Hewlett-Packard Phils eyes 10% growth in sales, revenues

Hewlett-Packard Philippines expects a 10-percent growth in sales and revenues next year compared to this year, although officials said this would not be enough considering increasing costs.

In an interview, HP Philippines president Raymund del Val said that the International Data Corp. (IDC) projects a five-percent growth rate for the information technology sector in the country next year as against 2001. This year, the sector grew 15 percent compared to the previous year.

"In our case, we expect our growth to be in the low 10s range. But considering overhead and the cost of money, we have to grow much more than this. And we can do that by eating into the market share of competition," Del Val told The STAR.

Already, HP International is preparing for the challenges facing the IT industry. For instance, HP is just awaiting approval from the US Securities and Exchange Commission regarding the proposed purchase of Compaq, another leading name in the computer industry.

According to Del Val, customers need an alternative to IBM. "HP and Compaq combined will offer an alternative to IBM whose approach is proprietary. Ours is on multi-OS (operating system) environment," he said.

Another benefit that the proposed purchase of Compaq will create, he pointed out, is that HP-Compaq will now be bigger in size and, therefore, a more difficult force to reckon with. "If we combine the value of the two companies, that’s $87 billion," Del Val noted. HP had total revenues from continuing operations of $48.8 billion in its 2000 fiscal year.

He stressed: "We need that bigness. When you are big, you can weather the storm. Those that will have difficulty next year or in the near future will be those that are small, or those offering single products. Just look at Sun’s Unix. How can it possibly compete with Windows NT."

HP International also reduced its fiscal year in October, and had just entered the first quarter of the new fiscal year. While Del Val would not talk about numbers because of the mandatory silence period prior to public disclosure of the results of the just finished fiscal year, nevertheless, he described last FY as ‘challenging but bright.’

Worldwide and in the Philippines, Hewlett-Packard remains the leader in the inkjet printer and laser jet printer technology. Here, HP also sells personal computers (Pavilion), but because competitors would cut their prices just to win in online biddings for instance, Del Val said they would rather focus on strategic sales as well as small business and corporate. "For the PCs, if you only sell a few, you won’t make money. You have to sell thousands and thousands to earn," he said.

Also to the weather the storm, Del Val said HP will continue to defend its market share and protect its leadership by introducing new product lines.