HP hit by slump in sales
Hewlett-Packard (HP) on Wednesday said its quarter profit was hit by a slump in sales of personal computers, while maintaining that its reorganization is making progress. The troubled, but biggest maker of personal computers said net profit in the second fiscal quarter fell 32 percent from a year ago to US$1.1 billion. The earnings amounted to US$0.87 a share after adjustments, sparking a rally of about 12 percent in HP stock in after-hours trade. HP said it had quarterly revenues of US$27.6 billion, down 10 percent from the prior year. The California company has been in focus amid a severe slump in PC sales globally, and said its own PC sales in the quarter fell 21 percent from a year earlier.
US to oversee firm’s takeover
Japan’s SoftBank is preparing to hand the US government an unusual degree of influence over operation of Sprint Nextel, after security concerns raised by the proposed cross-border takeover, the Wall Street Journal reported online. “Tokyo-based SoftBank has agreed to give the [US] federal government the right to approve one of the directors it names to Sprint’s board,” it reported. The director would be responsible for overseeing national security issues, the report added. “People familiar with the matter said the government is also seeking the right to approve some of Sprint’s equipment purchases and wants the removal of Chinese gear from a Sprint affiliate’s network.” The Japanese mobile operator on Tuesday said it planned to raise US$3.9 billion through a record bond issuance next month to finance its proposed takeover of US firm Sprint Nextel.
Ford to axe Australian plants
Ford yesterday announced it would stop making vehicles at its unprofitable Australian plants in 2016 and axe 1,200 jobs, ending an era that began in 1925 with the legendary Model T Ford. Australia chief executive Bob Graziano made the announcement as he revealed losses of A$141 million (US$136 million) after tax in the last financial year and A$600 million over the last five years. Graziano said the decision was the result of local manufacturing being “driven by increasingly challenging market conditions — including market fragmentation and the high cost of manufacturing.” Australia has annual sales of about 1.1 million new vehicles, and customers have access to some 65 brands and 365 models, with Holden, a General Motors subsidiary and Toyota the other key manufacturers. Graziano said this made Australia one of the most competitive and crowded automotive markets in the world, and a strong currency was making it harder for domestic carmakers to compete with cheap imports.
Trade secret theft costly: US
Theft of trade secrets, mainly by China, costs the US economy US$300 billion a year and must be fought with sanctions as tough as those used against terrorism and drug trafficking, an advisory panel said on Wednesday. The Commission on the Theft of American Intellectual Property said US responses so far, using the WTO and government talks, have not kept up with the fast growth of trade secret theft by cyber and traditional methods. The panel recommends making the US president’s national security adviser the chief policy coordinator of an all-out drive to protect intellectual property and punish theft. China accounts for between 50 percent and 80 percent of intellectual property theft, said the report, based on data from customs seizures and other trade figures.