HP's sales keep expanding
Profit tops expectations and the company sees continued strong revenue growth. — Demand for laptop computers spurred sales and elevated profit at Hewlett-Packard Co. during the latest quarter. — HP said Monday that sales of notebook computers grew nearly 50% compared to a year earlier.
Context & Ripple Effects
This lands one day after CNET reported how notebooks and servers again lifted HP's earnings, so the LA Times piece confirms rather than breaks the news: Hewlett-Packard closed its fourth quarter with revenue up across every business unit, the PC operation once more the standout.
The detail that matters is composition. Notebook sales grew nearly 50% year over year, and the company attributes part of the strength to purchases from emerging nations — evidence that HP's post-Compaq scale and its recent acquisitions push into consumer and international segments are converting into volume growth, not just cost cuts.
First-order effects
- Dell, Acer, Lenovo and other notebook rivals now compete against a market leader whose laptop volumes are compounding at roughly 50% annually while overall PC demand holds, squeezing share at exactly the moment HP's brand and distribution are strongest.
- HP's own product mix tilts further toward portables, raising the weight of notebook margins and supply commitments in every forward quarter it reports.
Second-order effects
- Suppliers feeding the notebook build — displays, drives, and components — see HP's order book become a larger share of their demand, giving HP added leverage in component pricing negotiations.
- Rivals under price pressure in desktops are pushed to chase the same emerging-market notebook demand HP cites, likely compressing average selling prices across the portable segment.
Third-order effects
- If emerging-nation buyers keep driving the growth line, the center of gravity for the PC industry shifts decisively from mature desktop replacement cycles to first-time portable purchases, rewarding manufacturers with global distribution and punishing those without.
- Sustained results like these validate the consolidation playbook HP has run since Compaq, inviting further acquisitions by HP and imitators among large hardware makers.
The trend: Portable computing is becoming the volume engine of the PC industry, with emerging markets and scaled manufacturers like HP setting the pace.