Sales slowdown is spreading, warns HP

Hewlett Packard (HP) warned yesterday [Wednesday] that its sales slowdown had gone global, suggesting that the technology sector is still far from a recovery.

The firm said that May sales in both consumer and enterprise markets in all regions were soft. It also said it was more cautious about predicting revenues, after previously saying it expected revenues to be flat or fall up to 5 per cent for the three months to the end of July.

HP, which earlier this week agreed to pay office equipment maker Pitney Bowes $400m to settle a patent dispute, said it would make "additional expense reductions" to get closer to analysts' expectations.

Carly Fiorina, chief executive at HP, commented: "While it is still early in the quarter, May was softer than expected and we are now addressing what is clearly becoming a global slowdown. We are taking additional steps to generate revenues and reduce costs."

Fiorina told a news conference that sales were still slow in the US and Europe, and that the process had spread to China, and from Mexico to the rest of Latin America.

The remarks come less than three weeks after the last warning issued by HP.

Compaq, Sun and Palm have all also recently said that international sales have slumped.