From: Reuters
Published May 13, 2008 08:25 AM

HP posts higher profit in preliminary report

NEW YORK (Reuters) - Hewlett-Packard Co <HPQ.N> posted better-than-expected quarterly profit on Tuesday in a preliminary earnings report released shortly after it announced plans to buy Electronic Data Systems Corp <EDS.N> for about $12.6 billion.

Net income in the second quarter ended on April 30 was 80 cents a share, up from 65 cents a year earlier, on revenue of $28.3 billion.

Excluding special items, the profit was 87 cents a share, beating Wall Street forecasts of 84 cents, according to Reuters Estimates.

The company attributed the results to solid performance across its business segments and strong cash flow from operations.

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Looking ahead, HP sees third-quarter earnings per share of 82 cents to 83 cents, excluding items, on revenue of $27.3 billion to $27.4 billion. The forecast was on par with analysts' views, according to Reuters Estimates.

HP estimates full-year revenue at $114.2 billion to $114.4 billion, up from its previous outlook of $113.5 billion to $114 billion.

Earnings per share for the fiscal year, excluding items, are expected to be in the range of $3.54 to $3.58, up from its previous estimate of $3.50 to $3.54, the company said.

The estimates for both the third quarter and full year of fiscal 2008 do not reflect potential effects of the EDS acquisition, HP said.

The deal is expected to close in the second half of 2008, the companies said. Their collective services businesses had annual revenues of more than $38 billion and 210,000 employees, doing business in more than 80 countries.

(Reporting by Franklin Paul; Editing by Derek Caney and Lisa Von Ahn)

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