Computer giant Hewlett-Packard's revenue has been on the decline for eight-straight quarters and its quarterly reports aren't likely to put its investors at ease any time soon, according to one analyst.
HP's revenue fell 10 percent in its fiscal quarter ending April, said Brian Marshall, technology analyst at ISI Group. Marshall expects HP to report after Wednesday’s closing bell that its revenue had fallen 9 percent in the quarter ending July. He also expects revenue to continue to fall through 2015.
Part of the problem is simply the company's size, which can make it difficult to deliver consistent revenue growth, Marshall said.
"HP obviously is one of the rare companies that generates over $100 billion of annual sales. At that stratosphere, if you will, there's not a lot of oxygen in the air," Marshall told Big Data Download.
But despite a dramatic decline in PC sales overall, HP's stock has been flying high. That's partly because the company has been beating Wall Street's earnings estimates, which have likely been very conservative in the first place, Marshall said.
"Expectations were set really low. The management basically kitchen-sinked the earnings guidance and so over the past couple quarters, HP's had a lot of levers to pull and basically pull down costs, pull down ... operating expenses and been able to beat consensus earnings expectations,” Marshall said. “That's pretty much been the main driver of the stock."
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