Shares of HP jumped 10 percent as its preliminary October quarter results suggested the world's largest-maker of personal computers was winning market share and benefiting from recurring revenue streams from services and printing supplies.
HP has lost about a third of its market value in the last two months on fears of a sharp slowdown in PC spending, which had increased after chip giant Intel Corp shocked markets with a revenue warning last week and electronics retailer Best Buy slashed its outlook.
"HP is gaining market share in an extremely strong competitive position. They've got share gains, combined with very aggressive cost reduction," said Shannon Cross of Cross Research.
"It's very prudent management of their resources, and that's allowed them to put out numbers that are ahead of the Street even in this economic environment," she said.
HP's preliminary net profit in the fiscal fourth quarter that ended October 31, was 84 cents per share, or $1.03 excluding items such as restructuring and acquisition charges.
Analysts were looking for earnings per share of $1.00, excluding items, according to Reuters Estimates.
Fourth-quarter revenue rose 19 percent to $33.6 billion, or an increase of 16 percent when adjusted for currency effects, compared with the average analyst estimate of $33.1 billion.
The company forecast fiscal 2009 earnings excluding items of $3.88 to $4.03 per share, which beat the average Wall Street estimate of $3.86, according to Reuters Estimates
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