The US computer company Hewlett Packard Enterprise (HPE) posted better than expected results in the third quarter of its staggered fiscal year. However, they were down sharply, mainly due to the sale of its software division.
Net profit fell to $165 million from $2.3 billion in the third quarter of 2016. Revenues dropped to $8.2 billion from $12.2 billion of dollars (-33%). Analysts were forecasting $7.5 billion.
“Continuing operations” sales were up 3%, HPE said, comparing this year’s $8.2 billion to $8 billion in the same period last year. HPE sold its software division to the British group Micro Focus, a sale announced last year and finalized on Friday.
Adjusted earnings per share came in at 31 cents, above expectations of analysts who expected an average of 26 cents. This figure is also higher than expected by HPE, which expected a figure between 24 and 28 cents.
The group points in particular to “separation costs” and “restructuring costs” to explain the decline in its net profit. “The results of the third quarter are an encouraging sign of the progress we are making,” said Managing Director Meg Whitman, quoted in the statement. “We still have work, but we are on the right track,” she added.
By line of business, the one dedicated to financial services increased its revenues by 10.5% to 897 million dollars; the software business declined 2.7% to $ 718 million; and Enterprise Group, a segment that integrates its business lines of infrastructure, technology services and large accounts, gained 2.7% more, to $6.791 million.
For the full year, the group revised downwards its forecasts to account for the sale of software. HPE now expects adjusted earnings per share of $1.36 and $1.40, compared to a profit of $1.46 to $1.56 previously expected.
HPE is the result of the split last year of the giant Hewlett Packard, which it had retained the activities of services or for the companies. The group’s historical activities in PCs and printers now depend on another company, HP Inc.