Hewlett-Packard Company (HPQ) F4Q2010 Earnings Call Transcript November 22, 2010 5:00 pm ET Executives Steve Fieler – VP, IR Leo Apotheker – President and CEO Cathie Lesjak – EVP and CFO Ann Livermore – EVP, Enterprise Business Todd Bradley – EVP, Personal Systems Group Vyomesh Joshi – EVP, Imaging and Printing Group Analysts Richard Gardner – Citigroup Benjamin Reitzes – Barclays Capital Keith Bachman – Bank of Montreal Toni Sacconaghi – Sanford Bernstein Scott Craig – Bank of America-Merrill Lynch Katy Huberty – Morgan Stanley Brian Alexander – Raymond James Aaron Rakers – Stifel Nicolaus Maynard Um – UBS Jayson Noland – Robert Baird Brian Marshall – Gleacher & Company Bill Fearnley – Janney Capital Markets Mark Moskowitz – JP Morgan Shannon Cross – Cross Research Group Presentation Operator
This call is being webcast. A replay of the webcast will be available shortly after the call for approximately one year.Some information provided during this call may include forward-looking statements that are based on certain assumptions and are subject to a number of risks and uncertainties and actual future results may vary materially. Please refer to the risks described in HP's SEC reports, including our most recent Form 10-Q. The financial information discussed in connection with this call, including tax-related items, reflects estimates based on information available at this time and could differ materially from the amounts ultimately reported in HP's 2010 Form 10-K. Earnings, operating margins, and similar items at the company level are sometimes expressed on a non-GAAP basis and have been adjusted to exclude certain items, including amortization of purchased intangibles, restructuring charges, and acquisition-related charges. The comparable GAAP financial information and a reconciliation of non-GAAP amounts to GAAP are included in the tables in the slide presentation accompanying today's earnings release, both of which are available on the HP Investor Relations' webpage at www.hp.com. I'll now turn the call over to Leo. Leo Apotheker Welcome to our fourth quarter earnings call and thank you for joining us today. Since the last time we spoke, I have been meeting with our customers and partners as well as thousands of employees around the world. I joked on the day of the announcement that I might set a world record for travel, and I think I might have actually done it. I have been listening, I have been learning and I have been immersing myself in the business, and today I'm even more excited and honored to be HP’s CEO. HP is a company with great momentum incredibly committed and talented people, deep customer relationships and strong core businesses. I'm confident in our future and energized about the opportunity that lies ahead. When I look at our Q4 results, what's clear is that HP is winning in the market and we have an impressive ability to execute. I'm proud of our leadership team and our people for their continued focus during what has been extraordinary time for the company.
We finished our fiscal year with $126 billion in revenues. It's a 10% year-over-year increase or an incremental $11.5 billion of growth. We grew nearly $1 billion per month last year. During the same time, we expanded our non-GAAP operating profit faster than revenue, up 14% year-over-year and our non-GAAP EPS grew even faster at 19% for the full year. It is evidence of our strong operating leverage, our leadership positions, our ability to grow in higher margin categories and our strong balance sheet. We are carrying this momentum into FY'11.We have the ability to drive continued growth and at the same time, I remain committed to driving operational efficiencies into the years ahead. I'm confident in our updated FY'11 outlook, which Cathie will share with you in a moment.Before Cathie provides more financial detail, however, I would like to share some of my initial observations about HP, our potential, and also areas where we need to do things better. Now bear in mind, these are just my initial thoughts. I have been on the job for just about three weeks now and I still have good amount of listening and data gathering to do. I intend to provide a more robust perspective in the next few months. Well, now I will share three observations; one about customers, the second is about our employees, and third about our technology. I have received great feedback from our customers thus far. They are asking for a solution partner who helps address and solve their technology, and business challenges. They want to access to information instantly no matter where they are and they want choice not proprietary logins. The great majority are telling me that they want to do more business with HP. They like our openness, our price performance, our industry-leading technologies, and our focus on manageability and security. Read the rest of this transcript for free on seekingalpha.com