Coronavirus Supply Chain Disruptions Hurt HP Sales; Stock Down

COVID-19 “macroeconomic and supply chain challenges” sent HP Q2 revenue down 11% to $12.5 billion, said CEO Enrique Lores on a Wednesday investor call. “While some areas performed very well as people shifted to work from home, others suffered, and we faced supply chain disruptions.” The quarter ended April 30. Though the Chinese production that was shut down after the Lunar New Year began to “ramp” in late February, “we also experienced disruptions to operations in Southeast Asia and other parts of the world as the pandemic spread,” said Lores. Production was “largely back to full capacity” by early May, he said. Higher PC demand, combined with supply chain disruptions, “resulted in an elevated backlog, which we expect to work down during Q3," he said. “Manufacturing disruptions” prevented the company from keeping pace with the spike in consumer orders for “hardware and ink supplies,” said Lores. Consumer revenue in the quarter declined 16%, said Chief Financial Officer Steve Fieler. The stock closed 12% lower Thursday at $15.01.