Though it's still too early to call it a success, Hewlett-Packard's
Earnings hit $0.13 a share, compared with a $0.17 loss on a combined company basis in last year's fiscal fourth quarter. Total revenue fell 1%, but was up 9% sequentially.
The big news thus far from the merger is the cost savings. CEO Carly Fiorina pointed to $651 million in permanent cost reductions in the past six months, 30% above targets. HP had cut 12,500 jobs as of the end of the quarter, also ahead of its goal of 10,000.
These results, combined with an affirmation of first-quarter earnings projections, are giving some hope to the PC sector. HP was up 15% in morning trading, the Goldman Sachs Hardware Index rose 6%, and the Philadelphia Semiconductor Index gained 7%.
Chief Financial Officer Bob Wayman did offer some words of caution about the holiday season, however, telling Reuters, "It's still not clear how strong the consumer market will be this year."
Still, the fourth-quarter results must be particularly pleasing to the CEO, who fought a bitter battle to get the acquisition some called "Fiorina's Folly" approved. "We are proud of our progress," she said. "We delivered solid results in a tough market. The HP team is executing, customers are responding and we're beginning to deliver on the promise of the merger. We feel good about our trajectory."
Fiorina has a right to be proud. Thus far, she receives high marks for her vision and execution.