PALO ALTO, Calif.--Nov. 17, 2005-- HP today reported financial results for its fourth fiscal quarter ended Oct. 31, 2005, showing net revenue increased 7% year-over-year to $22.9 billion. Non-GAAP(1) operating profit was $1.7 billion, with non-GAAP diluted earnings per share (EPS) of $0.51, up from $0.41 in the prior-year period. Non-GAAP financial information for the fourth quarter excludes $1.1 billion of adjustments(1) on an after-tax basis, or $0.37 per diluted share, related primarily to restructuring-related costs and amortization of purchased intangibles, offset by a pension curtailment credit. GAAP operating profit was $232 million and GAAP diluted EPS was $0.14 per share, down from $0.37 in the prior-year period. "HP delivered another strong quarterly performance, with balanced revenue growth, good cost discipline, improved margins in key businesses and strong cash flow," said Mark Hurd, HP chief executive officer and president. "We are pleased with our progress to date, but there is more work ahead of us." During the quarter, on a year-over-year basis, revenue in the Americas grew 5% to $10.0 billion, Europe, the Middle East and Africa grew 8% to $9.1 billion, and Asia Pacific grew 12% to $3.8 billion. On a consolidated basis, when adjusted for the effects of currency, fourth quarter revenue grew 6% year-over-year. Personal Systems Group Personal Systems Group (PSG) revenue grew 9% year-over-year to $7.1 billion, with unit shipments up 13%. On a year-over-year basis, desktop revenue increased 1% and notebook revenue grew 23%. Revenue for commercial clients, which includes workstations, grew 8% over the prior-year period, while revenue in consumer clients grew 14%. PSG reported an operating profit of $200 million, or 2.8% of revenue, up from a profit of $77 million, or 1.2% of revenue, in the prior-year period. Imaging and Printing Group Imaging and Printing Group (IPG) posted quarterly revenue of $6.8 billion, up 4% year-over-year. On a year-over-year basis, consumer hardware revenue decreased 4%, with printer unit shipments up 6%. Commercial hardware revenue grew 4% over the prior-year period, with printer unit shipments up 16%. Color laser unit shipments increased 41% year-over-year, and enterprise multifunction printer shipments increased 83%, reflecting continued momentum in key growth initiatives. Supplies revenue grew 7%. Operating profit was $896 million, or 13.2% of revenue, down from a profit of $1.1 billion, or 16.6% of revenue, in the prior-year period. Enterprise Storage and Servers Enterprise Storage and Servers (ESS) reported revenue of $4.5 billion, up 10% over the prior-year period. On a year-over-year basis, industry-standard server revenue increased 12%, networked storage revenue grew 17% and business-critical systems revenue declined 1%. ESS reported an operating profit of $405 million, or 9.1% of revenue, up from a profit of $100 million, or 2.5% of revenue, in the prior-year period. HP Services HP Services (HPS) revenue grew 6% year-over-year to $3.9 billion. On a year-over-year basis, Managed Services revenue grew 9%, Technology Services grew 4% and Consulting and Integration grew 11%. Operating profit was $322 million, or 8.3% of revenue, down from a profit of $375 million, or 10.2% of revenue, in the prior-year period. Software Software reported quarterly revenue of $311 million, an increase of 11% year-over-year, with revenue in HP OpenView and HP OpenCall increasing 16% and 3%, respectively. Software reported an operating profit of $27 million, or 8.7% of revenue, compared with a loss of $7 million in the prior-year period. Financial Services HP Financial Services (HPFS) reported revenue of $514 million, an increase of 3% year-over-year. Finance volume and net portfolio assets declined 1% and 3% respectively. Operating profit was $52 million, or 10.1% of revenue, up from a profit of $19 million, or 3.8% of revenue, in the prior-year period. Asset management Inventory ended the quarter at $6.9 billion, up $233 million sequentially and down $194 million year-over-year. Accounts receivable increased $1.1 billion sequentially and decreased $323 million over the prior-year period to $9.9 billion. HP's dividend payment of $0.08 per share in the fourth quarter resulted in cash usage of $229 million. In addition, HP utilized $1.4 billion of cash during the fourth quarter to repurchase stock. HP exited the quarter with $13.9 billion in gross cash, which includes cash and cash equivalents of $13.9 billion and short- and certain long-term investments of $36 million. Outlook First quarter FY06 non-GAAP earnings per share is expected to be in the range of $0.46 to $0.48, excluding $0.03 to $0.04 of stock-based compensation expense, or $0.42 to $0.44 including stock-based compensation expense. Full year FY06 non-GAAP earnings per share is expected to be in the range of $1.88 to $1.95, excluding approximately $0.13 of stock-based compensation expense, or $1.75 to $1.82 including stock-based compensation expense. Non-GAAP earnings per share estimates for Q1 FY06 and full year FY06 exclude after-tax costs of approximately $0.04 per share and $0.14 per share respectively, primarily related to the amortization of purchased intangible assets. More information on HP's quarterly earnings, including additional financial analysis and an earnings overview presentation, is available on HP's Investor Relations website at www.hp.com/hpinfo/investor/.