Big revenue drop for HP NZ
The New Zealand arm of United States computer powerhouse Hewlett Packard has reported its third successive double-digit revenue drop.
However, IDC Research analyst Adam Dodds said the rot might soon stop.
Revenues fell 14 per cent to $555 million in the year to October after a 12 per cent decline the previous year and a 10 per cent drop the year before that, accounts filed with the Companies Office show.
The subsidiary posted a $14.7m loss after a record $92.5m loss last year.
Dodds said HP retained a strong market share in the desktop and laptop markets, and he understood it had picked up some information technology services work as it recast itself to take advantage of cloud computing.
"How much further backwards will they go? I think they will be flattening now," he said.
HP New Zealand looked set to become the dominant player in the domestic industry after its US parent's 2009 acquisition of American IT services firm EDS, which had enjoyed an especially strong position in the government and corporate market in New Zealand. Instead, an eerie silence fell over the subsidiary.
Country manager Keith Watson has refused to disclose local staff numbers, but the subsidiary's wage bill dropped 10 per cent to $126m last year, suggesting it may have shed as many as half its post-acquisition work force of about 2900.
The subsidiary appeared to hit a low point in 2011 when it announced it would invest $60m in a new data centre in Tuakau, Waikato, only to backtrack that year after it was left off a government IT infrastructure supply panel.
HP is valued at about US$56 billion on the New York Stock Exchange.
Its shares have increased in value by 30 per cent over the past year.