HP Issues Statement in Response to Market Confusion Around Its 10-Q Filing
Friday, March 14, 2003
PALO ALTO, Calif. --March 13, 2003-- HP today issued the following statement in response to market confusion around its 10-Q filing. "As part of our normal controls process in preparation for our official 10-Q filing, we discovered an accounting classification error," said Bob Wayman, HP chief financial officer. "We obviously regret this error and the confusion caused by a reported cash flow from operations in Q1 of $647 million in our official 10-Q filing versus the $791 million we reported in our preliminary cash flow statement. We are reviewing our procedures for preparing preliminary statements. The important takeaway for investors from both our earnings call and yesterday's 10-Q filing is that our gross cash position of $13.2 billion is strong and unchanged." "Our PC business performance also continues to be the subject of continued confusion," said Wayman. "In our latest Q1, we reported a profit of $33 million in our Personal Systems business -- a sequential improvement of $101 million in operating performance from a loss of $68 million the preceding quarter. On a combined company basis, the PC business lost $52 million a year ago. The improvement year over year was $85 million. By every measure, this represents real profitability and real performance improvement." Finally, in response to continued speculation around revenue loss, the company reported that for the 2002 fourth calendar quarter period, in line with the reporting periods of many of its peers, revenues would have been up 9% sequentially. Wayman added: "One month into the company's second fiscal quarter, revenue for the combined company is up 3% year over year."