HP 2009 Annual Report Download - page 57

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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Management’s Discussion and Analysis of
Financial Condition and Results of Operations (Continued)
Net Revenue
The components of the weighted net revenue change from the prior-year period were as follows
for the following fiscal years ended October 31:
2009 2008
Percentage Points
Personal Systems Group ............................................ (5.9) 5.6
Imaging and Printing Group ......................................... (4.7) 1.0
Enterprise Storage and Servers ....................................... (3.4) 0.7
HP Software .................................................... (0.6) 0.6
Corporate Investments/Other ........................................ (0.2) (0.2)
HP Financial Services .............................................. — 0.4
Services ........................................................ 11.6 5.4
Total HP ....................................................... (3.2) 13.5
Fiscal 2009
In fiscal 2009, the global slowdown of IT and consumer spending impacted each of our segments.
Net revenue decreased 3.2% in fiscal 2009 from fiscal 2008 (increased 1.3% on a constant currency
basis). The unfavorable currency impact for fiscal 2009 was due primarily to the movement of the
dollar against the euro. For fiscal 2009, the Services segment contributed favorably to the total HP net
revenue change primarily as a result of the EDS acquisition. U.S. net revenue increased 12% to
$41.3 billion for fiscal 2009 as compared to fiscal 2008, while net revenue from outside of the United
States decreased 10% to $73.2 billion. The increase in U.S. net revenue in fiscal 2009 from fiscal 2008
was primarily a result of the acquisition of EDS.
The PSG net revenue decline in fiscal 2009 from fiscal 2008 was primarily the result of the overall
slowdown in the global economy. PSG average selling prices (‘‘ASPs’’) declined in both consumer
clients and commercial clients. The ASP decline in fiscal 2009 was offset slightly by an increase in the
option and monitor attach rates. PSG unit volumes, however, increased slightly in fiscal 2009 as
compared to fiscal 2008.
IPG experienced net revenue declines in fiscal 2009 from fiscal 2008 in the commercial and
consumer hardware business units and in the supplies business unit. Unit volume declines across each
of the business units were a result of the softness in both the business and consumer demand
environments.
ESS net revenue decreased in fiscal 2009 from fiscal 2008 driven by declines in our industry
standard servers (‘‘ISS’’), business critical systems and storage business units. The revenue declines were
due primarily to the economic slowdown and overall weak demand environment. ISS unit volumes and
average unit prices declined in fiscal 2009 as compared to the prior year.
HP Software experienced net revenue declines in fiscal 2009 from fiscal 2008 in both the business
technology optimization (‘‘BTO’’) business unit and the other software business unit due primarily to
revenue declines in licenses and services, the effect of which was partially offset by increased support
revenue as a result of renewal rate increases.
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