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HP Storage Down, But Improving

Hewlett-Packard Co. (NYSE: HPQ) claimed a fourth-quarter comeback in its earnings report tonight, declaring "record" revenue of $21.4 billion, up 8 percent year-on-year and 13 percent sequentially (see HP Earnings Are Up).

On a conference call tonight, CEO Carly Fiorina said growth was up across all parts of the business, including enterprise servers and storage, which grew 7 percent overall.

Still, storage remains a problem child. Despite overall improvement in enterprise storage and servers, which was the primary drag on last quarter's earnings, storage will take "more than a quarter or two" to improve substantially, Fiorina says (see HP Storage Slammed, HP Plots Storage Comeback, and Red Hat Certifies Emulex HBAs).

Net revenues for enterprise storage and servers rose to $4.1 billion and accounted for 19 percent of overall revenues. Last quarter, segment revenues were $3.35 billion, about 18 percent of overall revenues.

Despite the 22 percent uptick and 7 percent year-on-year improvement in enterprise storage and servers, sales of storage gear within the segment were down overall by 9 percent year-over-year. But storage grew overall 16 percent sequentially, thanks to a variety of efforts HP undertook, including improvements to SAN gear at the low and high ends (see Hitachi, HP Offer 300-Gig Drives , HP Claims First to Hit 100K, and HP Adds Low-End NAS).

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