HP suffers record US$8.9bn loss

Hewlett Packard has reported losses of US$8.9bn after accounting for an acquisition which didn't develop how management predicted.

The company's fiscal third-quarter earnings showed a decline in revenues by 5%, falling to $29.7bn year-over-year, with the computer firm earning $2bn for three months ending in July – equating to $1 per share.

The setback has not surprised the industry however, with the company previously disclosing plans to take an $8bn charge to reflect the diminishing value of Electronic Data Systems, the technology consulting service it paid $13bn for in 2008.

"HP is still in the early stages of a multi-year turnaround, and we're making decent progress despite the headwinds," says Meg Whitman, HP president and CEO.

"During the quarter we took important steps to focus on strategic priorities, manage costs, drive needed organisational change, and improve the balance sheet. We continue to deliver on what we say we will do."

After announcing plans to lay off 27,000 of its employees, equating to 8% of its workforce, over the next 18 months, HP says that although software revenue increase to 18%, PC divisions sales a 10% decline as consumers move towards mobile computing.