Hewlett-Packard Company: Can It Keep Moving Forward?

Hewlett-Packard (HPQ +0.67%) will release its quarterly report on Thursday, and investors have high hopes that the once-beleaguered tech stalwart will continue to recover from its near-fatal plunge in late 2012. Yet as Hewlett-Packard keeps making progress in its efforts, it's also moving in directions that will challenge not only traditional rivals IBM (IBM 2.21%) and Cisco Systems (CSCO 2.73%) but also Microsoft (MSFT 2.44%) and other companies that it once considered to be close partners.

Hewlett-Packard has a long history of innovation in the technology industry, with hardware products that have advanced technology solutions in many different areas. Even after facing the prospect of obsolescence of its PC-related business, HP has moved ahead with some brand-new initiatives designed to spur growth in previously unexplored directions. Will Hewlett-Packard end up becoming a disruptor in the tech industry along the way? Let's take an early look at what's been happening with Hewlett-Packard over the past quarter and what we're likely to see in its report.

HP Chromebook 11. Source: Google.

Stats on Hewlett-Packard

Source: Yahoo! Finance.

Can Hewlett-Packard earnings keep climbing?
In recent months, analysts have had mixed views on Hewlett-Packard earnings. They've cut their January-quarter estimates by a penny per share, but they've boosted their full-year fiscal 2014 and 2015 projections, with 2015 expected to grow 3.5% faster than previously expected. The stock has also climbed, gaining 13% since mid-November.

Hewlett-Packard certainly started the quarter on the right foot, with its fiscal fourth-quarter results staying on pace with CEO Meg Whitman's five-year turnaround plan. Sales still fell 3% and led adjusted earnings down 13% from the year-ago quarter, but HP boosted its guidance for the full 2014 fiscal year. Considering dour predictions for 8% to 10% lower sales for Cisco, HP's positive expectations looked exceedingly strong by comparison.

Smart strategic moves have helped Hewlett-Packard stock climb as well. By moving away from a long relationship of nearly exclusively using Microsoft operating systems on its products, HP has instead fostered multi-platform development by releasing Android tablets and Chromebooks, and it has encouraged its PC buyers to stick with Windows 7 rather than upgrading to the more mobile-focused Windows 8. In addition, HP recently sold off a substantial amount of its mobile-device intellectual property to Qualcomm, freeing it to focus more on its top growth priorities.

Perhaps most importantly, Hewlett-Packard has continued its major move into the 3-D printing industry, using its extensive reputation in printing technology to go up against much smaller niche players in the market. Yet some believe that HP is making a mistake by focusing on the consumer-service center angle of the market, leaving untapped a huge industrial customer base that could provide far greater revenue in a much shorter timeframe. By contrast, appealing to consumers could be a bigger long-term opportunity, but it'll take much longer to convince ordinary consumers of the benefits of 3-D printing compared to industrial manufacturers that are already moving aggressively to adopt the technology.

In the Hewlett-Packard earnings report, watch closely to see how the company's various segments perform. Most analysts will focus their attention on the enterprise services segment, whose servers and networking equipment most closely competes against IBM, Cisco, and other major players. But HP also has to go beyond those core products and services to find something to distinguish itself from its peers, and now that Whitman has had enough time to get HP's turnaround started, investors should start to expect hints about exactly what the future will look like for the company in the long run.

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