On May 16, PC hardware and software maker Hewlett-Packard (NYSE:HPQ) released second-quarter earnings for the period ended April 30.

  • Revenues increased by 13%, driven primarily by a 24% increase in the Personal Systems Group and a 58% rise in HP Software revenues.

  • Management estimates that Q3 revenue will be approximately $23.7 billion-$23.9 billion, and that total 2007 revenues will be in the range of $100.5 billion-$100.9 billion. EPS, meanwhile, is expected in the range of $0.60 to $0.61 for the quarter, and $2.51 to $2.53 for the full year.

  • In Motley Fool CAPS, the stock carries a middling three-star rating.

(Figures in millions, except per-share data)

Income Statement Highlights

Q2 2007

Q2 2006

Change

Sales

$25,534.0

$22,554.0

13.2%

Net Profit

$1,775.0

$1,899.0

(6.5%)

EPS

$0.65

$0.66

(1.5%)

Diluted Shares

2,731.0

2,887.0

(5.4%)

Get back to basics with a look at the income statement.

Margin Checkup

Q2 2007

Q2 2006

Change*

Gross Margin

24.5%

24.8%

(0.3)

Operating Margin

8.3%

7.4%

1.0

Net Margin

7.0%

8.4%

(1.5)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q2 2007

Q2 2006

Change

Cash + ST Invest.

$12,310.0

$14,044.0

(12.3%)

Accounts Rec.*

$14,109.0

$12,323.0

14.5%

Inventory

$7,278.0

$6,768.0

7.5%

Liabilities

Q2 2007

Q2 2006

Change

Accounts Payable

$11,505.0

$10,077.0

14.2%

Long-Term Debt

$3,977.0

$2,406.0

65.3%

*Accounts receivable includes financing receivables.

Learn the ways of the balance sheet.

Cash Flow Highlights

YTD 2007

YTD 2006

Change

Cash From Ops.

$4,139.0

$5,480.0

(24.5%)

Capital Expenditures

$1,476.0

$948.0

55.7%

Free Cash Flow

$2,663.0

$4,532.0

(41.2%)

Free cash flow is a Fool's best friend

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.