It is no big surprise that HP’s profits are down. In times like these, if you make a profit, you are doing great. So in one aspect, HP, you made a profit, YEAH!
With people trying to save money where they can, it is no surprise to see the sales of personal computers down and their services division up. People are more willing to fix something instead of replace it.
The one surprising aspect is the printer supplies division. It was down 19% (only to the tune of $6 billion). “Cathie Lesjak, HP’s chief financial officer, said the decline in ink sales was a “reflection of a very tough economy — in a tough economy folks don’t print as much,”" this is only partially true. Last year, every printer company raised their prices. However, HP just did another price increase on the first of Febuary around the tune of 7% average. The reasoning behind the first price increase was understandable, the cost of the materials have went up. However, the reason behind the second price increase I believe is a slap in the face for HP’s customers. To paraphase the press release I received, ‘ Since we are not selling a lot, we need to increase prices to make more money off the people who are buying our products.’
The way HP put this press release out about increasing prices, in my mind, was not right. You do not increase the prices on customers just because the economy is bad. Consumers have it bad enough as it is. On the good side, we have seen an increase in interest in our products and services. Thanks HP.
Thanks goes out to the Associated Press for help on this article.
