In addition, the company pared down its projected earnings for the year towards the lower end of an earlier estimate. This reflects the slowdown in personal computer sales in the US market along with the sluggish economy in China and Europe.
The company is currently implementing a multi-year restructuring program intended to allow it to focus on enterprise services. This may result to a reduction of its workforce of over 300,000 around the world.
Half of the job reduction on the plan of the company is expected within the year as it expects a reduction of 11,500 jobs by the end of the 2012 fiscal year, according to Cathie Lesjak, the CFO of the company.
According Shaw Wu of Sterne Agee, the predictability of the earnings has shown that the company has made progress in turning the company around. Poor forecasting has affected the company under Leo Apotheker, the former head of the company.
Meg Whitman, the current CEO of HP, indicated that the company has just started its recovery as it may face some challenges in the future which will affect performance. However Whitman was confident that the company will be able to work towards attaining its objectives.
The biggest PC manufacturer has experienced a five percent drop in its net revenue in the third quarter and lost around $10.8 billion mainly due to the write-down of the EDS business. Falling PC sales have resulted to a $4.49 per share net loss for the third fiscal quarter as compared to the $0.93 per share profit in the same period last year.
HP along with Dell (NASDAQ:DELL), its smaller rival, has been trying to defend their share in the PC market from competition from Asia. If the write-down is not put into the equation, the company would have earned $1 per share. Share prices of the company declined by 3.66 percent as it closed at $19.20 on Wednesday.
Although Wall Street is still waiting for the results of the restructuring plan of the company, it was apprehensive on the reduction in revenue. The company is currently 15 percent lower compared to the time when Whitman became the head on the company last September.