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HP (HPQ) earnings Q1 2020



HP shares moved as much as 6% higher in extended trading on Monday after the company reported better-than-expected fiscal first-quarter earnings and earnings guidance for the 2022 fiscal year. The company also announced an expansion of its share buyback authorization.

Here’s how the company did:

  • Earnings: 65 cents per share, adjusted, vs. 54 cents per share as expected by analysts polled by Refinitiv.
  • Revenue: $14.62 billion, vs. $14.59 billion as expected by analysts polled by Refinitiv.

HP’s revenue declined 0.6% on an annualized basis in the quarter, which ended on January 31, according to a statement.

The new strategic and financial value creation plan comes as HP faces Xerox’s repeated efforts to buy the company. The most recent proposal from Xerox “meaningfully undervalues HP, creates significant risk, and compromises HP’s future,” HP said in a statement. HP said it’s “reaching out to Xerox to explore if there is a combination that creates value for HP shareholders that is additive to HP’s strategic and financial plan.” Shares of Xerox were up 1% after hours.

The repurchasing move is not a surprise. HP had said earlier that on Monday it would provide new details on driving shareholder value, including drawing on its balance sheet. The board has now authorized $15 billion for share repurchases, up from the $5 billion authorization announced in October. In total, HP is now aiming to return about $16 billion to shareholders between fiscal years 2020 and 2022.

For the fiscal first quarter, HP’s revenue from Personal Systems, the segment including PCs, totaled $9.89 billion, up 2% and falling short of the $10.52 billion estimate among analysts surveyed by FactSet.

Printing segment revenue came out to $4.72 billion, down 7% and lower than the $4.85 billion FactSet consensus estimate.

With respect to guidance, HP said it expects 49 cents to 53 cents in earnings per share in the fiscal second quarter, excluding certain items. The middle of range, at 51 cents, is less than the 54 cents per share that analysts polled by Refinitiv had expected.

For the full 2020 fiscal year HP called for $2.33 to $2.43 in earnings per share, excluding certain items. The middle of the range, at $2.38, tops the $2.25 Refinitiv consensus estimate.

HP also issued earnings guidance for the 2022 fiscal year. It’s calling for $3.25 to $3.65 per share, excluding certain items. The middle of that range, $3.45, is well above the $2.35 Refinitiv consensus.

HP announced new long-term target operating margins of 3.5% to 5.5% for its Personal Systems unit and 16% to 18% in the Printing segment.

Xerox’s efforts to acquire HP, which is worth more than four times Xerox, have been public since November. HP sees Xerox, which makes printers and scanners, as a competitor in the printing part of its business. On a conference call on Monday, though, HP CEO Enrique Lores said “there is no overlap between Xerox and over 90% of HP’s business.”

On Thursday HP said its board had adopted a shareholder rights plan that “should encourage Xerox (or anyone else seeking to acquire the Company) to negotiate with the Board prior to attempting to impose some combination that is not in the best interests of the HP shareholders.”

Activist investor Carl Icahn, who has positions in both HP and Xerox, criticized HP’s board in December for turning down Xerox’s offer to buy the company for $22 per share.

“Over the years, I have seen many obvious ‘no-brainers’ that would greatly enhance value and have worked hard to facilitate these, but I can say without exaggeration that the combination of HP and Xerox is one of the most obvious no-brainers I have ever encountered in my career – one where activism should not even be necessary at all because the merits of the combination are so obvious to everybody involved,” he wrote in a letter to HP shareholders.

In January Xerox said it would nominate 11 people to replace HP’s board. And on February 10 Xerox raised its offer to $24 per share, or about $34 billion.

“We believe that consolidation in the space is much needed, but remain skeptical of the financial position of a combined HPQ/Xerox, as it will significantly leverage the firm, while also offering limiting growth opportunities,” CFRA Research analyst Angelo Zino, who has a buy rating on HP stock, wrote in a note distributed to clients on the day Xerox boosted the offer.

Lores addressed the coronavirus on Monday’s call.

“We are actively working to return to full production as quickly as possible,” he said. “We are working with our logistics providers to ensure we get the necessary capacity to meet customer demand. Overall, we are viewing the situation as temporary in nature, and we are aggressively navigating the challenges.” The company expects to see an impact from coronavirus in fiscal second-quarter results, Lores said.

The coronavirus impact could delay effects from companies upgrading to PCs running Microsoft’s Windows 10 operating system, which could lead to better results in the second half of the 2020 fiscal year, finance chief Steve Fieler said on Monday’s call.

Shares of HP were up 8% since the start of the year before Monday’s after-hours rally.

WATCH: HP adopts ‘poison pill’ to fend off Xerox’s takeover attempt

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Acting US navy head resigns over carrier controversy



The acting head of the US navy has resigned over his controversial handling of the firing of the aircraft carrier captain who had asked for help dealing with a coronavirus outbreak on the ship.

US defence secretary Mark Esper said on Tuesday he had accepted the resignation of Thomas Modly, who has been the navy’s acting civilian head since November. Mr Modly “resigned on his own accord,” Mr Esper said in a statement. 

The acting secretary — the top civilian leadership position in the navy — had come under intense criticism for saying that Captain Brett Crozier had been “too naive or too stupid” to command the USS Theodore Roosevelt in remarks during a visit to the carrier, which is docked in Guam as the navy grapples with dozens of coronavirus cases on the ship.

Capt Crozier was dismissed last week after urging the navy in a dramatic letter that became public to do more to protect the several thousand sailors on the ship. “We are not at war. Sailors do not need to die,” he wrote.

After he dismissed Capt Crozier, Mr Modly said he should not have sent the letter to so many people, accusing him of going against the chain of command and increasing the likelihood that the document would go public and signal to adversaries that the carrier had a problem.

When Capt Crozier disembarked last week, however, he received a rapturous send-off from the crew, which cast a harsh spotlight on Mr Modly. The acting navy head created more problems for himself by travelling to Guam and castigating the departed captain in front of the crew in profanity-laced attack.

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Nancy Pelosi, the Democratic speaker of the House of Representatives, said Mr Modly had shown “a serious lack of the sound judgment and strong leadership”.

Jack Reed, the top Democrat on the Senate armed services committee, said he had “mishandled the situation” by removing Capt Crozier “against the advice of senior navy uniformed leadership”, and that his disparaging comments about the former commander were “troubling”.

President Donald Trump had also threatened to weigh in on the issue, saying that Mr Modly and Capt Crozier were “two good people,” while at the same time remarking that the captain should not have sent the letter.

The incident is just the latest problem to beset the US navy, which has seen its reputation badly tarnished in recent years over everything from collisions at sea to a series of personnel scandals that have involved top officials and senior uniformed naval officers.

Mr Esper in November fired Richard Spencer, the previous navy secretary, for trying to negotiate a deal with the White House after Mr Trump intervened in a military justice case involving a Navy seal who was convicted of war crimes and accused — and later acquitted — of murdering a wounded Afghan detainee.

The navy has also been roiled by the “Fat Leonard” case, in which a number of navy officers have been fired or demoted over a scandal that involved a contractor bribing officers in Singapore with lavish entertainment and prostitutes.

Joe Biden, the former vice-president and presumptive Democratic presidential nominee, said the resignation was appropriate. “Our sailors, our nation, and Captain Crozier deserve better,” Mr Biden said.

Guy Snodgrass, a retired Navy officer who previously served with Capt Crozier, said the situation was a “crisis of leadership” that the navy had not seen “in decades”.

He said it was also showed “what happens when you’re wrapped too tightly in your own bubble and you lose sight of the men and women you’re responsible for.”

Mr Snodgrass said it was extraordinary that Mr Modly flew to Guam to deliver a tirade, saying it risked leaving junior officers unclear whether to alert leaders to issues that might save lives or stay quiet to avoid being fired. 

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As work from home becomes the norm, companies get more comfortable hiring fully remote employees



Working from home for the past few weeks? You might have a serious case of cabin fever by now. Or then again, you may have found you prefer it to your former routine. If you’d rather not go back to the office even after the pandemic is finally over, this might be the moment to start looking for a new job that allows—or requires—you to stay home.

Remote job openings were proliferating well before this crisis, rising 270% since 2017, according to new research by job search engine Adzuna that analyzed 4.5 million U.S. postings. Now, spurred on by COVID-19, it seems even more employers want the chance to recruit from a vast talent pool unrestricted by geographic distance.

“Our data shows a continued increase in work-from-home vacancies,” notes Adzuna cofounder Andrew Hunter. Companies that never recruited many (or any) virtual employees before are “embarking on a giant work-from-home experiment,” he adds. “The standard office-based job is increasingly a thing of the past.”

One place to start looking for remote work: Job site FlexJobs has come up with a list of the 35 U.S. employers who are doing the most work-from-home recruiting right now, along with brief descriptions of what kinds of roles they need to fill. For instance, Aetna (#2 on the ranking behind Adobe) is looking for social workers, a lead data scientist, and registered nurses to work as case managers. Dell (#6) is seeking cybersecurity pros and an infrastructure automation engineer.

While both Adzuna and FlexJobs data suggest many current openings call for tech or health care skills, employers are also hiring remote employees in sales, accounting, customer service, human resources, and other fields, some of them highly specialized. UnitedHealth Group, for example, is seeking an expert in dealing with the medical bureaucracy at the Veterans Administration.

Planning to apply? Beyond having the skills and experience in the job description, employers want to see evidence that you’re flexible enough to work alone. So rewrite your resume and cover letter to emphasize, for instance, projects where you collaborated with distant teammates, maybe across different time zones. Since working at home means you’ll have limited access to the company IT help desk, it’s smart to include a list of the collaboration software and web and video conferencing tools you know how to use.

A tip from FlexJobs: Interviewers for remote jobs usually ask the same questions as for other roles, but get ready for a few twists. The virtual-work equivalent of the old stand-by “What’s your greatest weakness?”, for example, is “Why do you want to work remotely?”

This query can be such a minefield for the unprepared that FlexJobs’ report recommends bringing it up yourself even if the interviewer doesn’t ask. Maybe you’ve found that you’re much more productive working at home than in your old noisy open-plan office, or maybe you live in an area where opportunities in your field are scarce (or require a long commute). If you’re enthusiastic about the chance to work for this particular company, remotely or not, don’t forget to say so.

If you can draw a specific example or two from your current remote work, demonstrating how you’ve been able to achieve results from home that equal or exceed what you could have accomplished in the office, so much better. The point is to reassure the interviewer that, even if your only work-at-home experience so far has been dictated by COVID-19, you’re a safe bet as a stellar remote employee in the future.

More must-read careers coverage from Fortune:

—3 ways to manage conflict when you work remotely
—How to job hunt during the coronavirus pandemic
—Everything you need to know about furloughs—and what they mean for workers
—4 things to say if recruiters call you during the coronavirus pandemic
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
—WATCH: 401(k) withdrawal penalties waived for anyone hurt by COVID-19

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Google G Suite passes 6 million customers



Google CEO Sundar Pichai speaks during a conference in Brussels on January 20, 2020.

Kenzo Tribouillard | AFP | Getty Images

Google’s G Suite bundle of productivity software for businesses, schools and governments had over 6 million paying businesses in March, up from 5 million in February 2019, executive Javier Soltero told CNBC on Tuesday.

The growth comes in an increasingly important area for Google parent Alphabet, which disclosed cloud revenue, including from G Suite, for the first time in February. Expansion in the category could help Alphabet grow outside its core area of advertising, which made up 83% of Alphabet’s revenue last year.

However, G Suite in particular faces stiff competition from Microsoft’s entrenched Office suite and Office 365 set of cloud-based services, which had 87.5% of the market for productivity suites in 2018 versus Google’s 10.4%, according to estimates shared by industry-research company Gartner.

“The business of G Suite is growing at an incredibly healthy and, frankly for me, surprising rate,” Javier Soltero, vice president and general manager of G Suite at Google, told CNBC in an interview on Tuesday. Soltero joined Google in October after working at Microsoft, where he had been corporate vice president for the Office product group, among other roles.

Millions of people have been working from home to reduce the spread of coronavirus. That has boosted adoption of the Google Meet productivity-oriented video-calling service, one component of G Suite alongside Gmail, Google Drive and other services. The service has 25 times more users than it did in January, Soltero said. Google Meet is separate from the consumer-focused Hangouts, which is available to anyone with a Google account.

Last month, as cases of COVID-19 were ramping up, Google extended features of Meets — including space for up to 250 participants on any given call and live streaming for up to 100,000 viewers on a domain — that are normally reserved for customers of the G Suite enterprise tier of service to all of its G Suite customers until July 1. Now that’s been extended until September 30. 

Services that compete with Meet, like Cisco’s Webex, Zoom and Microsoft’s Teams, have also taken on new users in the past few months.

Alphabet had $2.61 billion in cloud revenue in the fourth quarter, up 53% on an annualized basis, representing 5.7% of total revenue. The total includes contributions from Google Cloud Platform, the cloud infrastructure for running third-party applications that competes with Microsoft’s Azure and Amazon Web Services. “The growth rate of GCP was meaningfully higher than that of cloud overall,” Alphabet finance chief Ruth Porat told analysts in February, noting that G Suite growth comes from increase in the number of seats and the amount of revenue the company pulls in from each seat.

Google made Meet and Google Classroom available to 1.3 million New York City students in just days as the city’s education department sought to stop the use of Zoom, Soltero said. And within days, he said, the company delivered access to millions of students in Italy following a request from that country’s ministry of education. After working in enterprise software for 25 years, Soltero was surprised how quickly Google was able to roll out its services to so many people. 

“We are guided by building products that people choose. That’s a core principle. That’s been what I’ve admired about G Suite from the beginning,” he said.

WATCH: NYC education department tells principals to stop using Zoom, citing privacy concerns

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