                                                                                
            Industry  Standard                                                                                                          
              Servers                                3,138                3,387                2,829        (7%)      11%  
            Technology                                                                                                                        
              Services                              1,932                1,987                2,108        (3%)      (8%)
            Storage                                      740                    837                    808      (12%)      (8%)
            Networking                                556                    562                    658        (1%)    (16%)
            Business  Critical                                                                                                          
              Systems                                    195                    208                    230        (6%)    (15%)
                                                -----------    -----------    -----------                              
                Total                                                                                                                              
                  Enterprise                                                                                                                  
                  Group                                6,561                6,981                6,633        (6%)      (1%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Enterprise  Services                                                                                                          
            Infrastructure                                                                                                                
              Technology                                                                                                                      
              Outsourcing                        2,871                3,132                3,597        (8%)    (20%)
            Application  and                                                                                                              
              Business                                                                                                                          
              Services                              1,946                1,861                2,105          5%        (8%)
                                                -----------    -----------    -----------                              
                Total                                                                                                                              
                  Enterprise                                                                                                                  
                  Services                          4,817                4,993                5,702        (4%)    (16%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Software                                        892                    871                    971          2%        (8%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        HP  Financial                                                                                                                        
          Services                                      805                    803                    867          0%        (7%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Corporate                                                                                                                              
          Investments                                    2                      16                        6      (88%)    (67%)
                                                -----------    -----------    -----------                              
                Total  segments              26,270              27,751              28,189        (5%)      (7%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Elimination  of                                                                                                                    
          intersegment  net                                                                                                              
          revenue  and  other                  (817)                (912)                (880)    (10%)      (7%)
                                                -----------    -----------    -----------                              
                                                                                                                                                        
        Total  HP                                                                                                                                
          consolidated  net                                                                                                              
          revenue                        $        25,453    $        26,839    $        27,309        (5%)      (7%)
                                                ===========    ===========    ===========                              
                                                                                                                                                        
(a)    Effective  at  the  beginning  of  its  first  quarter  of  fiscal  2015,  HP          
          implemented  an  organizational  change  to  align  its  segment  financial        
          reporting  more  closely  with  its  current  business  structure.  This              
          organizational  change  resulted  in  the  transfer  of  third  party  multi-      
          vendor  support  arrangements  from  the  Technology  Services  business  unit  
          within  the  Enterprise  Group  segment  to  the  Infrastructure  Technology      
          Outsourcing  business  unit  within  the  Enterprise  Services  segment.  HP      
          reflected  this  change  to  its  segment  information  in  prior  reporting        
          periods  on  an  as-if  basis,  which  resulted  in  the  removal  of                        
          intersegment  revenue  from  the  Technology  Services  business  unit  within  
          the  Enterprise  Group  segment  and  the  related  corporate  intersegment        
          revenue  eliminations.  This  change  had  no  impact  on  HP's  previously          
          reported  consolidated  net  revenue,  earnings  from  operations,  net              
          earnings  or  net  earnings  per  share.                                                                        
                                                                                                                                                        
 

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