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Hewlett-Packard Company Message Board

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  • DowDanny DowDanny Mar 7, 1998 11:29 AM Flag

    Answers??? Anyone???

    >> In fact, all of the cheap PCs actually mean that HP will sell a lot more printers, scanners, copiers, etc. <<

    In fact, despite HP being the #3 PC seller, it EARNS more from its printer business (in particular cartridges) than any other product. So if you are concerned for the business and profitability of Hewlett-Packard, keep an eye on Xerox and Lexmark as they try to increase sales of HP clone printer cartridges and cheaper version printers.

    If you are interested just in next weeks stock price movement, rather than the stability and growth of HP business, then anything is possible - could get hurt by PC bad news, even if it ain't too relevant to the company's bottom line.

    HP is an interesting company in that it never breaks out its earnings among its various divisions in its qrtly and annual
    reports (it does do geographic breakdown)... OK - it does say "computing and services" which includes PCs, printers, software,
    servers, etc.. etc... not very helpful to judge which are doing well and which are not. But reading WSJ it is clear that HP can make
    slim profits on low-end PCs, because they will sell them with printers (and scanners) which provide the steady profits on repeat

    But don't listen to me, I still don't know enough to consider HP as a PC company. When I got my first shares HP hadn't shipped its first PC, but I used their calculators and 'instruments' everyday in the lab. Nowadays, I can walk down the hall at work and see a halfdozen HP network printers keeping busy, and right now there's an "old" Laserjet 5L two feet away from my (IBM, oops) PC at home. Watch the printer business if you're worried about long-term future.

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    • DowDanny

      You make a number of points which I agree with. I think the focus
      on "hardware" is only one indicator. Personally, I am watching the E-commerce efforts made by H-P. I think this is the thread that ties the hardware end of the consumer business to a growth
      opportunity. Building the better mousetrap is only part of the
      picture. Getting it the end users, easily, cost effectively and
      quickly is the key. It will be interesting to watch how H-P

      P.S Time to trade that 5L in on a 722C?

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