David A. Grogan | CNBC
Meg Whitman, Chairman and CEO of Hewlett-Packard at the 2016 World Economic Forum in Davos, Switzerland.
Shares of Hewlett Packard Enterprise tanked about 9 percent on Friday morning after the company reported lower-than-expected quarterly revenue and slashed its outlook for the year.
The company reduced its outlook for the year by 12 cents per share, citing investments to overcome challenges during the rest of the year, including pressure from foreign exchange rates, higher commodities pricing, and some “near-term execution issues.”
Hewlett Packard Enterprise, which sells commercial computer systems, software and tech services, is half of the company formerly known as Hewlett-Packard. The other half, HP, sells personal computers and printers. The split, as well as a spinoff of some software assets, has meant a lot of changes for workers at Hewlett Packard Enterprise, Whitman said.
“The good news is, when the dust settles, this makes us a much stronger company,” Whitman said. “So it was absolutely the right thing to do.”
Revenue was down 10 percent from the year-ago period, amid downticks in the company’s software and enterprise services. Enterprise networking was a particularly sore spot for the company, with sales down 33 percent in the quarter.
“There were a couple of headwinds,” Whitman said. “The market’s a little bit soft, for sure, but secondarily, foreign exchange and commodity prices, and specifically memory.”
