HP's CEO Leo Apotheker is trying to re-engage with employees in the workforce that became disillusioned under the leadership of his predecessor Mark Hurd by committing to raise salaries in the current financial year.
The world's largest IT firm last night rolled out fiscal fourth quarter numbers with sales up 8% to $33.3bn and profits up 5% to $2.5bn. For the year, revenues and income rose 10% and 14% respectively to $126bn and $8.8bn.
This is the first quarterly conference call that Apotheker has sat on since his appointment last month and he vowed to reintroduce annual pay increases put on ice by the previous regime.
"I believe in the performance-driven culture and our employees have been performing. Therefore, I am pleased that we will be reinstating salary increases in FY'11 as part of our normal review process. It is well deserved," said Apotheker.
He also revealed that HP was getting back to its roots and had already spent more on R&D in Q4, another area in which investment was reduced by Hurd.
"In the fourth quarter, R&D was up more than revenues growth both year-over-year and sequentially, we should expect this trend to continue," he added.
HP's Services division grew fiscal Q4 revenues by just 0.4% to $9bn, with a 1% rise in Technology Outsourcing, Application and Technology Services dampened by an 11% drop in Business Process Outsourcing.
Sales growth in the Software business unit was also less than dramatic, up only 1% to $974m including a 4% rise in Business Technology Optimisation and a 6% decline in Other Software revenues.
Enterprise Storage and Servers sales grew 25% to $5.3bn, with ISS up 32%, storage up 14% and Business Critical Servers growing 10% and Networking revenues grew 227% via acquisition but 50% organically.
The Imaging and Printing Unit expanded 8% to $7bn and the Personal Systems Group grew 4% to $10.3bn, with commercial client revenues up 20% and down 10% in the faltering consumer sector.